AutoInsurance.com
October 5, 2022

State Farm Auto Insurance Review

Your friendly neighborhood auto insurance provider

State Farm is known for its catchy marketing campaigns, such as “Like a good neighbor, State Farm is there” and Jake from State Farm. Brand recognition is just one of the reasons 87 million people carry State Farm insurance. Read our full review of State Farm auto insurance before you sign up for a policy to see if State Farm is the right choice for you.

Key Takeaways

State Farm is one of the largest companies and insurance providers. It provides a wide range of insurance products, online support, and mobile capabilities. Your local State Farm agent can assist you with your specific insurance needs.

Who It’s Best For

  • People who prefer to work with a local agent
  • Families and individuals with multiple insurable properties, including homes, cars, and businesses
  • Rideshare drivers who need coverage above and beyond their employers’ policies

Who It’s Not Best For

  • Drivers with multiple at-fault incidents on their driving records
  • Military and federal employees

Pros

  • Numerous discounts: State Farm offers a wide array of discounts, such as discounts for teen drivers, multicar, and bundled savings.

  • Mobile app: State Farm has a sophisticated mobile app with convenient features so you can track claims and pay your policy on the go.

  • Local agents: State Farm relies on exclusive agents, which means only State Farm agenda can sell its insurance products and the agents can only sell State Farm products. With a network of 19,000 exclusive agents, there is likely a qualified and experienced State Farm agent in your area.
     

Cons

  • Limited gap insurance: If you lease or finance a car, gap insurance helps you pay if it is badly damaged or totaled. State Farm does not offer payoff protection unless your auto loan is from State Farm Bank. However, if your auto loan is with another bank, you will not receive assistance in paying the difference between the market value of your vehicle and what you still owe on your loan or lease.

  • Mixed reviews: It’s no surprise that a company as large as State Farm has its detractors. Customers online express dissatisfaction with customer service and claims assistance.

State Farm Car Insurance Coverage

  • Collision coverage: Collision insurance pays to fix or replace a car when it is damaged in a collision or if it rolls over. State Farm collision coverage extends to temporary substitute cars, newly acquired cars, and non-owner insurance.
  • Comprehensive coverage: This type of coverage pays for repairs or replacements on a covered vehicle when stolen or damaged by something other than a collision. State Farm coverage includes glass claims and windshield repairs from fire, wind, hail, flood, theft, vandalism, and falling objects.
  • Liability coverage: Liability coverage is required in nearly every state. It assists with the cost of damage to the other driver’s property and injuries if you are at fault in an accident.
  • Car rental coverage: If your car is in the repair shop because of a covered claim, State Farm will help pay rental costs. If you rent from a company in State Farm’s network, it will pay the company directly. If not, State Farm will reimburse you up to the amount your policy specifies. There is a daily and per-claim limit of up to $16 per day and up to $400 total.
  • Travel expenses: State Farm will help pay for meals, lodging, and transportation between your destination and vehicle — both ways — if your car is damaged more than 50 miles from home. Coverage is capped at $400 per loss.
  • Repayment of deductible expense: State Farm will pay up to $500 toward the deductible if you have a covered-loss accident in a rental car.
  • Uninsured/underinsured motor vehicle coverage: Some states require uninsured/underinsured coverage, which covers you when the driver at fault does not have enough or any insurance. Uninsured/underinsured insurance covers expenses related to lost wages, medical payments, pain, and suffering if you are injured in an accident. It also applies to car damage if the at-fault driver’s insurance can’t pay.
  • Medical payments coverage (Med Pay): Most states do not require medical payments coverage, but policyholders can add it for $5 to $8 per month. Med Pay assists with medical and funeral expenses when an accident injures the policyholder, passenger, or member of the policyholder’s family no matter who caused the accident. In no-fault states like Florida, Med Pay is called personal injury protection (PIP).
  • Emergency road service coverage: This coverage pays for: one hour of mechanical labor at the breakdown site; towing; delivery of gas, oil, battery, or tire; and locksmith labor.
  • Rideshare insurance: State Farm offers an endorsement for rideshare drivers that extends your personal State Farm auto policy when you use your vehicle for rideshare driving through a service like Uber or Lyft.
  • Gap coverage: State Farm offers payoff protector coverage if your loan originates from State Farm Bank. This gap insurance will cover the difference between the amount your auto insurance pays on a total loss claim and the outstanding principal balance due on your loan. Learn more about gap coverage.
  • Liability umbrella policy: State Farm provides additional liability with its umbrella policies. Liability includes protection against personal claims like libel or slander with minimum coverage of $1 million, increasing in $1 million increments.

What Will My Auto Insurance Rate Be?

Your auto insurance premium depends on your location, age, driving record, car model, safety rating, credit score (average rates will be higher for people with poor credit, typically), deductible, and choice of coverage. Full coverage will cost more than minimum auto insurance coverage. The average annual cost of auto insurance from State Farm is $1,419, far below the national average of $2,071.

Discounts

  • Bundling discount: Save when you bundle life, home, condo, or renters insurance with your car insurance policy from State Farm.
  • Multiple auto savings: You receive a discount when you insure two or more household vehicles with State Farm.
  • Drive Safe & Save discount: Your smartphone app can track your driving habits to save you up to 30 percent on your premium at each policy renewal (every six months).
  • Good driver discount: New State Farm customers will receive a discount after three years without moving violations or at-fault accidents.
  • Steer Clear driver program: Drivers under the age of 25 who have valid driver’s licenses and no at-fault accidents or moving violations during the past three years, and a program certification from Steer Clear, receive a discount of up to 15 percent.
  • Good student discount: Students under 25, including homeschoolers, may qualify for a discount of up to 25 percent if they submit report cards or standardized tests that confirm they rank in the upper 20 percent of their class.
  • Student away at school discount: Your policy may be eligible for this discount if one of the operators of a covered vehicle is a college student under 25 who uses a car only while at home during school vacations and holidays.
  • Accident-free discount: You may receive additional savings if you maintain an accident-free driving record.
  • Defensive driving course discount: State Farm offers driver safety courses in many locations. Completing a course will get you a discount on your premium.
  • Vehicle safety discounts: Vehicles equipped with modern safety features such as automatic braking and forward collision warning qualify for additional savings.
  • Passive restraint discount: Covered cars that were made before 1993 and equipped with factory-installed airbags or other passive restraint systems may be eligible for a medical coverage discount of up to 40 percent.
  • Anti-theft discount: This discount is available if your vehicle has an alarm or other anti-theft devices like a GPS or starter disabler.

CheckTIP

State Farm’s Steer Clear program offers a discount to young drivers who complete the following requirements:

  • Five training modules including videos, driving scenarios, and quizzes
  • Five hours of practice driving in at least 10 trips
  • Mentoring from friends or family who provide feedback on the app

Availability

State Farm offers insurance products in all 50 states and Washington, D.C. through a network of 19,000 agents. Your local agent will understand the state auto insurance laws that apply to your situation.

State Farm Customer Service

Contact your local State Farm local for everyday customer service issues. If you have trouble reaching your agent, call State Farm Customer Care at 800-782-8332. Or, mail payments to the address below:

  • State Farm Insurance Companies
  • Insurance Support Center — East
  • P.O. Box 588002
  • North Metro, GA 30029

Mobile App and Online Features

We tested State Farm Mobile to ensure it has all the important features. The app has a 4.7-star rating on Google Play and a 4.8-star rating on the Apple App Store. Reviewers noted the ease with which they can pay auto insurance bills and access their insurance cards. State Farm Mobile features allow you to carry out the following tasks:

  • Pay insurance bills with Google Pay or Apple Pay.
  • View your auto insurance I.D. card and add it to Apple Wallet or Google Pay.
  • View your insurance policies and coverage details.
  • File a vehicle, property, or vehicle glass claim.
  • Track the status of your claim.
  • Get assistance with tire changes, dead batteries, stuck vehicles, and more.
  • Search for repair facilities.
  • View details of investment products.
  • Receive personalized reminders and notifications.
  • Search for answers to frequently asked questions.

In addition to State Farm Mobile, State Farm Drive Safe & Save Mobile and Steer Clear track your driving habits for discount programs.

Third-Party Ratings

  • AM Best rating: AM Best rated State Farm’s claims-paying ability and credit quality. State Farm holds an AM Best rating of A++, meaning it is considered financially solvent and strong.
  • Better Business Bureau (BBB) customer rating: The BBB does not accredit State Farm, but the company has a customer rating of 1.15 out of five stars.1 Many of the reviews of State Farm mention a lack of personalized customer service and disappointing claims assistance.
  • National Association of Insurance Commissioners (NAIC) Complaint Index: State Farm’s NAIC Company Complaint Index is 2.72, which means its complaint index is over twice as high as expected in the market.2
  • J.D. Power satisfaction rating: J.D. Power ranks customer satisfaction across 11 geographic regions. State Farm is the highest-ranking auto insurer across three regions:
    • Florida: In Florida, State Farm’s satisfaction rating is 848.
    • New York: In New York, where State Farm ranks first for the second year in a row, its satisfaction rating is 859.
    • Northwest region: In the Northwest region, State Farm’s satisfaction rating is 844.3

People tend to send complaints in extreme circumstances, so take State Farm’s NAIC score and BBB customer rating with a grain of salt. State Farm’s high J.D. Power satisfaction ratings and A++ rating from AM Best indicate that consumers and industry insiders view the company favorably.

Light BulbHOT TIP

We named State Farm the best auto insurance overall. State Farm lets you manage your customized policy from a user-friendly mobile app. It also has numerous discounts to take advantage of, making it a reliable and affordable provider.

Company History

Founded in 1922, State Farm began as a mutual automobile insurance company to assist farmers in Bloomington, Illinois. It launched its interlocking red tri-oval logo in the 1940s. State Farm became the largest auto insurance company in the United States in 1942 and launched in Canada in 1947.4

In the 1950s, State Farm held a contest among its agents to come up with ideas to expand the business. Robert H. Kent, an agent in Chicago, came up with the idea of providing auto loans to existing policyholders. State Farm rolled out the program to all its agents, creating the first marketing partnership between insurance companies and banks.

State Farm refreshed its brand during its 2012 90th anniversary celebration. In 2014, it sold its operations in Canada to Desjardins Group. State Farm was officially rebranded to Desjardins Insurance in Canada in 2018.

State Farm acquired the Dallas-based, non-standard auto insurer GAINSCO in 2020. It marked the first acquisition of an insurance company by State Farm in its history. State Farm celebrated 100 years of business in 2022. At the same time, State Farm acquired a 15 percent stake in security services company ADT to expand its homeowners’ insurance capabilities.

Other Types of Insurance State Farm Provides

  • Boat insurance
  • Collector & classic car insurance
  • Commercial insurance
  • Disability insurance
  • Health insurance
  • Home insurance
  • Identity theft insurance
  • Life insurance
  • Motorcycle insurance
  • Motorhome and RV insurance
  • Off-road vehicle insurance
  • Renters insurance

Cancellation Policy

State Farm does not require a cancellation fee. Instead, it will prorate your premium at the time of cancellation and refund you the difference.

You can cancel your insurance policy by phone, mail, or in person. Contact your local State Farm agent or call 800-782-8332. Cancellations by phone are usually effective immediately, but you can schedule them for a date in the future as well.

To cancel your policy by mail, send a letter at least two weeks before your intended cancellation date to the address below:

  • Corporate Headquarters
  • State Farm Insurance
  • One State Farm Plaza
  • Bloomington, IL 61710

Frequently Asked Questions

What does State Farm full coverage auto insurance cover?

State Farm’s full coverage auto insurance covers liability, comprehensive and collision incidents, uninsured and underinsured motorist coverage, and medical payments coverage/personal injury protection (PIP) for covered vehicles.

Full coverage auto insurance does not include emergency roadside assistance and towing, ridesharing, rental car reimbursement, gap coverage, optional basic economic loss or glass coverage.

How long does State Farm take to settle a claim?

It takes State Farm between 30 to 45 days to settle a claim after you submit a complete demand package. You can file and check your claim online. Enable email and text alerts to track your claim once you submit it.

What are the top five insurance companies?

The top five insurance companies are State Farm, Allstate, Direct Auto, GEICO, and The Hartford (AARP). State Farm takes the top spot because of its policy customizations and user-friendly mobile app.

Is State Farm good at paying claims?

Yes, State Farm is good at paying claims. The company has an A++ rating from AM Best, which ranks companies for financial stability, and is 42nd on the Fortune 500 list, which ranks companies based on revenue. State Farm incurred claims and loss adjustment expenses of $34.4 billion in 2021, so expect fast processing of your auto insurance claim.

Citations

  1. State Farm Insurance Company. Better Business Bureau. (2022).
    https://www.bbb.org/us/il/bloomington/profile/insurance-companies/state-farm-insurance-company-0724-6000391

  2. State Farm Gen Ins Co National Complaint Index Report. National Association of Insurance Commissioners. (2022).
    https://www.naic.org/cis_refined_results.htmTABLEAU=CIS_COMPLAINTS&Cocode=25151&REALM=PROD

  3. Auto Insurance Customer Satisfaction Stalls Despite $18 Billion in Premium Relief, J.D. Power Finds. J.D. Power. (2021, Jun 15).
    https://www.jdpower.com/business/press-releases/2021-us-auto-insurance-study

  4. America’s Mailing Industry – State Farm. Smithsonian. (2022).
    https://postalmuseum.si.edu/exhibition/america%E2%80%99s-mailing-industry-industry-segments-financial-services-industry/state-farm