Jump ahead to learn:
- Is Arkansas Workers’ Compensation insurance required for my business?
- How does Workers’ Compensation in Arkansas work?
- What could AK Workers’ Comp coverage include?
- Who could qualify for an Arkansas Workers’ Comp waiver?
- How much does Workers’ Compensation in Arkansas cost?
- How ERGO NEXT helps Arkansas small business owners
Is Arkansas Workers’ Compensation insurance required for my business?
The Arkansas Workers’ Compensation Commission states that workers’ compensation insurance is required for all businesses with three or more employees. This could include both full-time and part-time employees, and even subcontractors.
If you work in construction, the rules are stricter: You must carry coverage with as few as two employees, and subcontractors working on your projects need their own coverage.
Some clients may ask for proof of coverage before they’ll work with you even if it’s not required by the state.
Even if it’s not required, workers’ comp in Arkansas could help protect your business if an employee gets hurt on the job. Without workers’ comp, medical bills and lost wages could become your personal responsibility.
Arkansas employers also have a few additional obligations once they have coverage:
- You must display your certificate of insurance (COI) as a poster with instructions at your workplace where both employees and customers can see it.
- You and your insurance carrier have the right to choose which doctors treat injured workers, but you must give employees notice of that choice.
- All employee injury reports and medical bills must be sent to your insurance company promptly.
How does Workers’ Compensation in Arkansas work?
If one of your employees suffers a work-related injury or illness, Arkansas workers’ compensation could provide a structured process for getting them the care and benefits they need, and help protect your business from a financial fallout.
Here’s how the process works in Arkansas, per the Arkansas Workers’ Compensation Commission (AWCC):
- Report the injury. Your employee must report the work-related injury to you as soon as possible, ideally within 30 days. Once you’re notified, you must report the injury to your insurance carrier and to the AWCC. If the injury results in more than seven days of lost work time, you must file Form 1 with the Commission within 10 days.
- Get medical care. In Arkansas, you and your insurance carrier have the right to direct your employee to an authorized treating physician. Employees shouldn’t seek treatment outside that approved provider network without authorization, as this could affect their workers’ compensation benefits.
- The insurer reviews the claim. Your insurance carrier reviews the claim and determines what benefits apply based on the nature and severity of the injury.
- Benefits are paid. Depending on the outcome, the insurer coordinates payment for authorized medical treatment — including doctor’s visits, hospitalization, surgery, prescription drugs, medical supplies and mileage reimbursement — as well as a portion of lost wages if your employee can’t work.
- The employee returns to work or receives ongoing benefits. Once medically cleared, your employee returns to their role. If the injury results in a permanent impairment or prevents them from returning to work, ongoing disability or retraining benefits may apply.
Arkansas workers’ compensation also operates under an exclusive remedy rule: When an employee receives workers’ comp benefits, they generally can’t sue their employer directly for negligence related to that workplace injury. That can be a legal safeguard for your business.
Let’s say you run a small landscaping company in Little Rock.** One of your employees slips and breaks their wrist. Workers’ compensation could help cover their emergency room visit, follow-up care, physical therapy and a portion of their wages while they’re out, without your business paying those costs out of pocket.
What could AK Workers’ Comp coverage include?
Workers’ comp in Arkansas can help pay for expenses related to work-related injuries for your employees — and for yourself if you add optional owners coverage to your policy.
If one of your employees is injured on the job, an Arkansas workers’ comp policy could help pay for:
- Medical treatment and medical care for on-the-job injuries and work-related illnesses.
- Weekly wages from lost income benefits.
- Retraining if employees can no longer do their job.
- Permanent disability benefits and temporary disability benefits.
- Death benefits and survivor benefits.
Workers’ compensation doesn’t usually cover incidents that aren’t job-related, or situations where the injured person violates company policies, commits misconduct or uses drugs or alcohol.
Arkansas Workers’ Comp income benefits
If an employee is temporarily or permanently unable to work due to a work-related injury or illness, they may be eligible for the following income benefits, per the Arkansas Workers’ Compensation Commission. Note that specifics can change; be sure to reference Arkansas state law for the most up-to-date information.
- Temporary total disability (TTD): If a doctor confirms an employee can’t work at all, they receive two-thirds (66.67%) of their average weekly wage. For 2026, the maximum TTD rate in Arkansas is $953 per week. There’s a seven-day waiting period before benefits begin, but if the disability lasts more than 14 days, your employee will be compensated for that initial waiting period, too.
- Temporary partial disability (TPD): If your employee can return to work with restrictions at reduced wages, they may receive a portion of the difference between their pre- and post-injury earnings.
- Permanent partial disability (PPD): If the injury results in lasting impairment after your employee has reached maximum medical improvement (MMI), they’ll receive ongoing benefits based on their disability rating. For 2026, the maximum PPD rate is $715 per week. Non-scheduled injuries have a maximum payment period of 450 weeks.
- Permanent total disability (PTD): If your employee’s injuries are so severe they can never return to work, they may receive permanent total disability benefits.
Workers’ Comp death benefits in Arkansas
If an employee dies as a result of a covered workplace injury, their spouse, children or other dependents may be eligible for death benefits paid at 50% of the employee’s average weekly wage. Burial expenses of up to $6,000 may be covered as well. Benefits for a surviving spouse continue until remarriage or death; benefits for children continue until age 18, or age 22 if they’re a full-time student.
Who could qualify for an Arkansas Workers’ Comp waiver?
Arkansas workers’ comp exemptions are more accessible than in some states. Some workers who may qualify include:
- Businesses with fewer than three employees. They’re generally not required to carry workers’ comp in Arkansas. However, one key exception is that if you’re in construction, you must carry coverage once you have two or more employees.
- Agricultural farm labor.
- Domestic help.
- Railroad and maritime workers.
- Employees of religious, nonprofit or charitable organizations.
- Personnel covered by federal law.
Residential contractors can also be exempt from some requirements for workers’ comp. Arkansas may permit these types of contractors to exclude themselves from workers’ comp coverage:
- Sole proprietors
- Self-employed employers
- Partners
- Officers of a corporation
- Members of a Limited Liability Company (LLC)
- Members of a professional association
To receive a certificate of non-coverage, you must apply to the Arkansas Workers’ Compensation Commission. If approved, you’re only exempted from obtaining coverage for yourself. Employers must still provide workers’ comp insurance for employees.
Learn more about workers’ comp exemptions.
How much does Workers’ Comp insurance in Arkansas cost?
Workers’ compensation costs in the state of Arkansas vary based on a number of factors, including:
- Your number of employees and the type of work they do.
- Your total payroll.
- Your insurance claims history and workplace safety record.
- Where in the state your employees work.
To see the exact cost of workers’ compensation insurance for your business, get a free quote in about 10 minutes.
Arkansas uses the National Council on Compensation Insurance (NCCI) classification system to set baseline rates. Keeping a clean claims history and maintaining a safe workplace are two of the most effective ways to keep your premium down over time.
