INSURANCE - CAR INSURANCE

State Farm Auto Insurance Review [2024]: Is it Overpriced?

Updated Sept. 19, 2024
Fact checked
State Farm has longevity, stability, and customer service on its side, but are its premiums worth it?

Compare car insurance rates in Ohio

See if you qualify for a lower rate in less than 2 minutes

By clicking the button below I understand and agree that this site uses site visit recording technology (provided by Trusted Form, Jornaya, and Microsoft Clarity) Privacy Policy

Check Rates

FAST, EASY & FREE

We receive compensation from the products and services mentioned in this story, but the opinions are the author's own. Compensation may impact where offers appear. We have not included all available products or offers. Learn more about how we make money and our editorial policies.

Everyone knows about State Farm and its exceptional insurance products, but like most people, I think it’s somewhat overpriced based on what you can get elsewhere. With its recent financial ratings decreasing, there’s plenty of reason to shop around and ensure you’re getting the best coverage at the best prices.

State Farm does offer a variety of discounts, especially for people with good driving records or looking for multiple policies from one company. Its insurance might be a good fit for student drivers, people with multiple vehicles or policies, and people with a clean driving record and good credit.

State Farm auto insurance pros and cons

Pros
  • A++ rating from insurance rating agency AM Best
  • Offers usage-based discounts
  • Large selection of insurance products
  • Exceptional customer service ratings
Cons
  • High premiums overall
  • Potentially higher rates than other insurance companies for drivers with poor credit or a history of accidents
  • Recent complaints about payouts

State Farm Auto Insurance overview

State Farm has more than 19,000 independent agents and 67,000 employees. In 2023, State Farm handled $53.4 billion in auto insurance claims and took the top spot in the J.D. Power 2023 U.S. Insurance Shopping Study℠.

What types of car insurance does State Farm offer?

You have many options when considering State Farm for your auto insurance to customize a policy to fit your specific needs. I suggest that as you consider the best way to save money on car insurance, balance the total cost with coverage options so you have proper protection.

Liability and protection coverage

State Farm offers several types of auto insurance coverage to protect you and other drivers in an accident, including:

  • Liability coverage: Liability insurance helps to pay for medical expenses, property damage liability, or vehicle repairs the other driver in an accident might need if you caused the accident.
  • Collision insurance: Helps pay for repairs or replacement of your car if you are hit by another vehicle or object. Many lease companies and auto lenders require collision insurance.
  • Comprehensive insurance: Assists in covering damage caused by something other than a collision, including theft, fire, vandalism, storms, or if you hit an animal, among other things. Some auto financing and lease companies also require comprehensive insurance.
  • Medical payments coverage: If you or your passengers are injured in an accident, this coverage helps to pay your medical bills along with your existing health insurance.
  • Personal injury protection (PIP): This coverage is similar to medical payments coverage, but in addition to bodily injury, it might also cover lost wages or services like house cleaning if you aren’t able to take care of normal tasks due to a car accident.
  • Uninsured or underinsured motorist coverage: Uninsured motorist coverage kicks in if you’re involved in an accident with someone who doesn’t have insurance or doesn’t have enough coverage to pay for your medical or repair bills.

Emergency coverage

State Farm also has several additional coverage types that aim to make your life easier on the road. These coverage options include:

  • Emergency road service coverage: Helps cover the cost of roadside assistance you may need on the road, such as towing to a repair facility, gas delivery, a new tire, and locksmith services.
  • Car rental and travel expenses: This coverage helps you with the cost of renting a car if your car was damaged in a covered incident, while it gets repaired. It may also cover your travel expenses if you’re in an accident more than 50 miles from home.

Rideshare insurance

If you drive for a rideshare company, it’s best to consider insurance outside of what Uber or Lyft offer. State Farm offers rideshare insurance that covers drivers and passengers while you’re active on either app and extends the personal coverage you have on your vehicle.

Additional insurance products

Like many insurance companies, State Farm offers additional discounts to people who bundle multiple policies with the same company. The insurance products that could be bundled with State Farm auto coverage include:

  • Homeowners insurance.
  • Renter’s insurance.
  • Condo insurance.
  • Life insurance.
  • Multiple auto policies.

Warning
It’s important to note that not all coverage types are available in all states. If you live in Rhode Island or Massachusetts, you may not be able to find coverage through State Farm.

State Farm auto insurance discounts

When learning how to get car insurance that covers your needs and has a manageable deductible is essential, the monthly insurance cost is also a significant consideration. While every driver will have different premiums based on qualifying factors, State Farm claims they save the average household $649 a year when they switch car insurance carriers, but their premiums are often higher than competitors due to its robust offerings and stable history.

State Farm discounts

Like most insurance companies, State Farm offers various discounts, including:

  • Multi-policy discount: If you also have a home, condo, renters, or life insurance policy with State Farm, you may receive an additional discount for bundling it with your auto policy.
  • Multi-car discount: This discount applies if you’re a policyholder with two or more cars insured with State Farm.
  • Safe driver discount: New State Farm customers who have had no moving violations or at-fault accidents for three or more years may be eligible for this discount for being a good driver.
  • Accident-free discount: If you insure a car with State Farm for three or more continuous years without an accident, you might be eligible for a discount.
  • Defensive driving course discount: Depending on where you live, this discount may apply if covered drivers take an approved defensive driving course.
  • Vehicle safety discount: Car models produced in or after 1994 might receive this discount since their production followed higher safety standards. Eligibility depends on the make and model of your car.
  • Passive restraint discount: This discount may apply to vehicle models from 1993 or older with factory-installed airbags or other passive restraint systems that meet federal safety requirements.
  • Anti-theft discount: If your car has an alarm or other approved anti-theft device, you might receive an additional discount.
  • Good student discount: Any drivers under age 25 who are full-time students and meet specific educational criteria may receive an additional discount.
  • Student away at school: This discount might be available if you have a student who attends school more than 100 miles from home and the car they use stays at your residence for the school year.

Discount programs

State Farm also has two discount programs to help drivers save money by monitoring their driving habits. These programs are:

  • Drive Safe & Save: This is a usage-based discount that provides a small initial discount for signing up. If you practice safe driving habits over time, you may receive a discount of up to 30% when you renew your policy. This program uses a phone app or a device that connects to your car to monitor your driving habits.
  • Steer Clear: State Farm offers training to encourage safe habits for drivers younger than 25. Participants watch videos and take courses through the Steer Clear app. Then, they would practice with a family member who logs into the app to provide feedback. Upon completion of the program, the young driver receives a certificate to send to their State Farm agent to implement the discount.


Tip
Even though State Farm offers many discounts, drivers with poor credit or accident history may find its premiums higher than other insurance companies. Comparing auto insurance rates across multiple companies is always a good idea as you search for the best car insurance company.

How to maximize savings

There are many factors that affect car insurance rates, including the following:

  • Driving record
  • Age
  • Gender
  • Car safety rating
  • Credit score
  • Marital status
  • Your location

These factors affect how much you pay for insurance, as does the amount of coverage you select and the deductible amount. While most states require at least a minimum amount of insurance or have financial responsibility laws, beyond that, the amount of coverage you choose is up to you and your budget.

A few ways to lower your premium include:

How to get an insurance quote from State Farm auto insurance

I found that the quote process with State Farm is simple. I love that you can get a quote online, but also have the option to contact an agent if you need help.

Keep in mind that you may have to contact an agent directly for any specialty quotes, such as motorcycle, RV, or commercial vehicle insurance.

Before starting the quote process, I recommend gathering the following information and applicable documents:

  • Driver name and date of birth
  • Driver’s license number and state
  • Ticket and accident history
  • License suspension information
  • Year, make, model, body style, and vehicle identification number (VIN)
  • Mileage
  • Ownership and name of the registered owner
  • Date of purchase
  • Prior insurance carrier and expiration date
  • Garaged address

FAQs

Is State Farm good at paying claims?

State Farm has had some recent complaints about their claims process and their financial strength rating fell from an A (excellent) to a B (fair) in 2024. While many people state they are pleased with the claims process, the Better Business Bureau gave them a C- rating with 1,928 complaints in the last 12 months.

It’s easy to file a claim with State Farm, though. You could file it on the State Farm app or website and have a representative contact you for assistance if necessary. Its website and app allow you to upload photos, track a claim, and select a mechanic or body shop without having to go through the phone.

Is State Farm a good auto insurance company?

State Farm has received high industry rankings from multiple sources, including the J.D. Power U.S. Insurance Shopping Survey for 2023. The company offers various discounts and programs to help you save money. Its insurance policies are available in every state except Massachusetts and Rhode Island.

While its claims process and overall satisfaction with payouts is questionable lately, they have a long and stable history of customer satisfaction.

Is State Farm overpriced?

State Farm offers competitive rates that might be lower than its competition in some cases. Insurance rates vary based on several factors, including your driving history, location, and vehicle make and model. Be sure to compare rates and coverage options among several companies before signing up for auto insurance.

Bottom line

State Farm is an auto and home insurance industry leader and has a century of experience in the insurance industry. While I believe they don’t have the lowest premiums in the industry, if you do your best to qualify for most of their available discounts, you can get competitive premiums.

State Farm began in 1922 and has a proven stable history and according to the National Association of Insurance Commissioners (NAIC), they are one of the biggest auto insurance providers in the U.S. and has several strong financial and customer satisfaction ratings.

While it's always wise to compare premiums and coverage offerings, State Farm may be a good choice for many people based on their average rates, customer service history, and industry standing.

Methodology

FinanceBuzz researches a number of factors in each auto insurance provider to create our reviews. These factors include cost and discounts, complaints and customer satisfaction, coverage, and ease of use. We also gather information from sources such as J.D. Power, AM Best, the National Association of Insurance Commissioners (NAIC), and the Better Business Bureau to ensure we provide the most useful information to our readers.

  • You could save up to $600 with some companies
  • Compare dozens of providers in under 5 minutes
  • Fast, free and easy way to shop for insurance
  • Quickly find the perfect rate for you