In today’s digital economy, online marketplaces have become central to how we shop, sell, and interact with products and services. With that evolution, new challenges around consumer protections and platform accountability have emerged. To address these concerns, Arkansas has passed Senate Bill 329, officially titled the Online Marketplace Guarantees Act.
This new legislation establishes a clear and business-friendly regulatory framework for platforms offering guarantees—while ensuring that consumers are informed, protected, and able to seek redress when needed.
What Is an Online Marketplace Guarantee?
Under SB 329, an Online Marketplace Guarantee is defined as a contract or agreement connected to an online platform that promises to repair, replace, or compensate for damage or income loss related to using that platform.
Importantly, these guarantees:
- Are not considered insurance under Arkansas law
- Are exempt from certain licensing and tax requirements that typically apply to insurers.
This means digital businesses can offer added value and protection to users without being regulated as insurance companies, provided they meet specific financial and disclosure criteria.
Who Does the Law Apply To?
Any business operating an online platform that facilitates transactions or services in Arkansas falls under this law. This includes:
- E-commerce websites
- Gig economy platforms
- Marketplace apps and software systems
If these businesses offer consumer guarantees as part of their service, they must comply with the new requirements.
Provider Obligations Under SB 329
To legally offer online marketplace guarantees in Arkansas, providers must:
- Register with the Arkansas Insurance Commissioner and pay the applicable fee.
- Make terms easily accessible on their website and provide a record of purchase if the guarantee is sold separately.
- Demonstrate financial stability through one of the following:
- Insure all guarantees through a valid reimbursement insurance policy,
- Maintain a market cap of at least $200 million (for 30 of the past 90 days), or
- Maintain a net worth or cash balance of $50 million supported by financial statements.
What About Consumers?
The law includes strong consumer protection measures:
- Guarantees must be written in clear, understandable language.
- If the guarantee is backed by insurance, consumers must be informed of:
- Who the insurer is,
- What the provider is obligated to do, and
- The consumer’s right to file a claim directly with the insurer if the provider doesn’t follow through.
Consumers benefit from increased transparency and the peace of mind that protections are in place—without added cost or complexity.
Enforcement and Oversight
The Arkansas Insurance Commissioner has full enforcement authority and may act against:
- False or misleading advertising,
- Omission of important details, or
- Failure to register or disclose required information.
This ensures a level playing field while discouraging bad actors from exploiting the digital marketplace.
How Lexington National Insurance Corporation Can Help?
If your business is offering online marketplace guarantees in Arkansas, Lexington National Insurance Corporation can help you comply with the new law.
Lexington National is an “A” rated insurer that issues contractual liability insurance policies to companies across the country. We work closely with administrators, platforms, and service providers to structure compliant, scalable, and financially secure CLIP-backed programs—whether you’re in automotive, home, consumer electronics, or the digital services space. Lexington National’s deep experience in contractual liability insurance and custom risk structures makes us an ideal partner in this evolving regulatory landscape.
Interested in learning more? Contact us at 888-888-2245 to explore how Lexington National can help you meet the financial backing requirements under Arkansas SB 329 and beyond.
Disclaimer
This blog post is for informational purposes only and does not constitute legal, financial, or insurance advice. For guidance specific to your business or legal obligations, please consult a qualified professional or legal counsel.