In Arkansas it is unlawful for any person to operate a motor vehicle unless the vehicle is insured with the minimum amount of liability coverage. This minimum coverage is $25,000 for bodily injury or death of one person in any one accident; $50,000 for bodily injury or death of two or more persons in any one accident and $25,000 for damage to or destruction of the property of others.

Before renewing your license you are required by Arkansas law to assess your vehicle with your county assessor and pay all personal property taxes you owe. You are also required to maintain liability insurance on your vehicle. These requirements are automatically checked using a computer.

There is also an Insurance Verification Program in effect. It is to verify that all owners of motor vehicles registered in Arkansas maintain liability insurance as required by law. This is done by reports from insurance companies when a person cancels or has a lapse in insurance.

So in a way your license is flagged, in the sense that the AR Office of Driver Services will know that you do not have insurance on the vehicle and you will be unable to provide them with proof if they requested it of you for their verification process.

As for penalties, in Arkansas if you are found without insurance there is a graduating scale of penalties, all with mandatory fines. For the first offense a fine of between $50 and $250 is required to be paid. For a second offense a fine of between $250 and $500 is due. A third or any subsequent offenses have a fine of between $500 and $1000 or a sentence of 1 year in jail or both.

According to AR State Code 27-22-104, if you are stopped by law enforcement and are unable to present proof of the vehicle's insurance coverage as required in or if a check of the database at the time of the traffic stop fails to show current insurance coverage, the operator shall be issued, in addition to any traffic citation issued a notice of noncompliance on a form to be provided to the Department of Finance and Administration.

In addition, the officer shall remove and impound the license plate attached to the vehicle so that the plate shall be returned to the Office of Driver Services or to the local revenue office. The police will then issue for attachment to the rear of the vehicle a temporary sticker denoting its use in lieu of an official license plate.

Upon receipt of the notice of noncompliance by the department, the department shall proceed to suspend the registration of the uninsured vehicle effective ten days after the license plate was taken and the notice of noncompliance was issued.

Any suspension by the department under this section shall remain in effect and no registration shall be renewed for or issued to any person whose vehicle registration is so suspended. In order to reinstate the suspended registration and be reissued a license plate for any suspended motor vehicle, the owner shall present the proof of renewed or new financial coverage required and shall pay to the department a twenty dollar ($20.00) fee for reinstatement of the registration and reissuance of the license plate

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