Do you understand your car insurance policy?


I have to admit that, long ago before I entered law school at the ripe old age of 40, I never really bothered to read through my car insurance policy. It was only after I started really getting into the law that I began to understand why it is so important to understand your car insurance policy. Call me a late bloomer.

Nonetheless, it’s never too late to take the time and study the provisions in your policy. That way you’ll know, should you ever have to use it, what covers you, your loved ones and your passengers in the event of a car crash.

This article will touch on the basics of most car insurance policies, but be sure to read your own to see how it may differ.

Arkansas Insurance Provision Required by Law

Liability Insurance

If you own a car in Arkansas, you are required to carry a minimum amount of liability insurance. Liability insurance will cover you if you are at fault in an accident. Please note that the minimum amount of liability insurance required by law may not be sufficient to cover all of the costs of an accident.

  • The minimum liability required in Arkansas is $25,000 per injured person and a maximum of $50,000 per accident. That means that if three people were hurt, there would only be $50,000 to cover all of them, and no one person could receive more than $25,000.
  • Liability insurance will also cover the property damage to the other vehicle, or other damaged property. In Arkansas, the minimum property damage coverage is $25,000.

Other Car Insurance Options to Consider

  • MedPay or PIP: If you are injured in a car accident, whether the crash is your fault or not, if you carry Med/Pay or Personal Injury Protection (PIP) as part of your car insurance policy, your insurance company will pay your medical costs up to the maximum benefits you selected when you took out the insurance. Many people carry $5000.00 in benefits.
  • Uninsured Motorist (UM): If you are hit by someone who does not have insurance, unless you sue them and win (and if they have any assets) there will be no money to pay for your injuries, property damage and other loses like lost wages. If you have un-insured motorist coverage as part of your auto insurance policy, your insurance company will pay your medical bills, lost wages and property damage. There are many different limit options thats your insurance agent can discuss with you.
  • Under-Insured Motorist (UIM) coverage covers you if the amount of the liability insurance collected from the person responsible for your injuries is insufficient to pay for all your medical bills and other damages. For example, if the other insurance company only had the minimum liability coverage required by law (such as $25,000 in Arkansas) and your medical bills came to $15,000, then your insurance company will pay the difference.
  • Rental Car: If you opt for a rental car provision and your car needs repair or is totaled because of a car accident, rental car insurance will provide you with transportation for a certain amount of time. This coverage is usually purchased with a daily total maximum and you will be given a car that is similar to the one damaged (if you upgrade, you will have to pay the difference).
  • Towing or Emergency Road Service coverage pays the cost of towing your car to a repair shop. You may already have this coverage, if you are a member of AAA or some other program, so be sure not to duplicate any coverage.

PLEASE NOTE: Arkansas law states that whenever you apply for liability insurance, the insurance agent MUST offer you other types of insurance coverages. You do not have to purchase the additional coverage, but they must be offered. These additional benefits include Uninsured Motorist Bodily and Property Damage, Underinsured Motorist Coverage for Bodily Injury, And Personal Injury Protection (or MedPay) coverage.

Review: Understanding your Car Auto Insurance Policy

  • Your car insurance policy will financially protect you up to the policy limits you choose when you purchase the insurance.
  • Be aware of the types of coverage offered and what is required in your state.
  • Know the liability limit laws in Arkansas (or those of another state in which you may reside).
  • Know how to file a claim with your insurer, in the event of a car accident.

Please take a few moments to review your automobile policy and stay informed on who and what your car insurance policy covers.

If there is any part of your car insurance policy that you do not understand, be sure and call your insurance agent. You are his or her customer and you certainly have every right and need to know. They are usually extremely responsive to such questions.

Please, know your rights and be safe out there!

Please share this article for those who could benefit from the information. Thank you.
For other areas of personal injury law, please see my other articles at

If you have any questions about this article or any area of personal injury law, please refer to the contact info below.

Contact Information:

The Law Offices of Peter Miller

1601 S. Broadway

Little Rock, AR 72206

Phone: 501-374-6300



The content of this blog was prepared by the Law Offices of Peter Miller, P.A. for educational and informational purposes only. It is not intended to solicit business or provide legal advice. Laws differ by jurisdiction, and the information in this blog may not apply to you. You should seek the assistance of an attorney licensed to practice in your state before taking any action. Using this blog site does not create an attorney-client relationship between you and Law Office of Peter Miller, P.A. Attorney-client relationships can only be created by written contract.

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