Here’s something you don’t see every day: an insurance company sending money back to its customers.
State Farm just announced a $5 billion dividend for auto policyholders this summer . That’s real cash heading to millions of mailboxes. And they’re dropping rates in multiple states at the same time .
If you’re shopping for car insurance, this is actually a pretty good moment to get a quote.
Let’s walk through what State Farm looks like in 2026, what you’ll pay, and how to get the best possible rate.
The Big Picture: Rates Are Moving in the Right Direction
For the past few years, watching insurance premiums was like watching gas prices—up and never really down. But 2026 is shaping up differently.
Rate Decreases Across Multiple States
State Farm has been rolling out rate reductions in several states. In Louisiana, drivers saw an average drop of 5.9 percent starting January 1, 2026 . State Farm insures more than 1 million policyholders there, representing about 30 percent of the market .
In Florida, the top five auto insurers—including State Farm—have lowered premiums by an average of 8 percent for 2026 . These companies account for roughly 78 percent of Florida’s auto insurance market . State Farm had previously announced cuts of about 10 percent for Florida drivers.
Officials credit legislative reforms passed in 2023 and 2025 for helping stabilize the market . The company itself points to decreasing claim costs and fewer accidents as reasons for these reductions .
The $5 Billion Surprise
Here’s the part that got everyone’s attention. State Farm announced a one-time $5 billion policyholder dividend—the largest in company history .
What this means for you:
- Average payment: About $100 per vehicle
- Eligible customers: Approximately 49 million personal auto policyholders
- Who qualifies: Anyone who had an active personal auto policy with State Farm in 2025
- Timing: Payments start summer 2026
- Form: Real checks or direct deposits, not credits to your account
The company’s president explained it simply: as a mutual company owned by policyholders, when they have a stronger year financially, they share the surplus directly with customers .
The $100 is an average. Your actual amount may vary based on your state and the premiums you paid.
What Will You Actually Pay?
Let’s talk real numbers. According to rate analysis, State Farm’s average annual premium for full coverage runs around $2,030, which works out to about $169 per month. For minimum coverage, the average is $650 annually or $54 monthly .
Compared to the national average, State Farm comes in about 14 percent lower .
But averages only tell you so much. Your actual quote will depend on who you are, where you live, and what you drive.
| Driver Profile | State Farm Average Annual (Full Coverage) | National Average |
|---|---|---|
| Good driver, good credit | $2,030 | $2,356 |
| Driver with speeding ticket | $2,062 | $2,730 |
| At-fault accident | $2,401 | $3,156 |
| DUI on record | $2,947 | $4,461 |
| Poor credit | $9,172 | $4,126 |
| Senior drivers | $2,078 | $2,248 |
Notice something interesting? State Farm is very competitive in most categories but can get expensive for drivers with poor credit . If that’s your situation, it’s worth getting quotes from several companies.
How State Farm Stacks Up by City
Looking at specific cities gives an even clearer picture of State Farm’s pricing.
Honolulu, Hawaii
In Honolulu, State Farm ranks among the cheapest insurers for several driver profiles according to WalletHub’s 2026 analysis :
| Driver Profile | State Farm Annual Rate (Minimum Coverage) |
|---|---|
| Good driver | $347 |
| Full coverage | $1,111 |
| After a ticket | $386 |
| After a DUI | $386 |
| After at-fault accident | $425 |
| Young driver | $347 |
| Older driver | $347 |
Texas
In Texas, State Farm emerges as the cheapest option across multiple categories :
| Driver Profile | State Farm Monthly Rate |
|---|---|
| Full coverage | $112 |
| Good drivers | $33 |
| Older drivers | $31 |
| After a ticket | $33 |
| After at-fault accident | $42 |
| After DUI | $61 (second cheapest) |
| Young drivers | $87 (third cheapest) |
State Farm’s average monthly rate in Texas is $73, second only to Texas Farm Bureau at $70 .
What Goes Into Your Quote?
Understanding what State Farm looks at can help you position yourself for the best rate .
Your Driving History
This matters most. A clean record for three to five years puts you in the sweet spot for the best rates. Minor speeding tickets usually affect your rates for about 36 months. More serious issues like at-fault accidents and DUIs can impact pricing for five years or longer .
Here’s a pro tip: if you had a violation that just fell off your record, get a new quote immediately. Some drivers save 12 to 18 percent overnight when an old surcharge drops off .
Your Vehicle
The car you drive matters more than most people expect. A midsize sedan with standard safety tech often rates cheaper than a compact sports model with the same sticker price .
If you’re shopping for a car and the budget is tight, ask a State Farm agent to run sample rates on your final two or three options before you sign. Shaving $35 a month off premium could free up over $1,200 over a three-year ownership cycle .
Where You Park at Night
Your zip code carries significant weight. Garaging on a quiet street in a low-theft ZIP can save 20 percent or more compared to dense urban zones with heavy traffic and higher claim costs .
In Texas, rates vary dramatically by city. Drivers in Waco pay around $1,397 annually while those in Houston pay $2,128—a difference of more than $700 per year just based on where you live .
Your Credit
In most states, your credit-based insurance score affects your rates. Where permitted, they can shift rates by 30 percent or more between tiers . If you recently paid down revolving balances or cleaned up old errors, ask for a re-rate. It’s not unusual to see a mid-term credit improvement reduce price after the next payment cycle .
How Much You Drive
Two drivers with identical vehicles can see a 10 to 25 percent swing purely on how many miles they drive and when . If you work from home or don’t drive much, mention that.
Three Ways to Get a Quote
State Farm gives you options. Choose the one that fits your style.
Online Through the Website
This is the fastest route. The online quote process takes about 10 to 15 minutes. Have these things ready :
- Your full name, address, and date of birth
- Driver’s license numbers for everyone on the policy
- Vehicle details with full VINs
- Current odometer readings
- Your current insurance information if you have it
- Annual mileage estimates
The system generates a quote you can review right away. You can buy online or connect with an agent to finalize.
Through the Mobile App
The State Farm app, available on both iOS and Android, now offers quoting functionality . It’s handy if you prefer using your phone, and you can save your progress if you need to step away. The app has earned strong ratings with millions of users.
With the app, you can also manage your policies, file claims, request roadside assistance, and access your digital insurance cards. The latest version includes enhanced crash detection that can automatically connect you with emergency services if it detects a collision .
With a Local Agent
This is where State Farm really stands out. With thousands of agents across the country, you can sit down face to face and talk through your options .
A thoughtful session with a State Farm agent often uncovers misalignments you would miss on your own . An agent can explain coverage choices in plain English, spot discounts you might miss online, and answer questions the automated tools don’t cover.
Bring your objectives to the conversation. Are you optimizing cash flow this year, or protecting a growing asset base for the next decade? The best agents will ask about how long you keep cars, who commutes, where cars park at night, and what changed since your last policy .
Understanding Your Coverage Options
When you get your quote, you’ll need to choose coverage levels. Here’s what each piece does .
Liability Coverage
This pays for damage you cause to others. It’s required everywhere. Many drivers carry 100/300/100 ($100,000 per person, $300,000 per accident, $100,000 property damage). While better than state minimums, this can still fall short in a serious multi-vehicle crash .
If you own a home, have savings, or future wages to protect, stepping to 250/500/100 often costs less than dinner out each month. Some drivers see quotes move from 100/300/100 to 250/500/100 for just $8 to $15 per month .
Uninsured/Underinsured Motorist Coverage
This protects you if you’re hit by someone without insurance or with too little to cover your damages. In states with high uninsured rates, matching your UM/UIM limits to your liability coverage is pragmatic .
Collision and Comprehensive
Collision pays for damage to your car from accidents. Comprehensive covers damage from things other than collisions: theft, vandalism, fire, falling objects, weather events, and animal strikes.
A common money-saving move is raising both deductibles from $500 to $1,000. On many vehicles, that saves $12 to $25 per month . The trade-off: you take on an extra $500 of risk per incident.
If you drive an older paid-off car with a market value under $4,000, consider a version of the quote that drops collision but keeps comprehensive. You still protect against fire, theft, and storm damage at a relatively low cost, but you stop paying for collision when the payout would be marginal after a deductible. This change can save $300 to $450 a year .
Optional Protections Worth Pricing
Rental Reimbursement: If you commute long distances, rental coverage can be a lifesaver when your car is in the shop. Set limits that reflect real rental costs in your area. $25 per day barely covers an economy car in many markets. $35 to $45 per day for up to 20 or 30 days is more realistic when parts shortages stretch repairs .
Roadside Assistance: For about $24 to $30 per year, this covers towing, jump starts, flat tire changes, lockout help, and fuel delivery. Well worth it if you have an older car or do much highway driving.
Gap Coverage: For leased or financed cars, loan or lease gap coverage is critical. If the car is totaled, gap pays the difference between the loan balance and the actual cash value payout .
Rideshare Endorsement: If you drive for a rideshare platform, ask about rideshare endorsement options where available. Personal policies often do not cover the period when the app is on and you’re awaiting a ping. A small monthly endorsement can fill that hole .
Discounts That Add Up
State Farm offers plenty of ways to save. Ask about every one you might qualify for .
Multi-Policy Discount
Bundle your auto with home, renters, or life insurance. According to State Farm, a household can save an average of $1,127 per year by purchasing both home and auto insurance from them .
Drive Safe & Save
This telematics program tracks your driving through a mobile app or a small transponder placed in your vehicle . You get a discount just for signing up, with additional savings based on your actual driving.
According to a senior editor at AutoInsurance.com who uses the program, you can save up to an additional 30 percent at renewal depending on your driving habits . Importantly, Drive Safe & Save will never increase your premium or add a surcharge to your insurance .
The app tracks your speed, acceleration, braking, cornering, and phone use while driving. If you’re a smooth driver, this program can deliver meaningful savings.
One important note: the discount is calculated 60 to 90 days before your renewal. If you sign up late in the policy period, you may not have enough data for a full discount at your next renewal . Set it up as soon as possible.
Good Student Discount
High school and college students with a B average or better qualify for up to 25 percent off . Keep transcripts handy. Good student credits can run through age 25 as long as grades and enrollment meet the threshold.
Defensive Driving Course
Completing an approved course can earn a discount in certain states and for certain age groups. An online class over a weekend can yield two to three years of savings .
Vehicle Safety Features
Anti-lock brakes, air bags, anti-theft devices, and advanced safety systems like automatic braking and forward collision warning qualify for discounts.
Accident-Free Discount
Staying claim-free for three years or longer earns you a discount.
Payment Discounts
Setting up automatic payments, going paperless, or paying your full premium upfront saves a little. Together, these small discounts can total a month of premium over a year .
How One Policyholder Saved Nearly $250
A senior editor at AutoInsurance.com shared their personal experience with State Farm . At their six-month renewal, their premium increased by about 20 percent. However, working with their agent, they managed to adjust the policy so the increase was less than 5 percent.
The savings breakdown:
- Increasing collision deductible from $500 to $1,000: Saved $18 monthly
- Applying low mileage discount: Additional savings
- Drive Safe & Save discount recalculated: More savings
Combined, these steps saved nearly $250 on their six-month policy .
The lesson: to get the most out of your State Farm policy, make sure you’re applying all possible discounts and review your coverage choices with your agent at renewal time.
Smart Tips for Getting Your Best Quote
Prepare Your Facts First
Good quotes start with clean data. Bring details for each household driver, all vehicles with full VINs, current odometer readings, and garaging addresses .
Gather facts on your current policy too, including limits, deductibles, endorsements, and renewal date. Having these numbers prevents apples-to-oranges comparisons .
Request Two Quotes
Consider asking for two State Farm quotes at the outset :
- First, a match of your current coverage structure
- Second, a proposal that aligns with State Farm’s discount architecture and the agent’s recommendations
Seeing the difference teaches you where State Farm is tight or generous for your profile.
Compare Both National and Regional Insurers
Don’t forget to include local insurance companies in your search. In Texas, regional insurers like Texas Farm Bureau might have lower rates than national companies .
Maintain Continuous Coverage
Any lapse in coverage can have a serious impact on your rates. Texas drivers who don’t maintain continuous coverage pay an average of 20 percent more than those with five or more years of insurance history . Maintaining coverage, even if you don’t own a car, can help keep your rates low for the long term.
Review Every Year
Your needs change. Maybe your car is older and you don’t need collision anymore. Maybe you added safety features. Maybe your credit has improved. Schedule an annual review with your agent.
What Customers Say About State Farm
Analysis of over 19,500 customer reviews reveals common themes :
| Category | Summary |
|---|---|
| Top Positives | Competitive pricing with bundling, personalized support from helpful local agents, strong financial backing |
| Top Negatives | Some frustrations with complex claims or settlement delays, rate increases over time, inconsistent service depending on agent |
Real customer feedback:
“Been with them 30+ years with multiple auto and one major home claim. Never had a problem.”
“I always say you get what you pay for. I’ve been with State Farm for years and have had both an auto and home claim. Both went as smoothly as they could’ve gone.”
Frequently Asked Questions
How long does a State Farm quote take?
Online quotes run about 10 to 15 minutes. Talking with an agent might take a bit longer but gives you more personalized advice.
Can I get a quote without talking to anyone?
Yes, the website gives you a full quote online without any phone calls.
Does State Farm check my credit?
In most states, yes. This helps determine your rate.
Will getting a quote hurt my credit?
No. Insurance quotes use a soft inquiry that doesn’t affect your score.
How soon can coverage start?
Usually the same day. Just tell them when you want it to begin.
Can I get a quote with a bad record?
Yes. State Farm insures drivers with various histories, though rates will be higher.
When’s the best time to get a quote?
About 30 to 45 days before your current policy renews. Gives you time to compare without feeling rushed .
How do I cancel if I switch?
You can cancel at any time with no cancellation fee. Just talk to your agent or call customer service. They’ll prorate your premium and refund the difference.
How do I find my local agent’s direct number?
Log in to your online account, use the agent finder tool on the State Farm website with your ZIP code, or call the main customer service line during business hours to be connected.
The Takeaway
State Farm offers solid rates for most drivers, with especially good pricing for those with clean records and good credit . Their local agent network provides personal service that online-only companies can’t match, and their mobile app delivers modern convenience .
For 2026, rates are trending downward in many states thanks to legislative reforms and decreasing claim costs . The $5 billion dividend means existing customers will get money back this summer .
A few minutes of effort getting a quote could save you hundreds. That’s a pretty good return on investment.
Quick Facts Summary
