State Farm life insurance

Overview

State Farm is best known as the country's largest auto and home insurer, but its two life companies, State Farm Life Insurance Company and State Farm Life and Accident Assurance Company, form one of the biggest individual life insurers in the United States. The State Farm group ranked #6 among U.S. life insurance groups by 2024 individual life direct premiums written, according to NAIC market share data, with $5.89 billion in premiums and a 3.77% market share.

Both life companies are stock companies wholly owned by State Farm Mutual Automobile Insurance Company, which is a mutual owned by its policyholders rather than by shareholders. State Farm sells life insurance only through its own agents, who are independent contractors that represent State Farm exclusively, a model the industry calls captive agents. The group reports more than 19,200 agent offices.

For 2025, the life companies reported $6.9 billion in premium income, $2.1 billion in net income, a record $130 billion of new coverage issued and $1.22 trillion of individual life insurance in force at year-end, according to State Farm's 2025 results release.

History

George J. Mecherle founded State Farm Mutual, an auto insurer owned by its policyholders, in Bloomington, Illinois, on June 7, 1922. According to State Farm's corporate history, agents pressed for a life company as early as 1925, because a rival life agent was often waiting to approach the same customers. Mecherle wanted the auto company established first. State Farm entered life insurance in 1929: the first policy was sold to Mecherle himself on April 29, 1929, and the life company issued about 2,000 policies in its first year.

State Farm Life later added a second company, State Farm Life and Accident Assurance Company, which today serves New York and Wisconsin residents. State Farm stopped selling variable products on September 27, 2008, and now services its existing variable universal life policies through a separate Variable Operations Center. Neither life company is licensed in Massachusetts, so State Farm does not sell life insurance there; its site says it plans to offer several products in Massachusetts starting in early 2027.

Life insurance products

State Farm keeps a short, traditional product list.

• Select Term comes in 10-, 20- and 30-year level periods, starting at $100,000 of coverage. Issue ages are 18 to 75 for the 10-year term, 18 to 65 for 20 years and 18 to 45 for 30 years. After the level period, coverage renews yearly to age 95 at rising premiums capped by a maximum stated in the policy. Any State Farm term policy can be converted to permanent coverage regardless of health, with options that vary by state (how term conversion works).
• Return of Premium Term runs 20 or 30 years and refunds premiums if the insured outlives the level period.
• Instant Answer Term provides $50,000 of coverage to age 50 or for 10 years, whichever is longer, with an underwriting decision in the agent's office and no physical or medical tests.
• Whole life is participating, so it can earn dividends, which are not guaranteed. It comes as ordinary whole life, limited pay over 10, 15 or 20 years, or single premium.
• Guaranteed Issue Final Expense offers $10,000 to $15,000 to applicants aged 45 to 80 with no health-based declines. It is not sold in New York, where a separate Guaranteed Issue Whole Life covers ages 50 to 75 (final expense insurance: what it covers and costs).
• Universal life has flexible premiums and coverage starting at $25,000 or $50,000 depending on age, issue ages 0 to 85, and survivorship (second-to-die) and joint (first-to-die) versions.

Riders include waiver of premium for disability, a children's term rider (up to $20,000 per child), Select Term and Level Term riders that add coverage for a spouse or other person, a guaranteed insurability option and the Flexible Care Benefit Rider, which pays a monthly share of the death benefit for qualified long-term care (not available in Massachusetts, New York or Rhode Island).

Other products

State Farm's life companies sell a single premium deferred annuity (Future Income Plus) and a single premium immediate annuity (Guaranteed Income). State Farm agents also offer health, disability and long-term care coverage, and the group makes some third-party products, including variable annuities, available through its agents.

Buying and service

You cannot buy a State Farm life policy entirely online. The site shows sample term rates and collects quote requests by state, but applications go through a local State Farm agent, who also handles most policy changes. That suits people who want face-to-face help and makes comparison shopping harder, because a captive agent cannot quote other companies (captive vs independent life insurance agents). Owners of variable universal life policies can call the Variable Operations Center at 888-702-2307. Supplementary contracts, such as settlement options and immediate annuities, are serviced by the Life Company ASC at 800-631-4545.

Claims

Beneficiaries can report a death to a State Farm agent or call Life Claims at 877-292-0398. Claims can also be mailed to State Farm Life Insurance Company, Life Claims, P.O. Box 2364, Bloomington, IL 61702-2364. Within about one to two business days of the notice, the Life Claims office reviews it and mails or emails the beneficiary an acknowledgment letter with the claim forms. If an agent is assigned to the policy, the agent gets a copy and can help. Beneficiaries who receive a key code can complete the beneficiary form online. Payment requires the completed forms and adequate proof of death.

State Farm says it processes payment in about one to three business days after it receives and reviews everything it needs. The lump sum then takes about 10 business days to arrive by check, or two to three business days by electronic funds transfer.

Ratings and reputation

On November 14, 2025, AM Best downgraded both State Farm life companies to A+ (Superior) from A++ and moved the outlook to stable from negative. The rating agency said the change removed rating lift from the wider State Farm group, which it downgraded at the same time. AM Best also said State Farm Life keeps the strongest level of risk-adjusted capital on its scale and has been profitable in each of the past five years.

In the J.D. Power 2026 U.S. Individual Life Insurance Study, released in October 2026, State Farm ranked 2nd of 23 brands with 692 points, behind Nationwide (701) and above the 649 study average. It was also 2nd in 2025, after ranking highest five years in a row through 2024.

The best-known legal fight involves universal life charges. In Vogt v. State Farm Life Insurance Co., a Missouri class of roughly 25,000 owners of one universal life policy form argued that State Farm built factors into its cost of insurance charges that the policy did not list. A jury awarded $34.3 million in 2018, and the Eighth Circuit upheld the verdict in June 2020. In December 2021 it also upheld about $4.5 million in prejudgment interest. Similar suits followed in other states (cost-of-insurance lawsuits against life insurers: cases and outcomes).

Who it suits

State Farm suits households that already have a State Farm agent and want simple term, whole or universal life from someone they know, with term coverage that converts to permanent insurance regardless of health. It is a weaker fit for people who want to apply online, compare several companies with one agent, or buy indexed or variable products, which State Farm does not sell.

• Strengths: Very large, profitable life operation with $1.22 trillion in force at the end of 2025; State Farm ranked first or second in J.D. Power's life study every year from 2020 through 2026; participating whole life from companies that paid a record $924 million in policyholder dividends for 2025; term conversion regardless of health.
• Weaknesses: Sold only through State Farm agents, with no fully online purchase; no new sales in Massachusetts; no indexed or variable universal life; AM Best lowered its rating one notch to A+ in November 2025.

How to contact State Farm