State Farm Auto Insurance Review
Known for its slogan, “like a good neighbor, State Farm is there,” State Farm Auto has been America’s neighbor for nearly a century. With more than 44 million auto insurance policies, State Farm covers more vehicles than any other provider in the United States.
The company has been instrumental in passing seat belt laws, promoting safe driving practices, and has received recognition for green initiatives and community involvement.
In this review:
State Farm Car Insurance Options
State Farm offers various types of auto insurance coverage.
Some of these coverages are legally required in certain states, while other coverages provide added financial protection for policyholders.
Below are just a few of the types of insurance coverage this insurer offers:
This coverage insures against the cost of repairing or replacing your vehicle if it collides with another vehicle or object.
Uninsured Motor Vehicle Coverage
This coverage pays for any expenses you incur if you are hit by a driver who does not have liability insurance.
Car Rental and Travel Expenses Coverage
This coverage reimburses the cost of renting a replacement vehicle while your vehicle is in the shop for repairs following an accident.
If the accident happens more than 50 miles from your primary residence, this coverage also pays for food, lodging, and other travel expenses.
Medical Payments Coverage
If an insured person or someone riding in his or her car is injured or killed in an auto accident, this coverage will pay for medical or funeral expenses.
Most drivers may only interact with their insurer when they need to file a claim.
Therefore, how auto insurance companies handle claims is one of the top drivers of customer satisfaction.
According to the 2017 J.D. Power claims satisfaction report, State Farm Auto’s overall claims satisfaction is on par with other providers.
This rating is based on three Key Performance Indicators including:
- Ease of service interaction
- How efficiently the claim was settled
Claimants gave average ratings for State Farm Auto’s initial claims reporting process, the performance of the insurer representative, the repair process, the rental process, and the fairness of their settlement.
The estimation process, in which the representative determines what damage is the result of the accident and negotiates with the shop for repairs, was rated to be above average.
While handling claims efficiently and fairly is one of the most important factors that influence overall customer satisfaction, there are several other aspects of customer service that affect a policyholder’s experience with his or her auto insurance provider.
Factors such as pricing, the variety of coverage options available, how well local agents and call center representatives are able to answer questions, and how easy the insurer’s website is to navigate all influence State Farm’s auto insurance ratings.
The J.D. Power shopping study compares State Farm Auto Insurance for overall customer satisfaction, as well as their policy offerings, pricing, local agent, and website. State Farm Auto had average rankings for policy offerings and local agents, but the company ranked below average in pricing and website interface.
How Does State Farm Compare?
These rankings place State Farm Auto above Travelers and MetLife and below Progressive and Esurance.
Customer complaints are not uncommon for auto insurance providers, particularly those that manage millions of policies. In California, the nation’s most populous state, State Farm Auto has received 120 justified complaints and is ranked 18 out of 50 according to the California Complaint Ratio Study.
It writes 3,852,920 policies in the state, and its justified complaint ratio is 3.1 complaints for every 100,000 policies. This puts State Farm Auto insurance ratings in the top 36 percent of the group.
There are numerous factors that influence what policyholders will pay for their coverage.
Aside from their coverage options and policy limits, factors such as age and gender, whether they park on a private driveway or in a parking lot at night, and how many miles they log annually all affect their monthly premium.
Consider the following scenarios:
- Single female (licensed 9 years): One car (Toyota Camry), one violation and one no-fault accident in the preceding 3 years, work driving use of 12,000 miles per year, and living in Pasco County, Florida
In the first scenario, State Farm Auto pricing comes in at number 12 out of 20 companies. The minimum coverage required by state law would cost $1,206, and complete coverage would cost $3,250.
These prices are at roughly the midpoint between the most expensive insurer for this demographic (Progressive American Insurance Company, with $2,925 and $8,278, respectively) and the cheapest insurer (United Services Automobile Association, with respective costs of $539 and $1,976).
- Single male (licensed 9 to 15 years): One car (Toyota Camry), one traffic ticket, driving between 12,600 and 15,000 miles per year, and living in Markleeville County, California
In the second scenario, State Farm Auto ranks among the pricier insurance providers, with state-mandated minimum coverage costing $1,143.
The lowest premium for state-minimum coverage is through CSAA Insurance Exchange and costs $518, and the most expensive premium is courtesy of IDS at $1,694.
Most drivers take it for granted that their auto insurance provider can cover their claims, however, an insurer that lacks financial strength may have difficulty doing just that. This could potentially slow down the claims process or result in an unfair settlement.
Therefore, financial strength is an element that should be taken into consideration.
State Farm Auto Insurance has received a rating of A++ from A.M. Best, which is the highest rating possible, for superior financial condition and performance.
Additionally, the company has received an AA rating from S&P Global Ratings, which is a very high rating that reflects the company’s strong claims-paying ability.
Keep these State Farm Auto insurance reviews in mind as you search for the best car insurance that will fit your needs and budget.