All car owners must have liability coverage. Liability coverage pays for any claim in which you are at fault for an accident. Wherever you live and drive in the Land of Opportunity, having adequate car insurance is both a legal requirement and common-sense protection. If you're at fault for a car accident, your liability insurance pays for repairs to the other driver's car and will likely cover the doctor's bills if you're injured.
Collision insurance covers repair or replacement costs if you have an accident, hit an object, or roll over your car. Vehicle insurance premiums are regulated by the Insurance Department of the Arkansas Department of Finance and Management. If you own a car in Arkansas, the law requires you to maintain adequate insurance, keep proof of insurance in your vehicle, and keep your registration labels up to date. Comprehensive insurance covers repair or replacement costs if your car is damaged by falling objects, natural disasters, floods, fires, thefts, vandalism, or animals.
Some states require drivers to have PIP or MedPay, while collision insurance is often mandatory if you rent or finance your car. Lenders often require collision and comprehensive insurance, in addition to the insurance that you must have under Arkansas law when financing a car. You should cancel your car's full coverage insurance when the cost of the insurance is equal to or greater than the potential payment, in the event of a covered event. For example, it might not be worth doing expensive repairs to an old car with high mileage, and you might want to save up to buy a new car instead of paying for additional insurance.
