Buying workers’ compensation for:


State Fund: No

Insurance Coverage Requirements: Workers’ Compensation is compulsory in Arkansas, some waivers are permitted.

Who is Required to Purchase Workers’ Compensation Coverage?

Workers’ compensation insurance coverage is required for employers:

  • In which three or more employees are regularly employed by the same employer;
  • In which 2 or more employees are employed by any person engaged in building or building repair work;
  • In which 1 or more employees are employed by a contractor who subcontracts any part of his contract;
  • In which 1 or more employees are employed by a subcontractor.

The term "employee" also includes a sole proprietor, partner, or member who devotes full time to the proprietorship, partnership, or limited liability company. However, any sole proprietor, partner of a partnership, or member of a limited liability company who desires not to be included in the definition of "employee" may file for and receive a certification of non-coverage from the commission.

Employments not covered:

  • An employee employed as a domestic servant in or about a private home;
  • An employee employed to do gardening, maintenance, repair, remodeling, or similar work in or about the private home or residence of the person employing the employee;
  • Agricultural farm labor
  • The State of Arkansas and each of the political subdivisions (there are exceptions to this)
  • A person performing services for any nonprofit religious, charitable, or relief organization;
  • Any person engaged in the vending, selling, offering for sale, or delivery directly to the general public of any newspapers, magazines, or periodicals or any person acting as sales agent or distributor as an independent contractor of or for any newspaper, magazine, or periodical; and
  • Licensed Real estate agents

Factors that Impact Coverage

  • You are a sole proprietor or partner: In Arkansas, you are excluded from coverage but have the option to include yourself.
  • You are a corporate officer or member of an LLC: Arkansas includes you in coverage, but you have the option to exclude yourself.

Failure to Secure Compensation

Any employer who fails to secure compensation is subject to a fine of up to $10,000 as determined by the Workers’ Compensation Commission payable to the Death and Permanent Total Disability Trust Fund or be guilty of a Class D felony.

The commission may assess a fine against an employer who fails to secure the payment of compensation in an amount up to $1,000 per day of violation payable to the fund.

If an employer fails to secure the payment of compensation or pay any civil penalty assessed against the employer after an order is issued and has become final, the commission may petition the Circuit Court of the county where the employer’s principal place of business is located for an order enjoining the employer from engaging in further employment until such time as the employer secures the payment of compensation or makes full payment of all civil penalties.

Proof of Coverage is Required

  • All employers with current coverage must have a poster of instructions on display in the workplace. Employers may lose some of the protection provided them if they fail to post these directions.
  • Employers or their insurance representatives have the right to choose doctor(s) to treat injured workers, but notice of these choices must be given to employees. If the employer’s representative has a managed care organization (MCO) for work-related injuries, a health notice must be posted at the business.

Independent Contractors

Mistakenly classifying an employee as an independent contractor can result in significant fines and penalties.

View 20 factors used by the IRS and our independent contractor questionnaire to determine whether you have enough control over a worker to be an employer.

Key Resources

Other Tips

If your insured employs workers in multiple states or your insured’s employees are temporarily working out-of-state, they need to purchase insurance for all the states where their workers are located, according to each state’s laws. Call 1-800-476-2948 and let us walk you through it.

The nature of your insured’s business, number of employees being covered and past coverage and claims are all factors in how much their premium will cost.