Arkansas insurance law is in Title 23 of the Arkansas Code, with the Insurance Department's numbered Rules filling in the details (Rule 43 on claims, Rule 50 on CE, and others). The Arkansas law questions on every exam come from the same core: the Commissioner, licensing and appointments, CE, trust funds, unfair practices, fraud reporting, claims handling, and the guaranty funds. This guide covers those rules with citations. General regulatory concepts are in the national Insurance Regulation guide.

About the exam

Arkansas's licensing exams are delivered by PSI. The passing score is 70%.

Arkansas does not offer a combined Life & Health exam; candidates take the Life and Health exams separately. It also does not offer separate Property or Casualty exams; candidates take the combined Property & Casualty exam.

Before testing:

• Prelicensing education is required: at least 20 hours per line of authority, including at least 5 hours of Arkansas law (Ark. Code 23-64-202; Rule 31). A course completion certificate is good for two years.
• Once the Department approves a candidate to test, the exam must be passed within 90 days of approval, with up to three attempts in that window (PSI candidate bulletin).
• License applications and appointments are filed through NIPR.

The regulator

• The Arkansas Insurance Department is headed by the Insurance Commissioner.
• The Commissioner is appointed by the Governor with Senate confirmation, must be an Arkansas citizen at least 30 years old, and serves at the pleasure of the Governor (23-61-102).
• The Commissioner's powers are those the Code confers or reasonably implies (23-61-103). A rule may not extend, modify, or conflict with a statute. A rule that required a hearing takes effect after 10 days on file (23-61-108).
• Every authorized insurer is examined at least once every five years (23-61-201). An alien insurer is examined only on its U.S. business.
• Hearings. A demanded hearing is held within 30 days (23-61-303), with 10 days' notice (23-61-304). After a summary cease and desist order, a hearing requested within 30 days must be held within 10 days of the request (23-61-103(f)).
• Appeals are due within 30 days and go to the Pulaski County Circuit Court. In license cases, the appellant may use the circuit court of the county where the appellant lives (23-61-307).
• Possible crimes go to the local prosecuting attorney or the Criminal Investigation Division. The Commissioner may also order restitution (23-61-110).

Insurers

• An insurer needs a certificate of authority (23-63-201). Lawfully written surplus lines coverage is exempt.
• Domestic = formed in Arkansas; foreign = formed in another state; alien = formed outside the United States (23-60-102).

Licensing

Lines of authority (23-64-507):

• life
• accident and health
• property
• casualty
• variable life and annuity
• personal lines
• credit
• other permitted lines

Who does the work:

• An agent is the agent of the insurer that appointed it.
• A broker represents insureds and is deemed the insured's agent (23-64-102).
• An insurance consultant advises others about their insurance for a fee.
• An agent who also holds a broker license acts as the insurer's agent on business placed under an appointment (23-64-224).

Exemptions from licensing (23-64-504) include insurer employees who only inspect, rate, or classify risks, and a salaried employee advising their own employer who sells nothing for commission.

Moving to Arkansas. The exam and prelicensing requirements are waived for lines held elsewhere if the producer applies within 90 days of establishing Arkansas residence. An applicant whose prior license was cancelled gets the waiver if applying within 90 days of the cancellation (23-64-509).

Nonresidents. A nonresident whose home-state license stops being active has the Arkansas license summarily suspended (23-64-216).

Renewal and CE.

• Residents complete 24 hours every two years, including 3 hours of ethics, by their birthday (Rule 50).
• Excess hours carry forward only to the next period, and extra ethics hours carry over as regular hours.
• Nonresidents are exempt if their home state reciprocates.
• Residents licensed before July 1, 2003 who are 60 or older, or who have held a license 15 consecutive years, are exempt. These exemptions don't apply to anyone licensed after that date (23-64-301, -302).
• Renewal fees and CE are waived during active military duty.

Lapsed licenses. A lapsed license may be reinstated within 12 months of the fee due date without the exam, with a penalty of double the unpaid renewal fee (23-64-507).

Temporary licenses (23-64-511):

• They last up to 180 days and require no exam.
• They may go to the surviving spouse or court-appointed representative of a deceased or disabled producer, or the designee of a producer entering active military duty.
• The Commissioner may limit the license and require a sponsor.

Reporting and display.

• Address changes are due within 30 days (23-64-507).
• Administrative actions in other states are reported within 30 days of final disposition, with the order. Criminal prosecutions are reported within 30 days after the plea (23-64-517).
• The license must be conspicuously displayed at the place of business. Agents keep records at least five years (23-64-220).
• A resident who leaves Arkansas returns the resident license within 10 days (23-64-218).

Appointments

• A producer may act for an insurer only if appointed (23-64-514).
• The insurer files the appointment within 15 days after the agency contract is executed or the first application is submitted. The Commissioner verifies eligibility within 30 days and notifies the insurer within 5 days if the producer is ineligible.
• Appointments renew every year on June 1, and the insurer pays the fee.
• Termination (23-64-515):
  • The insurer notifies the Commissioner within 30 days of a termination for any reason.
  • It sends the producer a copy within 15 days, by certified mail or overnight delivery if the termination was for cause.
  • The producer may respond within 30 days.
  • Reports are immune from civil liability absent actual malice.

Commissions and trust funds

• Commissions may not be paid to anyone who must be licensed but isn't. Renewal commissions may go to someone who was licensed when the sale was made (23-64-513).
• Premiums are trust funds held in a fiduciary capacity. Diverting them is theft of property (23-64-223).
• P&C fees (2025 law). A property or casualty agent who charges a fee must disclose it separately. Fees plus all producer commissions may not exceed 20% of the gross premium (23-66-310, as amended by Act 23 of 2025).

Discipline and penalties

Grounds (23-64-512) include:

• a felony conviction
• improperly using notes during an exam
• failing to comply with a child support order
• failing to answer a written inquiry from the Commissioner within 30 days

Penalties:

• A suspension may last up to 36 months (23-64-216).
• Fines in place of or in addition to suspension are up to $1,000 per violation, or $5,000 if willful, plus related commissions.
• After revocation, no new license for three years (23-64-217).
• The general penalty for code violations is up to $1,000 per violation, capped at $50,000 in six months (23-60-108).
• A denied applicant may demand a hearing within 30 days.

Unfair trade practices (23-66-206)

Prohibited practices include:

• misrepresentation of policy terms
• false advertising
• defamation of anyone's financial condition
• boycott, coercion, and intimidation
• false financial statements
• twisting (23-66-306)
• churning: replacing a life or A&H policy without following the replacement law or showing a benefit to the insured
• rebating: any rebate or inducement not stated in the contract, including offering free coverage to induce a purchase. Token advertising gifts worth $100 or less wholesale are allowed

Unfair discrimination covers:

• life insurance between people of the same class and equal expectation of life
• A&H between people of the same class and essentially the same hazard
• P&C refusals based on race, national origin, sex, marital status, and other listed traits
• refusals based on geographic location or a home's age without a non-pretextual business reason
• refusing coverage because the applicant is a victim of domestic abuse
• refusing or rating life coverage because the applicant is a living organ donor

Other rules:

• Refusing P&C coverage just because a prior insurer nonrenewed the applicant is an unfair underwriting practice.
• Insurers keep a complaint register covering the current year plus five calendar years.
• A producer who charges a financial planning fee and will also earn a commission must disclose that in writing.

Penalties (23-66-210):

Claims (Rule 43 and 23-66-206(12))

Unfair claims practices count as violations when committed often enough to show a general business practice. Examples include misrepresenting policy provisions, refusing to pay without a reasonable investigation, and requiring repairs at a particular shop.

Rule 43 deadlines:

Other Rule 43 rules:

• A denial based on an exclusion must be in writing and cite the exclusion.
• Notice to an agent is notice to the insurer.
• An unrepresented claimant gets written warning of an expiring time limit at least 30 working days ahead (first party) or 60 calendar days ahead (third party).

Fraud

• Anyone in the business of insurance who knows or reasonably believes a fraudulent act occurred must report it to the Commissioner. A knowing failure to report is a Class A misdemeanor (23-66-505).
• The report can be made on a fraud referral form filed with the Department's Insurance Fraud Investigation Division (Rule 67).
• Claim forms and applications carry a fraud warning, but its absence is no defense (23-66-503).

Replacement

• Before urging a client to surrender a life policy for a new one, the producer gives a written, dated memorandum comparing the policies, signed by producer and insured (23-66-307).
• Both the insurer and the producer keep it five years. Violations are a Class A misdemeanor.
• For preneed replacements, the new contract has a 30-day return right, and the existing insurer is notified within 15 business days (Rule 63).

Surplus lines

• Coverage may go to a nonadmitted insurer only if the full amount can't be obtained from authorized insurers after diligent effort (23-65-305).
• An eligible U.S. surplus lines insurer needs capital and surplus of at least the greater of the Arkansas minimum or $15 million. An alien insurer must be on the NAIC Quarterly Listing.
• A resident surplus lines broker needs three years as a licensed producer and a $50,000 bond (23-65-308).
• A contract placed in violation of the law is voidable by the insured.

Guaranty funds

Arkansas Life and Health Insurance Guaranty Association (23-96-101 and following):

Coverage applies only to Arkansas residents at the time of the insolvency order, and producers may not use the association to sell.

Arkansas Property and Casualty Insurance Guaranty Act (23-90):

• Covered claims are paid up to $300,000, except workers' compensation.
• Unearned premium is covered at 100%, up to $25,000 per policy.
• Not covered: punitive damages, claims of insureds worth more than $50 million, claims filed after the court's claim deadline, and title insurance.
• Claims arising within 30 days after insolvency are covered.
• Assessments are capped at 2% of net direct written premium per year.

Common exam traps

• The exam vendor is PSI.
• Arkansas has no combined L&H exam and no separate Property or Casualty exams.
• The Commissioner is appointed by the Governor with Senate confirmation.
• Appointments are filed in 15 days, renew each June 1, and terminations are reported in 30 days.
• CE is 24 hours with 3 of ethics, due by the birthday, with one period of carryover.
• Temporary licenses last 180 days.
• Suspensions run up to 36 months, and relicensing after revocation takes three years.
• Fraud reporting is mandatory.
• Gifts are capped at $100.