The $2.8 billion institution will pay more than $500,000 in additional premiums next year, keeping employee costs flat despite double-digit rate increases.

As health care costs continue to climb nationwide, Arkansas Federal Credit Union is taking a notable step to shield its employees from the financial impact. The $2.8 billion-asset credit union, based in Little Rock, announced that it will absorb a significant portion of its 2026 health insurance premium increases—costs that would otherwise fall on its workforce.

Facing premium hikes of 30% for its Base High-Deductible Health Plan (HDHP) and a combined 21% increase across all plan options, the credit union opted to hold employee contributions steady. The move will add more than $500,000 to Arkansas Federal’s annual expenses while saving individual employees between $350 and $1,600 in premiums, depending on their plan and coverage tier.

“Facing a substantial increase in health premiums for 2026… we prioritized minimizing disruption for our employees,” said Heather Savage, the credit union’s Chief Human Resources Officer, in an interview with Tyfone. “Our philosophy is simple: if we take care of our team, they will take care of our members.”

Savage noted that approximately 91% of Arkansas Federal’s employees—385 in total—participate in the organization’s health benefits. The new policy takes effect Jan. 1, 2026.

The decision comes as the credit union posts strong financial results. Arkansas Federal earned roughly $24 million in the first three quarters of 2025, a 62% increase from a year earlier, according to NCUA call report data. The institution, which serves nearly 172,000 members across Arkansas, has grown steadily in recent years while maintaining a reputation for employee-focused policies.

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In addition to covering rising insurance costs, Arkansas Federal will enhance other employee benefits next year. The employer 401(k) match will increase by half a percentage point, rising to 4% on an employee’s 6% contribution. The credit union is also boosting its Health Savings Account (HSA) match, providing an additional $85,000 annually to help employees offset medical expenses. Beginning in 2026, the HSA match will increase from $400 to $500 for employee-only coverage, $600 to $1,000 for employee plus one, and $800 to $1,200 for family coverage.

President and CEO Rodney Showmar underscored the organization’s commitment to its workforce in an interview with Tyfone, noting that Arkansas Federal “pays 100% of the premiums for Health, Dental, & Vision for all employees and their families” and provides tuition reimbursement for dependents from pre-K through college.

Employees have taken notice. In a recent LinkedIn post, indirect loan processor Tanja Sobik wrote that she had been “very nervous” about this year’s insurance renewal but was relieved to learn that Arkansas Federal “is stepping up in a BIG way… absorbing 30% of the health insurance premium increase.” She added that the decision “makes a big difference for families, peace of mind, and overall well-being.”

Savage said the move reflects Arkansas Federal’s core values. “Preserving stability and reducing stress for employees in the short term was more important than pursuing long-term savings,” she said. “We believe these decisions reflect our ongoing commitment to our employees and our core values as a credit union.”

“Our philosophy is simple: if we take care of our team, they will take care of our members.”

– Heather Savage
Chief Human Resources Officer
Arkansas Federal Credit Union