Statefarm

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State Farm has existed for nearly a century, and has the chops to prove its worth in the insurance world.

Overview

State Farm was founded back in 1922 by farmer George Jacob Mecherle, that wanted to make a higher income than farming would allow, George began his company by devoting it to supplying farmers with auto insurance. In its first 22 years of existence, State Farm had already written 1 million auto insurance policies. Having such success with auto insurance, State Farm branched out to include most types of insurance in its portfolio.

In a study comparing State Farm’s insurance with most other existing insurance companies, State Farm ranked very highly amongst a variety of demographics for giving some of the lowest rates. The only customers that won’t find the best rates with State Farm, are those with poor credit.

Studies show an overall satisfaction rating in regards to the services provided by State Farm. There have been some complaints about service in regards to the speed with which claims have been handled, and that premiums can run a little high, but around 70% of State Farms customers said they would stay on with State Farm as their insurer, and that they would recommend them to others for their insurance needs.

Driver Average Rate
Single 25-year-old male $1,469
Single 25-year-old female $1,332
Married 35-year-old male $1,205
Married 35-year-old female $1,204
Married 60-year-old male $1,099
Married 60-year-old female $1,099

Statefarm Pros And Cons

Pros

  • It’s easy to file a claim with State Farm’s helpful, and knowledgeable, staff.
  • Known for their customer service

Cons

  • The quality of individual insurance agents can vary greatly, and customers are often encouraged by other customers to talk with multiple agents before deciding who to use.
  • For those with poor credit, State Farm may not be the right option, because poor credit increases their premium exponentially.

State Farm Coverage

  • Emergency Road Service is available coverage, and includes up to an hour of time at a mechanic, a locksmith, towing, needed gas, or a battery charge. This is usually plenty of time to help someone that is stuck at the side of the road.
  • Ride-Share Drivers is for drivers of ride sharing companies like Uber and Lyft, and serves as an add-on to your personal insurance coverage, and is in affect while using the apps, and picking up passengers. If State Farm’s deductible is lower than the ride-share company’s, then you will only pay the smaller cost of the two.
Annual Mileage Average Rate 6,000 miles annually $1,115 12,000 miles annually $1,234

Standard Coverage

  • Collision coverage offers protection in case of an accident involving a collision, and will cover damage to your car.
  • Comprehensive coverage will protect your car against damage done to your car outside of an automobile accident.
  • Liability will pay for damages incurred by someone else personally, or if their property is damaged in a vehicle involving your car.
  • Uninsured protection will pay for damages done to your car by an uninsured driver.
  • Underinsured Motorist Coverage will cover the amount not covered by another person’s insurance due to lack of coverage in amounts high enough to pay for the damages received.
Coverage Type Average Rate
Low $1,143
Medium $1,234
High $1,327

Car Insurance Rates

After an evaluation of 10 different insurance companies it was proven that State Farm’s average premium was around $1,234, making it one of the lowest out there. Only two other insurance companies offered lower average premiums, and those were USAA and Geico.

Single 25-year-old drivers had average premiums of $1,469 for men, and $1,330 for women. If drivers were 35-years-old and married they had an average premium of $1,205 when using State Farm insurance, and if they were 60-years-old and married they had an average $1,098 premium.

Gender definitely plays a role in determining insurance premiums, and State Farm falls under that as well. When taking averages based on ages of 25-years-old, and we were able to determine average premiums according to those that have a clean driving record, to give people an estimated average cost of insurance. Single 25-year-old men have an average premium of $1,468.63, where as 25-year-old women have an average of $1,330.05, with State Farm insurance.

When it comes to the amount of mileage you’re going to put on your vehicle, State Farm’s rates don’t change that much. If you were to drive 6,000 miles a year you would pay $1,114 as an average premium, and profiles with a higher mileage rate would end up with an average of $1,234. The average savings for drivers putting 12,000 miles on their car, when using State Farm insurance, allowed them to save around 13%.

Another factor that plays into insurance rates is going to be a driver’s credit score. These next figures are going to be average rates for those with good credit, fair credit, and poor credit, that also have maintained a clean driving record. If a driver has good credit, the average State Farm rate will run around $1,231. When the credit of a driver is only fair, then the average rate from State Farm raises to around $1606. For those with poor credit, which unfortunately are considered a high risk, the rates jump up considerably to an average of $2,745. If you have poor credit, then you may want to shop around more, because State Farm’s average is on the higher side in regards to credit scores.

As expected, having a clean driving record will definitely affect your insurance premiums. On average, those that maintain a clean driving record, that are insured with State Farm, will pay $1,234 a year. To maintain a perfect driving record is almost impossible in the modern age. Accidents happen, and even though you’re not always at fault, they do still go on your record, as do speeding tickets. On average, one speeding ticket will raise your average rate to around $1,375, an accident will raise it to $1,487, and a DUI will increase it to around $1,681. Though these are increases, they are some of the lowest available, with State Farm offering one of the lowest increased rates for those that acquire a DUI.

These are averages all based on starting with a clean driving record, and that should be noted when looking for quotes from State Farm.

Car Insurance Discounts

State Farm offers a number of discounts, most of them based around driver safety.

  • Payoff Protector is similar to gap insurance, but is only available if your car is financed through State Farm’s Bank.
  • Drive Safe & Save is offered for any that have OnStar installed in their vehicle. State Farm will use that system’s data to determine the rate for each individual customer.
  • Steer Clear uses an app-based driving course for customers under the age of 25, ranking them based on their safe driving skills.
  • Rate Reductions applies to any policyholders maintaining at least three years without any accidents.
  • Good Grades offers a 25% savings for students that get good grades.

State Farm Insurance Vs. Competitors

Allstate Vs. State Farm: To give a bit of contrast and comparison for our insurance shoppers, we’ve taken a look at three competitors, and compared them with State Farm. The first company in our comparison will be Allstate, which unlike State Farm, is a publicly traded company that has shareholders focused on profits and expansion. Policyholders will save around 35% more if they go with State Farm over Allstate.

Geico Vs. State Farm: The next on the list is Geico, which tends to offer higher rates than State Farm if a driver has had a single accident, and if more than 40% higher than State Farm if a policyholder has received a DUI. The category where Geico comes out ahead, is if someone has poor credit, because their rates on average for poorer credit were $900 less than State Farms.

Farmers Vs. State Farm: Farmers insurance is the last one on our list of three, and their premiums on average run from around $400-$1000 more than State Farm’s.

Here is a list of annual rates for 9 of the most well-known auto insurance companies, from lowest to highest average annual rates:

  • USAA $885
  • Geico $1,168
  • State Farm $1,234
  • Travelers $1,267
  • Progressive $1,373
  • American Family $1,391
  • Farmers $1,682
  • Nationwide $1,864
  • Allstate $1,880
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