state farm business plan for new agents

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State Farm Agent Business Plan Template

NOV.11, 2021

State Farm Agent business plan for starting your own business

A thoughtful business plan is required to build a successful insurance agency. Are you planning to start your insurance agency? For that, you need a well written and well-thought business plan.

The insurance agents, also known as insurance sales agents are involved in a variety of things. These include life insurance, property insurance, health insurance, long-term care insurance and disability insurance.

If you are interested to start a business in this industry and to know how to start a state farm agency, continue to read this state farm agent business plan. Just like our previous business plan for ecommerce , we have mention all the required steps to start your business.

No matter if you want to write indoor shrimp farm business plan , business plan for farmers market , oyster farming business plan , landscaping business plan , pig farming business plan or mushroom growing business plan , you can use this template for all kinds of purposes.

Executive Summary

2.1 the business.

Lifeline Insurance Company will be a registered general insurance company in New York. It was incorporated under the law of the US as a private Limited Liability Company.

We plan to transform into a Public Limited Liability Company in the future. So that we can get listed on the Stock Exchange of New York.

When starting a state farm agent business, you should be aware of becoming a state farm agent pros and cons. Also, similar to the landlord business plan , it is important to mention the management, customers and target of the business.

2.2 Management of State Farm Agent Business

When writing a state farm business proposal, it is necessary to plan everything before starting the business.

Lifeline Insurance Company will work on making its management strong that can support the growth of the company. We will make sure that we hire highly qualified and experienced people to help us in building the dream company.

The management body of our company mainly comprises the CEO, head of claims and premium collection, marketing executive, HR manager, accountant and customer care representatives.

2.3 Customers of State Farm Agent Business

The Lifeline insurance company will target small businesses and medium-sized businesses in and around the heart of the US – New York City. We will also make efforts to grow and sell our insurance policies in the other cities of the US as well.

Our customers will be from the US and other countries from the world. We have listed down the customers that we have designed our services and products for

• Entrepreneurs
• Corporate organizations
• Real Estate owners
• Blue Chips Companies
• The Government
• Sports Organizations

In state farm agent business plan example available online, you can find many other customers that an insurance company has.

2.4 Business Target

We plan to make the most out of state farm agent signing bonus. We are optimistic to become one of the most popular insurance companies in New York in the next 5 years.

Our primary goal is to cover all the investment in the next 3 years of our launch. Our secondary goal is to ensure that our customers are satisfied with our services and they get their claims when due without unnecessary delays.

We want to get included in the list of companies who are generating large revenue and are most trusted by people.

State Farm Business Plan – 3 Years Profit Forecast

Company Summary

3.1 company owner.

Neil Fred will be the CEO of Lifeline Insurance Company. He will be responsible for providing direction to the business. Neil completed his degree from the University of London in Insurance and then decided to start his agency instead of doing a job. Neil knew that this industry is global and wide and he can make a lot out of it.

Keeping in view all these points, he decided to start a state farm agency program. He worked on all the things required for opening a state farm agency. He got the personnel and financial plan required in starting a state farm agency.

3.2 Why the State Farm Agent Business is being started?

Neil made research on the insurance market and got an idea of the profit he can make from starting a general insurance company. This business is a kind of business that never goes into loss. He first thought to start an insurance company in a specialized area.

Later when he realized that he can excel in the general market, he decided to open a general insurance company. Remember, in any state farm business plan sample, it is necessary to mention why and how the business is started.

3.3 How the State Farm Business will be started?

Starting an insurance company can be challenging. It is never easy to break into the industry. The insurance business is a business venture that is recession-proof and can stand the test of time. We have listed down the important steps you need to take to open your insurance business.

Make a research

If you do not have experience working as an insurance agent, it is important to have a thorough understanding of the insurance industry. Before you step into the world of insurance, make sure that you understand the necessary terms and concepts. When you completely understand the insurance products, terms, management skills, and sales savvy, you will be able to run this business successfully.

A business plan is required

Before starting any kind of business, a strong and well-thought business plan is required. Your business plan will decide how you are going to get the clients and how will you differentiate yourself from other insurance companies. When you write a business plan for your business, you will get a direction and vision for your business.

Get a license

To start an insurance company, you need to get a license. If you are planning to open an insurance company in the US, you need to get a license from the Association of Insurance Commissioners. This step is time-consuming but without it, you cannot start an insurance company.

Secure Financing

Certain factors decide how much investment you need to start an insurance business. These factors include your location, business model and more. People who are working independently with no or few staff members will have minimum expenses to cover. While larger agencies need more money to start and run their businesses.

Access to Insurance Carriers

To sell insurance, you need to get in contact with the insurance carriers. The insurance carriers affiliate themselves with the insurance companies that want to sell their products.

Promote the business

After you have made a strong business plan, got a license, secured your financing and affiliate yourself with the insurance carriers, the last but not the least step is to promote your business.

In the state farm agent business plan, it is necessary to mention all the services that your insurance company will provide.

When you open a state farm agency, you list down all the services you want to offer to your clients. When Neil was planning to start a state farm agency, he decided to provide the following services:

• Life & Health Insurance
• Property & Vehicle Insurance
• Disability & Group Insurance
• Agriculture & Travel Insurance

These services vary from state farm business to business.

Marketing Analysis of State Farm Agent Business

In the state farm business plan for new agents, the marketing analysis is necessary to mention. Neil wanted to get through this step smoothly so he got the services of marketing experts.

To start and run a successful business, solid state farm agent business plans are required. In all the state farm business plan examples, you will find this important part of the marketing analysis of a business.

No one can deny the importance of marketing analysis because whether the business is going to fail or succeed heavily depends on it. Marketing analysis forms the basis of many important decisions and steps in running a business. The state farm marketing plan include market trends, market segmentation, business target and product pricing.

5.1 Market Trends

The US has the largest number of insurance companies in the world. In a research made in 2013, the total gross premium on a global scale was 4.640 trillion US dollars, out of which 1.274 trillion was only written in the US. This figure shows how big the insurance market is in the US.

One common trend in the insurance industry is the existence of small insurers as single corporations. They partner up with holding companies. It has a lot of benefits because the survival of single insurance companies after turbulence is pretty low.

5.2 Marketing Segmentation

In the insurance industry, markets are segmented into different groups. The products or services offered by an insurance company are tailored to match the needs of the client. The advantage of marketing segmentation is to help the insurance organization identify the needs of their customers.

The marketing segmentation for our insurance company will be following:

State Farm Business Plan – Marketing Segmentation

Household sector

The household sector will include retired and self-employees and salaried staff.

Corporate sector

This sector will include big and small businesses.

Industrial sector

The industrial sector will include industries and manufacturers.

Organizations

This sector includes all kinds of organizations and institutions.

5.3 Business Target

The state farm mission statement includes the business target that a company aims to achieve. The business target of Lifeline General Insurance Company is to become one of the top companies in the US.

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We aim to expand our state farm insurance franchise to other cities of the US as well. We are optimistic to cover all of our investment in the next 5 years of our launch.

5.4 Product Pricing

In the insurance industry, there is an established trend in pricing the products. Pricing the products and services depends upon the risk involved in the insurance policy covers. This calculation is done by the experts who keep in view all the aspects and then give the pricing.

The Lifeline Insurance Company will sell its insurance products and services at a low rate as compared to other insurance companies in town to increase our sales and customers.

Marketing Strategy for State Farm Agent Business

In every state farm agent business plan sample, you will find the marketing strategy because it is an important component in every state farm agent business proposal.

To make your insurance business run successfully, aggressive marketing is extremely important. It is why there are always men and women selling their insurance cover to people.

To survive in this industry, you need to be prepared to spend a lot of money on marketing and advertising your business to promote your products. There should be a strong marketing team that come up with unique and innovative ideas that can catch the attention of potential clients.

6.1 Competitive Analysis

The insurance market has become much more competitive over the last ten years. To survive in this industry, you have to be highly proactive, creative and customer-centric. Neil was aware of this high competition and he was prepared to compete among the leading insurance companies in the US.

From marketing managers to social media managers, a strong team is required to run an insurance business successfully.

6.2 Sales Strategy

• We will introduce our business to other small and medium-sized businesses by sending them letters, brochures and our policy.
• We will advertise our business using social media platforms to reach out to millions of people.
• We will attend seminars, expos and business fares to enhance our network and customers.
• We will hire sales agents and marketing executives to carry out direct marketing of our services and products.

6.3 Sales Monthly

State Farm Business Plan – Sales Yearly

6.4 Sales Yearly

6.5 Sales Forecast

State Farm Business Plan – Unit Sales

Personnel plan

In state farm agent business plans, an important part is the personnel plan. To open state farm agency, it is crucial to plan everything before the launch. Like in every state farm business plan proposal example, the personnel plan is an important step as it affects the decisions and success of any business.

The success and reputation of any business depend mainly on the staff and management of that company. The more loyal management, the more successful the business is. The personnel plan contains detailed information about the number and types of people who will work in a company. The advice of HR experts is vital to take at this step to make important decisions.

7.1 Company Staff

Neil Fred will be the owner and CEO of Lifeline Insurance business. The following people will be needed to run our company

• 1 Legal Secretary
• 2 general insurance managers
• 1 Head of Premium Collections
• 1 Head of Claims
• 3 customer representatives
• 2 client service executives

7.2 Average Salary of Employees

Financial plan.

The next step in state farm business plan is the financial plan. Like a personnel plan, it is also a crucial step in making any business plan. Like in all state farm business plan example, the financial plan covers all the points regarding the company expenses. It also includes the cost to start a business.

• The cost required for license, permits and policies
• The cost for buying computers, furniture, printers, telephones, and fax machines
• The salary of the employees
• The cost of making a website
• The rent of the office

8.1 Important Assumptions

8.2 break-even analysis.

State Farm Business Plan – Break-even Anlysis

8.3 Projected Profit and Loss

8.3.1 profit monthly.

State Farm Business Plan – Profit Monthly

8.3.2 Profit Yearly

8.3.3 Gross Margin Monthly

State Farm Business Plan – Gross Margin Monthly

8.3.4 Gross Margin Yearly

State Farm Business Plan – Gross Margin Yearly

8.4 Projected Cash Flow

State Farm Business Plan – Project Cash Flow

8.5 Projected Balance Sheet

8.6 business ratios.

• How do you make money as a State Farm agent?

The state farm agents get the clients. They come up with innovative and unique strategies to attract new clients and are paid based on successful sales and commissions. When you know how to start a state farm agency, you can make more money from your business.

• How much do State Farm agents make per policy?

The insurance agents get a commission of 40% in their sales for the first year. From the second year, the commission on the same sales become 2 to 5 percent. The commissions are pre-defined in the state farm agency program.

• Is a State Farm agent a sole proprietor?

Yes, state farm agents work as independent contractors and they are solely responsible for making decisions regarding the management and staff employed by them. The detail is given in the state farm agent business plan.

Download State Farm Agent Business Plan Sample in pdf

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Insurance Agency Business Plan Template

Written by Dave Lavinsky

Over the past 20+ years, we have helped over 3,000 entrepreneurs and business owners create business plans to start and grow their insurance agencies. On this page, we will first give you some background information with regards to the importance of business planning. We will then go through an insurance agency business plan template step-by-step so you can create your plan today.

Download our Ultimate Insurance Business Plan Template here >

What is an Insurance Agency Business Plan?

A business plan provides a snapshot of your insurance agency as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategy for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for an Insurance Agency

If you’re looking to start an insurance agency or grow your existing insurance agency you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your insurance agency in order to improve your chances of success. Your insurance agency business plan is a living document that should be updated annually as your agency grows and changes.

Source of Funding for Insurance Agencies

With regards to funding, the main sources of funding for an insurance agency are personal savings, credit cards, bank loans, and angel investors. With regards to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to confirm that your financials are reasonable. But they will want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate the business.

The second most common form of funding for an insurance agency is angel investors. Angel investors are wealthy individuals who will write you a check. They will either take equity in return for their funding, or, like a bank, they will give you a loan. Venture capitalists will not fund an insurance agency unless it is based on a unique, scalable technology.

Finish Your Business Plan Today!

Your insurance agency business plan should include 10 sections as follows:

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your Executive Summary is to quickly engage the reader. Explain to them the type of insurance agency business you are operating and the status; for example, are you a startup, do you have an insurance agency that you would like to grow, or are you operating multiple insurance agency locations already.

Next, provide an overview of each of the subsequent sections of your plan. For example, give a brief overview of the insurance agency industry. Discuss the type of insurance agency you are operating. Detail your direct competitors. Give an overview of your target customers. Provide a snapshot of your marketing plan. Identify the key members of your team. And offer an overview of your financial plan.

Company Analysis

In your company analysis, you will detail the type of insurance agency you are operating.

For example, you might operate one of the following types:

• Direct Writer / Captive : this type of insurance agency only sells one insurance company’s products – like Allstate or State Farm
• Independent Insurance Agent : this type of insurance agency is privately-owned, and sells policies with may different insurance companies

In addition to explaining the type of insurance agency you operate, the Company Analysis section of your business plan needs to provide background on the business.

Include answers to question such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include sales goals you’ve reached, new location openings, etc.
• Your legal structure. Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry analysis, you need to provide an overview of the insurance business.

While this may seem unnecessary, it serves multiple purposes.

First, researching the insurance industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your strategy particularly if your research identifies market trends. For example, if there was a trend towards weather-related policy purchases, it would be helpful to ensure your plans call for flood insurance options.

The third reason for market research is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your insurance company business plan:

• How big is the insurance agency business (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key insurance carriers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential market for your insurance agency. You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your insurance agency business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, households, businesses, etc.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of insurance agency you operate. Clearly baby boomers would want different pricing and product options, and would respond to different marketing promotions than recent college graduates.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, include a discussion of the ages, genders, locations and income levels of the customers you seek to serve. Because most insurance agencies primarily serve customers living in their same geographic region, such demographic information is easy to find on government websites.

Psychographic profiles explain the wants and needs of your target customers. The more you can understand and define these needs, the better you will do in attracting and retaining your customers.

Finish Your Insurance Business Plan in 1 Day!

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With Growthink’s Ultimate Insurance Business Plan Template you can finish your plan in just 8 hours or less!

Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other insurance agencies.

Indirect competitors are other options that customers have to purchase from you that aren’t direct competitors. This includes self pay and public (Medicare, Medicaid in the case of health insurance) insurance or directly working with an insurance carrier. You need to mention such competition to show you understand that not everyone who purchases insurance does so through an insurance agency.

With regards to direct competition, you want to detail the other insurance agencies with which you compete. Most likely, your direct competitors will be insurance agencies located in your geographic region.

For each such competitor, provide an overview of their businesses and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as:

• What types of customers do they serve?
• What products do they offer?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you provide superior insurance agency products/services?
• Will you provide insurance agency products that your competitors don’t offer?
• Will you make it easier or faster for customers to acquire your products?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For an insurance agency business plan, your marketing plan should include the following:

Product : in the product section you should reiterate the type of insurance agency that you documented in your Company Analysis. Then, detail the specific products/services you will be offering. For example, in addition to P&C insurance, will you also offer life insurance?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your marketing plan, you are presenting the menu items you offer and their prices.

Place : Place refers to the location of your insurance agency. Document your location and mention how the location will impact your success. For example, is your insurance agency located next to the Department of Motor Vehicles, or a heavily populated office building, etc. Discuss how your location might provide a steady stream of customers.

Promotions : the final part of your insurance agency marketing plan is the promotions section. Here you will document how you will drive customers to your location(s). The following are some promotional methods you might consider:

• Making your insurance agency’s front store extra appealing to attract passing customers
• Advertising in local papers and magazines
• Reaching out to local bloggers and websites
• Partnerships with local organizations (e.g., auto dealerships or car rental stores)
• Local radio advertising
• Banner ads at local venues

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your insurance agency such as serving customers, procuring relationships with insurance carriers, negotiating with repair shops, etc.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to acquire your 500th customer, or when you hope to reach $X in sales. It could also be when you expect to hire your Xth employee or launch a new location.

Management Team

To demonstrate your insurance agency’s ability to succeed as a business, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally you and/or your team members have direct experience in the insurance agency business. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act like mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in insurance agencies and/or successfully running small businesses.

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet and cash flow statements.

Income Statement : an income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenues and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will you acquire 20 new customers per month or 50? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets : While balance sheets include much information, to simplify them to the key items you need to know about, balance sheets show your assets and liabilities. For instance, if you spend $100,000 on building out your insurance agency location and/or website, that will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a bank writes you a check for $100.000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement : Your cash flow statement will help determine how much money you need to start or grow your business, and make sure you never run out of money.

In developing your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing an insurance agency:

• Location build-out including design fees, construction, etc.
• Marketing expenses
• Website development
• Payroll or salaries paid to staff
• Business insurance
• Taxes and permits
• Legal expenses

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your store design blueprint or location lease.

Insurance Business Plan Summary

Putting together a business plan for your insurance agency is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will really understand the insurance agency business, your competition and your customers. You will have developed a marketing plan and will really understand what it takes to launch and grow a successful insurance agency.

Download Our Insurance Business Plan PDF

You can download our insurance business plan PDF here . This is a business plan template you can use in PDF format.

Insurance Business Plan FAQs

What is the easiest way to complete my insurance business plan.

Growthink's Ultimate Insurance Business Plan Template allows you to quickly and easily complete your Insurance Business Plan.

Where Can I Download an Insurance Business Plan PDF?

You can download our insurance business plan PDF template here . This is a business plan template you can use in PDF format.

Don’t you wish there was a faster, easier way to finish your Insurance business plan?

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Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.   Click here to learn about Growthink’s business plan writing services .

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State Farm business insurance

State Farm offers a variety of business insurance policies, from standard coverage like commercial auto insurance to specialized coverage like nonprofit directors and officers insurance.

State Farm may be a good choice for your business if you prefer a human touch. State Farm insurance policies are sold by a nationwide network of State Farm insurance agents. You can’t purchase a policy, or even get a quote, without talking to someone.

If you want to manage your business insurance online, though, consider other providers. State Farm business insurance customers have limited online capabilities, including viewing a list of their policies, paying their bills and contacting their agent. You’ll have to call your agent and handle things like claims-tracking over the phone.

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State Farm business insurance: Pros and cons

State farm business insurance: types of coverage.

State Farm offers the following types of business insurance , among others:

Commercial auto insurance.

General liability insurance.

Workers’ compensation .

Professional liability and errors and omissions insurance.

Commercial liability umbrella coverage.

Employment practices liability insurance.

Inland marine and mobile property insurance.

State Farm’s business owner's policy includes general liability , commercial property , business interruption and equipment breakdown coverage. Professional liability coverage can be added.

The company also offers industry-specific packages that include the components of a business owner's policy along with additional specialized coverage.

For instance:

Commercial landlord insurance includes coverage that can defray the costs of bringing buildings up to code.

HVAC contractor insurance includes coverage for equipment that moves from one location to another, plus coverage for injuries or property damage that takes place after work is done.

Painters insurance includes installation floater coverage, which protects materials before and during installation.

Notably, State Farm sells an umbrella policy that offers extra liability coverage in increments of $1 million. This makes it easy to add protection as your business grows.

State Farm also offers group life insurance and retirement planning options for business owners and their employees.

State Farm commercial auto insurance

Commercial auto insurance provides protection for the vehicles you use while doing business. State Farm’s commercial auto policies include standard coverage, including liability, personal injury and medical payments, uninsured/underinsured motorist, comprehensive and collision coverage.

State Farm offers commercial auto insurance for cars, trucks, pickup trucks, vans and farm vehicles, among others.

State Farm professional liability insurance

Unlike most business insurance providers, State Farm offers professional liability insurance as an add-on to its business owner's policy. The insurer also sells standalone professional liability coverage and includes it in many of its packages for specific industries such as barbering and cosmetology.

How to get State Farm business insurance

State Farm does not offer commercial insurance quotes online. Instead, you can fill out a quote request form with some basic information, including your name, address and what type of policy you’re looking for. A business insurance agent near you will follow up with a phone call or email.

Alternatively, you can enter your ZIP code to see a list of agents in your area and contact one directly.

State Farm agents exclusively sell State Farm insurance products and are paid on commission, which is the case for most insurance agents. As independent contractors, agents run their own agencies and hire their own employees, making them business owners themselves.

» MORE: How to get business insurance in 4 steps

State Farm customer service and claims resolution

State Farm commercial insurance customers can’t file claims online. Instead, filing a claim starts with a phone call to State Farm or to your insurance agent.

If you have to file a workers’ comp claim, State Farm offers a state-specific “claims kit,” which includes the forms you’ll need to fill out to report the injury to State Farm and to your state government.

Phone support is available, but the company encourages policyholders to contact their agents with questions.

State Farm business insurance cost

The cost of commercial insurance can vary widely depending on your industry, location, claims history and what kind of coverage you need.

State Farm does not provide information about the average cost of its commercial insurance policies. To get a sense of how much coverage will cost, you’ll need to reach out to a State Farm agent.

» MORE: Business insurance companies: How to compare options

Should you choose State Farm for business insurance?

State Farm may be a good choice for your company if:

You don't want to manage your coverage online. You'll need to work with a State Farm agent to get a quote and buy a policy, and you can only file claims over the phone.

You value customer service. State Farm ranked first for customer satisfaction in J.D. Power's 2022 U.S. Small Commercial Insurance Study, beating out competitors like Chubb, Nationwide and Allstate.

You want to get all your coverage from the same provider. State Farm agents can only sell State Farm policies, so you won't be comparing quotes from multiple insurance companies.

NerdWallet recommends getting quotes from multiple business insurance companies to find the policy that best fits your needs.

Business insurance ratings methodology

NerdWallet’s business insurance ratings reward companies that offer small-business owners reliability and ease of use. Ratings are based on weighted averages of scores in several categories, including financial strength, customer complaint data, shopping experience and customer service. Learn more about how we rate small-business insurance companies .

These ratings are a guide, but insurance policy details and prices can vary widely from business to business and provider to provider. We encourage you to shop around and compare several insurance quotes.

NerdWallet does not receive compensation for any reviews. Read our editorial guidelines .

Insurer complaints methodology

NerdWallet examined complaints received by state insurance regulators and reported to the National Association of Insurance Commissioners in 2018-2021.

To assess how insurers compare to one another, the NAIC calculates a complaint index each year for each subsidiary, measuring its share of total complaints relative to its size, or share of total premiums in the industry. To evaluate a company’s complaint history, NerdWallet calculated a similar index for each insurer, weighted by market shares of each subsidiary, over the three-year period.

Our star ratings consider ratios for both general liability insurance and commercial property insurance. When an insurer sells policies that are underwritten by several different insurance companies, we consider the NAIC complaint ratios of all the underwriters.

On a similar note...

State Farm-Dodgeville: Protecting Goals and Dreams

Chrissy Bartels doesn’t like to use the word insurance. Instead, when she describes her State Farm Insurance agency in Dodgeville, she says, “I help people have simple but deep conversations about their goals and dreams, so I can help them protect those goals and dreams against things that can go wrong.”

State Farm’s franchise-like business model attracted Chrissy. Plus, she liked their consultative approach to sales. “They focus on finding out what customers need, then offering the right insurance product. I take that jingle very personally,” Chrissy said. “Like a good neighbor, State Farm is there—and so am I.”

Chrissy opened State Farm-Dodgeville in August 2018 with a small (but growing) staff.

An opportunity to pivot

Chrissy had started a solo business in 2016, training car dealers in a sales approach using customer needs analysis. One day the phone rang: A recruiter asked if she might be interested in becoming a State Farm agent. The sales training business was turning out to be more time-consuming and less satisfying than Chrissy had expected, so she agreed to meet with the recruiter. Chrissy and her family were living in Iowa but contemplating relocating to the Dodgeville area, where they planned to retire someday. “The recruiter told me the agent in Dodgeville had passed away, leaving the territory open,” Chrissy recalled. “That fit with our plans, so I decided to apply.”

State Farm has a robust vetting program for its potential agents. First, Chrissy had to take a personality quiz to assess fit. After passing, she was invited to compete for the Dodgeville opportunity by presenting a business plan. While researching how to write a plan, Chrissy found the Small Business Development Center systems in Iowa and Wisconsin. Brock Waterman, Senior Business Consultant with the Southwest Wisconsin SBDC, immediately returned her call.

SBDC helped win competition

First, Brock provided a business plan template. Then, he coached Chrissy through revisions. “The financial projections were a huge struggle,” Chrissy admitted. “With Brock’s advice, I got it buttoned up.” Brock said, “She was more prepared than most clients. But the State Farm financial projection software had a lot of jargon in it. I was able to help her through that.” The competition for the Dodgeville State Farm agency was fierce, with the business plans a major factor. Chrissy was relieved and excited to learn she had won. Brock observed, “Chrissy moved here from Iowa to start a business. That’s true economic development.”

State Farm Insurance requires agents to make a financial investment, but does not charge them for a book of business (a list of clients and prospects). Chrissy said, “They gave me a bigger book of business than most new agents receive, and I attribute that to the work I did on my business plan with Brock.”

In Dodgeville, an interim agent had kept the business open and overseen the renovation of a new office location. Even with an existing office and client list, Chrissy faced challenges getting started on a fast timeline. She had to arrange financing: a blend of personal investment, a line of credit from a local bank, and a small loan from State Farm Insurance. She’s learned that the work itself can be hard: “People get emotional when filing claims. There’s crying,” said Chrissy. Now, she’s focusing on hiring and training employees in State Farm’s consultative approach. Chrissy emphasized, “My goal is not to maintain but to grow. We’re focusing on having strong conversations with customers about their goals.”

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State Farm Insurance Marketing Strategy: Inside State Farm Insurance’s Marketing Mastery

Kevin Urrutia

February 09, 2024

Table Of Contents

Recent Posts

State Farm Insurance, a household name in the insurance industry, has consistently remained at the pinnacle of success. Their marketing strategy, marked by innovation and customer-centricity, stands as a blueprint for businesses striving to create lasting connections with their clientele. In this article, we unravel the intricacies of State Farm Insurance’s marketing approach, exploring its key components and the tactical brilliance that underpins its success.

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State Farm Insurance Marketing Strategy: A Holistic Approach

State Farm’s marketing strategy is built on a foundation of trust, reliability, and personalized service. The company’s marketing initiatives encompass a comprehensive blend of traditional and digital techniques, allowing them to resonate with a diverse audience.

Key Components of State Farm Insurance Marketing Strategy

1. Consumer-Centric Approach

Central to State Farm’s strategy is a deep understanding of their customers. Through extensive market research and data analysis, State Farm identifies customer needs, preferences, and pain points. This insight drives product development and tailored marketing campaigns, ensuring their offerings align seamlessly with what customers seek.

We focus on direct response and customer acquisition in e-commerce, lead gen, and mobile. When it comes to results and leads, we speak your language.

2. Brand Consistency and Trust

State Farm’s iconic tagline, “Like a good neighbor, State Farm is there,” embodies their commitment to reliability. Consistent messaging across various platforms reinforces the brand’s trustworthiness. The company’s long-standing presence in communities and its reputation for swift claims processing further solidify the trust customers place in State Farm.

3. Embracing Digital Innovation

State Farm effectively utilizes digital platforms to connect with customers. Their user-friendly website and mobile app enable clients to manage policies, file claims, and access resources conveniently. This seamless digital experience enhances customer satisfaction and loyalty.

Tactics Used in State Farm Insurance Marketing Strategy

1. Emotionally Charged Advertising

State Farm’s advertisements often tug at the heartstrings, resonating with viewers on an emotional level. For instance, their long-running “Like a good neighbor” campaign features heartwarming stories that evoke empathy, leaving a lasting impression on the audience.

2. Community Engagement and Sponsorships

State Farm actively engages with local communities through sponsorships and charitable initiatives. Supporting events like neighborhood clean-ups, youth programs, and disaster relief efforts not only strengthens community ties but also enhances the brand’s image as a responsible corporate citizen.

3. Data-Driven Personalization

State Farm leverages data analytics to personalize their marketing efforts. By analyzing customer data, they tailor their communication, offers, and services to cater to individual needs. This personalized approach enhances customer satisfaction and fosters long-term relationships.

Expert Opinions and Case Studies

Marketing experts like Seth Godin praise State Farm’s approach. According to Godin, “State Farm understands that marketing is not about the stuff you make but the stories you tell. Their ability to craft compelling narratives around trust and reliability sets them apart in the insurance industry.”

A case study conducted by Nielsen revealed that State Farm’s emotionally resonant advertisements led to a significant increase in brand recall and customer loyalty, highlighting the effectiveness of their marketing tactics.

State Farm Insurance’s marketing strategy exemplifies the power of understanding customers, building trust, and embracing digital innovation. By prioritizing the needs of their clients, maintaining brand consistency, and utilizing emotionally charged storytelling, State Farm has established itself as a paragon of effective marketing in the insurance sector. Businesses seeking to emulate their success can draw inspiration from State Farm’s consumer-centric approach and strategic brilliance, forging deeper connections with their own audience and achieving sustainable growth.

Navigating the Digital Landscape: State Farm Insurance’s Triumph through Social Media, Email, and SEO Strategies

State Farm Insurance, a renowned player in the insurance industry, has mastered the art of digital marketing. In this article, we delve into State Farm Insurance’s digital strategies, dissecting their social media, email marketing, and SEO techniques. By examining these tactics, businesses can glean invaluable insights to enhance their own online presence and engagement.

State Farm Insurance’s Social Media Strategy: Building Communities and Trust

State Farm’s social media strategy centers around building meaningful connections and fostering trust. The company utilizes platforms like Facebook, Twitter, Instagram, and LinkedIn to engage with customers effectively. Through a combination of informative content, customer testimonials, and interactive campaigns, State Farm creates a sense of community, strengthening its brand image.

Example: State Farm’s Facebook page features informative posts about insurance tips, community events, and safety advice, engaging followers and positioning the brand as a reliable source of information.

State Farm Insurance’s Email Marketing Strategy: Personalization and Engagement

State Farm’s email marketing strategy focuses on personalization and engagement. By analyzing customer data, they tailor their email campaigns to deliver relevant content, including policy updates, safety tips, and promotional offers. The use of personalized subject lines and targeted content ensures high open rates and customer engagement.

Example: State Farm sends personalized emails to customers on their policy anniversaries, expressing gratitude for their loyalty and offering exclusive discounts on additional coverage, enhancing customer retention.

State Farm Insurance’s SEO Strategy: Dominating Search Results

State Farm’s SEO strategy is designed to dominate search engine results pages (SERPs). Through extensive keyword research, on-page optimization, and high-quality backlinks, State Farm ensures its website ranks prominently for relevant search queries. User-friendly website design and mobile responsiveness further contribute to a seamless user experience, boosting organic traffic.

Example: State Farm’s website features a blog section with articles about insurance-related topics, optimizing for long-tail keywords like “how to choose the right insurance coverage,” attracting organic traffic and establishing authority in the insurance niche.

Digital marketing experts, such as Neil Patel, commend State Farm’s digital strategies. Patel emphasizes, “State Farm’s success lies in their ability to combine personalized content with community engagement. Their email marketing and social media efforts create a cohesive digital ecosystem that resonates with their audience.”

A case study by SEMrush highlights State Farm’s dominance in search engine rankings, citing their consistent presence in the top positions for insurance-related keywords, showcasing the effectiveness of their SEO strategy.

State Farm Insurance’s digital strategies exemplify the power of personalization, engagement, and strategic optimization. By focusing on building communities, tailoring content to individual needs, and dominating search engine results, State Farm has established itself as a leader in the digital landscape. Businesses aspiring to replicate their success can draw inspiration from State Farm’s approach, creating a strong online presence, fostering customer relationships, and ultimately, driving growth in the competitive digital world.

Mastering the Art of Sales: Decoding State Farm Insurance’s Selling Strategy

State Farm Insurance, a stalwart in the insurance industry, has perfected the art of selling, establishing trust, and building long-term relationships with its customers. In this article, we unravel the intricacies of State Farm’s selling strategy, dissect the tactics employed, provide actionable insights for businesses, and delve into the specific target market that State Farm effectively caters to.

State Farm Insurance’s Selling Strategy: A Customer-Centric Approach

State Farm’s selling strategy is underpinned by a customer-centric philosophy. The company prioritizes understanding the unique needs and concerns of its clients. By employing empathetic agents, employing clear communication, and offering personalized solutions, State Farm creates an environment where customers feel valued and understood, fostering a sense of trust and loyalty.

Example: State Farm agents undergo extensive training to understand customer pain points. They often use tools like customer relationship management (CRM) software to track customer interactions, ensuring personalized service at every touchpoint.

How to Apply These Tactics for Your Business: Practical Applications

• Embrace Empathy and Active Listening: Train your sales team to empathize with customers’ needs and actively listen to their concerns. Demonstrating genuine understanding creates a connection that can turn a potential customer into a loyal client.
• Transparency and Clear Communication: Be transparent about your products or services. Clearly articulate what you offer, the benefits, and any limitations. Avoid jargon and ensure your customers fully understand what they are purchasing.
• Personalized Solutions: Utilize customer data to tailor your offerings. Implementing CRM systems can help you track customer preferences and behaviors, allowing you to provide personalized solutions that resonate with individual needs.
• Trust and Reliability: Build your brand as one that customers can trust. Encourage customer reviews and testimonials, showcasing positive experiences. Trust is a cornerstone of successful selling.

What is the Target Market for State Farm Insurance?

State Farm’s target market is broad and inclusive. The company caters to individuals and families across various demographics. However, State Farm strategically focuses on the following segments:

• Homeowners and Renters: State Farm offers comprehensive home insurance, making it an ideal choice for homeowners and renters alike. Their policies cover property damage, liability, and personal belongings, appealing to those seeking protection for their homes and valuables.
• Automobile Owners: State Farm is renowned for its auto insurance policies. Their coverage options, competitive rates, and emphasis on customer service make them a preferred choice for car owners.
• Small Business Owners: State Farm provides insurance solutions tailored to small businesses, covering commercial property, liability, and workers’ compensation. Their specialized policies cater to the unique needs of entrepreneurs and business owners.

Expert Opinions and Studies

Marketing expert, Jay Baer, emphasizes the importance of empathy in selling: “Empathy is the heart of effective selling. It’s not about pushing products; it’s about understanding your customers’ needs and demonstrating how your product or service fulfills those needs.”

A study by Accenture revealed that 73% of customers are more likely to make a purchase if they receive a personalized experience. This underscores the importance of tailoring your sales approach to individual customer preferences.

State Farm Insurance’s selling strategy serves as a beacon for businesses aiming to establish trust, build lasting customer relationships, and drive sales. By adopting a customer-centric approach, emphasizing empathy, providing personalized solutions, and prioritizing transparency, businesses can emulate State Farm’s success. Understanding your target market and tailoring your offerings accordingly further strengthens your position in the competitive landscape. By applying these principles, businesses can create a positive and impactful selling experience, ensuring customer satisfaction and loyalty in the long run.

Unveiling the Secrets: State Farm Insurance’s Marketing Mastery

State Farm Insurance, a household name in the insurance industry, has long been admired for its innovative marketing strategies. In this article, we explore the intricacies of State Farm’s marketing approach, dissecting their budget, innovations, and best practices. By understanding these key elements, businesses can glean valuable insights to enhance their own marketing strategies and foster growth.

How much does State Farm Insurance spend on marketing?

State Farm Insurance allocates a substantial budget to its marketing efforts. While specific figures may not be publicly disclosed, it’s evident that the company invests significantly in advertising, digital marketing, sponsorships, and community engagement. This substantial investment underscores State Farm’s commitment to building and sustaining its brand presence in the competitive insurance market.

Expert Opinion: According to marketing analytics firm Statista, State Farm spent over 900 million U.S. dollars on advertising in 2020, emphasizing the company’s dedication to maintaining a robust marketing presence.

What was so innovative about State Farm Insurance?

State Farm’s innovation lies not only in its products but also in its marketing strategies. One of the standout innovations was the launch of the “Discount Double Check” campaign. This campaign, featuring Green Bay Packers quarterback Aaron Rodgers, creatively communicated the message of saving money on insurance. The campaign not only garnered attention but also increased brand visibility significantly.

Additionally, State Farm has embraced digital innovation, creating user-friendly mobile apps that enable customers to manage policies, file claims, and access resources conveniently. This seamless digital experience enhances customer satisfaction and sets State Farm apart in the insurance industry.

Example: State Farm’s Pocket Agent app provides customers with instant access to insurance information, allowing them to file claims, request roadside assistance, and even access virtual insurance cards, simplifying the customer experience.

Best Practices for Applying State Farm Insurance Marketing Strategy to Your Business

• Focus on Customer Needs: Understand your customers’ pain points and needs. Tailor your products or services to address these specific concerns, just as State Farm customizes insurance solutions to meet individual requirements.
• Embrace Creativity: Think outside the box and develop innovative marketing campaigns that resonate with your audience. Engage with consumers emotionally, creating memorable experiences that leave a lasting impression.
• Invest in Digital Presence: Develop user-friendly websites and mobile apps. Embrace social media platforms, email marketing, and search engine optimization to expand your digital footprint and engage with a broader audience.
• Community Engagement: Actively participate in community events and initiatives. Sponsorships, charitable contributions, and local partnerships enhance brand visibility and foster a positive brand image, just as State Farm engages with local communities.

State Farm Insurance’s marketing success is a result of its innovative approach, substantial investment, and unwavering commitment to customer satisfaction. By adopting a customer-focused mindset, embracing creativity, investing in digital presence, and engaging with the community, businesses can apply State Farm’s marketing strategies effectively.

In an ever-evolving digital landscape, understanding these best practices and incorporating them into your marketing endeavors can lead to increased brand recognition, customer loyalty, and sustained growth. By learning from State Farm’s innovative strategies, businesses can pave the way for a successful and impactful marketing journey.

Demystifying State Farm Insurance’s Marketing Strategy: Frequently Asked Questions (FAQ)

State Farm Insurance, one of the giants in the insurance industry, has consistently impressed the market with its effective marketing strategies. In this article, we address some of the most frequently asked questions about State Farm’s marketing strategy, providing detailed answers to offer insights into the company’s innovative approach and success in the competitive insurance sector.

1. What is the Core Philosophy Behind State Farm Insurance’s Marketing Strategy?

Answer: At the heart of State Farm Insurance’s marketing strategy lies a customer-centric approach. The company believes in understanding its customers deeply, addressing their needs, and building relationships based on trust and reliability. Their marketing efforts focus on empathetic communication, personalized solutions, and creating an emotional connection with the customers.

2. How Does State Farm Insurance Leverage Digital Platforms in Its Marketing Strategy?

Answer: State Farm Insurance embraces digital platforms comprehensively. Their website and mobile apps offer user-friendly interfaces for customers to access policy information, file claims, and seek assistance. They utilize social media channels, email marketing, and search engine optimization to engage with a wider audience. The company’s active presence on platforms like Facebook, Twitter, and Instagram allows them to share informative content and engage with customers directly.

3. What Role Does Community Engagement Play in State Farm Insurance’s Marketing Strategy?

Answer: Community engagement is a significant aspect of State Farm Insurance’s marketing strategy. The company actively participates in local events, sponsors community initiatives, and supports charitable causes. By integrating into local communities, State Farm not only strengthens its brand presence but also builds a positive image as a responsible corporate citizen.

4. How Does State Farm Insurance Foster Customer Loyalty and Retention?

Answer: State Farm fosters customer loyalty through exceptional customer service and personalized offerings. Their agents are trained to provide valuable assistance, ensuring customers have a positive experience. State Farm also offers loyalty programs and discounts to long-term customers, encouraging retention. Additionally, the company maintains an active presence on social media, allowing customers to engage and interact, strengthening their loyalty.

5. What Impact Has State Farm Insurance’s Marketing Strategy Had on Its Market Position?

Answer: State Farm Insurance’s effective marketing strategy has played a pivotal role in consolidating its position as one of the leading insurance providers. Their customer-centric approach, coupled with innovative digital marketing and community engagement, has created a strong brand identity. According to market research data, State Farm consistently ranks high in customer satisfaction surveys, showcasing the positive impact of their marketing efforts on their market position.

State Farm Insurance’s marketing strategy serves as an exemplary model for businesses aiming to build customer trust, enhance brand visibility, and foster long-term relationships. By understanding the core philosophies, digital integration, community engagement, customer retention strategies, and market positioning techniques employed by State Farm, businesses can glean invaluable insights to elevate their own marketing efforts. Embracing these strategies can lead to enhanced customer satisfaction, increased brand loyalty, and sustainable growth in today’s competitive market landscape.

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State Farm: Business Model, SWOT Analysis, and Competitors 2023

Inside This Article

State Farm is a well-established insurance company that has been serving customers for decades. This blog article will provide a comprehensive analysis of State Farm's business model, including its strengths, weaknesses, opportunities, and threats (SWOT analysis). Additionally, we will delve into the company's competitors in the insurance industry and explore the market trends expected in 2023. By understanding State Farm's approach to business and the competitive landscape it operates in, readers will gain valuable insights into this influential player in the insurance sector.

What You Will Learn:

• Who owns State Farm and how its ownership structure impacts its operations and decision-making processes.
• The mission statement of State Farm and how it guides the company's strategic goals and objectives.
• How State Farm makes money through its various revenue streams and business practices, including its insurance policies and financial services.
• An explanation of the State Farm Business Model Canvas, exploring the key components and value propositions that drive the company's success.
• An overview of State Farm's competitors in the insurance industry and how they compare in terms of market share, offerings, and customer base.
• A comprehensive SWOT analysis of State Farm, highlighting its strengths, weaknesses, opportunities, and threats, and how these factors shape its competitive position in the market.

Who owns State Farm?

Introduction.

State Farm is a well-known insurance company in the United States, providing a wide range of insurance products and financial services to millions of customers. However, understanding the ownership structure of State Farm can provide valuable insight into the company's operations and decision-making processes. In this section, we will delve into the question of who owns State Farm and explore the key stakeholders involved.

State Farm Mutual Automobile Insurance Company

State Farm Mutual Automobile Insurance Company is the primary entity that owns State Farm. It is a mutual insurance company, which means it is owned by its policyholders rather than external shareholders. This unique ownership structure sets State Farm apart from many other insurance companies that are publicly traded and have shareholders who expect returns on their investments. As a mutual company, State Farm operates with the goal of providing the best possible services to its policyholders and returning any profits to them in the form of dividends or lower premiums.

Policyholders

As mentioned earlier, the policyholders are the owners of State Farm Mutual Automobile Insurance Company. When individuals purchase insurance policies from State Farm, they become policyholders and, in turn, shareholders of the company. This ownership structure gives policyholders certain rights and privileges, such as the ability to vote on matters that affect the company's operations and board of directors.

With millions of policyholders across the United States, State Farm's ownership is widely distributed among individuals who rely on the company for their insurance needs. These policyholders play a significant role in shaping the company's direction and values, as they have a direct stake in its success and financial well-being.

Board of Directors

State Farm is governed by a board of directors, which is responsible for overseeing the company's strategic decisions and ensuring that it operates in the best interests of its policyholders. The board consists of individuals who are elected by the policyholders and have extensive expertise in various fields, including insurance, finance, and business management.

The board of directors acts as a fiduciary for the policyholders, making decisions that align with the company's mission and values while safeguarding the interests of the policyholders. They work closely with State Farm's management team to set policies, monitor performance, and guide the company's long-term vision.

In conclusion, State Farm Mutual Automobile Insurance Company is owned by its policyholders, making it a mutual insurance company. This ownership structure reflects State Farm's commitment to prioritizing the needs and interests of its policyholders above external shareholders. The policyholders, as owners, have the power to influence the company's direction through voting and electing the board of directors. This unique ownership model ensures that State Farm remains focused on providing the best possible service and value to its policyholders, setting it apart from other insurance companies.

What is the mission statement of State Farm?

State farm's mission statement.

State Farm, one of the largest insurance and financial services providers in the United States, has a clear and concise mission statement that guides its operations and decision-making processes. The company's mission statement reads:

"To help people manage the risks of everyday life, recover from the unexpected, and realize their dreams."

This simple yet powerful statement encapsulates State Farm's commitment to its customers and the community it serves. It reflects their dedication to providing reliable insurance coverage and financial solutions that support individuals, families, and businesses in navigating life's uncertainties.

Customer-Centric Approach

State Farm's mission statement emphasizes its customer-centric approach. By focusing on helping people manage risks, State Farm recognizes that individuals face various challenges and uncertainties in their daily lives. Through their range of insurance products and services, State Farm aims to provide customers with the peace of mind they need to navigate these risks confidently.

Furthermore, the mission statement highlights State Farm's dedication to assisting customers in recovering from unexpected events. Whether it is a car accident, a natural disaster, or a health emergency, State Farm strives to be there for its customers during difficult times. By offering comprehensive insurance coverage and exceptional customer service, the company aims to support individuals and families in their recovery process.

Empowering Dreams

State Farm's mission statement also emphasizes its commitment to helping customers realize their dreams. This aspect of the mission statement signifies the company's understanding that insurance and financial services go beyond mere protection. State Farm aims to empower individuals by providing them with the necessary tools and resources to achieve their long-term goals and aspirations.

Whether it is buying a new home, starting a business, or planning for retirement, State Farm offers a range of financial solutions to help customers turn their dreams into reality. By providing personalized advice, financial planning services, and reliable insurance coverage, State Farm supports customers in making informed decisions and taking steps towards their desired future.

State Farm's mission statement, "To help people manage the risks of everyday life, recover from the unexpected, and realize their dreams," clearly outlines the company's dedication to its customers and their well-being. By focusing on customer-centricity, State Farm aims to provide reliable insurance coverage, exceptional service, and financial solutions that empower individuals, families, and businesses. Through their unwavering commitment to their mission, State Farm continues to be a trusted and reliable partner for millions of customers across the United States.

How does State Farm make money?

Insurance premiums.

One of the primary ways State Farm makes money is through collecting insurance premiums from its policyholders. When individuals or businesses purchase insurance policies, they agree to pay a certain amount, known as a premium, on a regular basis. This premium is based on various factors such as the type of coverage, the insured's risk profile, and the value of the insured property.

State Farm offers a wide range of insurance products, including auto, home, renters, life, health, and business insurance. Each policyholder pays a premium specific to their coverage type, and these premiums collectively form a significant portion of State Farm's revenue stream.

The premium amounts are determined based on actuarial calculations, which consider historical data, risk assessments, and other factors. State Farm sets its premiums to ensure that it covers the potential claims and operating expenses while also making a profit.

Investment income

Another significant source of revenue for State Farm is its investment income. As a large insurance company, State Farm possesses substantial financial resources. It invests these funds in various asset classes, such as stocks, bonds, real estate, and other financial instruments.

The returns generated from these investments contribute to State Farm's overall profitability. By strategically managing their investment portfolio, State Farm aims to generate a steady stream of income from dividends, interest payments, and capital gains.

The investment income serves as a supplement to the insurance premiums. It helps to offset the costs associated with paying out claims, maintaining infrastructure, and covering other operational expenses. Additionally, it allows State Farm to accumulate reserves and strengthen its financial position.

Banking services

State Farm offers a range of banking services, including checking accounts, savings accounts, credit cards, loans, and mortgages. Through these financial services, State Farm generates revenue in the form of interest and fees.

When customers open accounts or borrow money from State Farm Bank, they pay interest on their deposits or loans. State Farm Bank also charges various fees, such as overdraft fees, ATM fees, and late payment fees. These fees contribute to State Farm's revenue stream and help cover the costs of providing banking services.

While banking services may not be the primary source of income for State Farm, they are an important component of its overall business model. By diversifying its offerings to include banking services, State Farm can attract new customers and provide a more comprehensive range of financial solutions.

State Farm Business Model Canvas Explained

Introduction to the business model canvas.

The Business Model Canvas is a strategic management tool that allows organizations to visually represent and analyze their business model. It provides a clear and concise overview of the key elements that make up a business, enabling stakeholders to understand how different components interact and contribute to the overall value proposition.

Key Components of the State Farm Business Model Canvas

State Farm, the largest property and casualty insurance provider in the United States, utilizes the Business Model Canvas to outline its key activities, resources, and relationships. Let's explore some of the essential components that form the foundation of the State Farm Business Model Canvas.

Customer Segments

State Farm targets a diverse range of customer segments. These include individual homeowners and renters, businesses, and automobile owners. By understanding the unique needs and preferences of each segment, State Farm is able to tailor its products and services to provide the best possible solutions.

Value Proposition

State Farm's value proposition centers around providing reliable insurance coverage, exceptional customer service, and a sense of security to its customers. By offering a wide range of insurance products such as home, auto, life, and health insurance, State Farm aims to meet the varying needs of its customers and ensure their peace of mind.

State Farm employs various channels to reach its customers effectively. These channels include a vast network of independent insurance agents, online platforms, mobile applications, and customer service centers. By offering multiple touchpoints, State Farm ensures that customers can interact with the company in a way that suits their preferences and convenience.

Customer Relationships

Building strong and lasting customer relationships is crucial for State Farm. The company takes a customer-centric approach by providing personalized support, handling claims efficiently, and offering assistance throughout the insurance process. By fostering trust and reliability, State Farm aims to create loyal customers who will choose their services over competitors.

Revenue Streams

State Farm generates revenue primarily through insurance premiums paid by its customers. Additional revenue streams include investment income from the company's financial assets and fees charged for certain services. By diversifying its revenue streams, State Farm ensures a sustainable financial position and the ability to provide quality services to its customers.

Key Activities and Resources

The key activities of State Farm include underwriting insurance policies, managing claims, customer acquisition and retention, risk assessment, and investment management. To support these activities, State Farm relies on a wide range of resources such as a skilled workforce, technology infrastructure, customer data, partnerships with insurance providers, and financial assets.

By utilizing the Business Model Canvas, State Farm gains a comprehensive understanding of its business model, enabling the company to identify areas for improvement, refine its operations, and stay competitive in the insurance industry. The Canvas acts as a visual roadmap that guides State Farm's strategic decision-making, ensuring the company continues to meet the evolving needs of its customers while maintaining a strong and sustainable business.

Which companies are the competitors of State Farm?

State Farm is one of the leading insurance companies in the United States, offering a wide range of insurance and financial products. However, it faces tough competition from several other insurance companies that operate in similar markets. In this section, we will discuss some of State Farm's main competitors and how they compare in terms of market share, product offerings, and customer satisfaction.

One of State Farm's biggest competitors is Allstate, a well-known insurance company that provides auto, home, and life insurance, as well as various financial products. Allstate is widely recognized for its catchy slogan "You're in good hands" and is known for its extensive network of agents, similar to State Farm. Both companies offer similar insurance products and compete for customers in various markets.

In terms of market share, State Farm and Allstate are often neck and neck. According to the latest reports, State Farm holds the largest market share in the auto insurance industry, closely followed by Allstate. This intense competition has led both companies to constantly innovate and improve their products and services to attract and retain customers.

Another major competitor of State Farm is Geico, an insurance company known for its humorous advertisements and competitive pricing. Geico primarily focuses on auto insurance but also offers other insurance products such as home, renters, and motorcycle insurance. Unlike State Farm and Allstate, Geico primarily operates online and over the phone, with a limited number of physical agent locations.

Geico has gained popularity over the years, thanks to its aggressive marketing campaigns and competitive pricing strategies. It has managed to capture a significant market share, especially among younger customers who prefer the convenience of online shopping and cheaper premiums. While State Farm and Geico compete in the auto insurance market, State Farm's extensive agent network gives it an advantage in reaching customers who prefer a more personal touch.

Progressive

Progressive is yet another formidable competitor in the insurance industry, known for its innovative approach and unique advertising campaigns. Like State Farm, Progressive offers a wide range of insurance products, including auto, home, renters, and even specialty insurance like boat and RV coverage. Progressive is known for its "Name Your Price" tool, which allows customers to customize their coverage based on their budget.

In terms of market share, Progressive has been steadily gaining ground in recent years, especially in the auto insurance sector. While State Farm still holds a larger market share, Progressive's focus on technology-driven solutions and user-friendly interfaces have attracted a younger demographic. Like Geico, Progressive primarily operates online and over the phone, but it also has a network of independent agents.

State Farm faces strong competition from several insurance companies in the market, including Allstate, Geico, and Progressive. Each of these competitors brings unique strengths and strategies to the table, whether it's Allstate's extensive agent network, Geico's online convenience and competitive pricing, or Progressive's focus on innovative technology. Despite the competition, State Farm continues to maintain its position as one of the leading insurance providers in the country, driven by its commitment to customer service, comprehensive coverage options, and a vast network of agents.

State Farm SWOT Analysis

• Established brand: State Farm is one of the most recognized insurance companies in the United States, with a long-standing history and a strong reputation for reliability and customer service.
• Extensive product offerings: State Farm offers a wide range of insurance products, including auto, home, life, health, and business insurance, catering to the diverse needs of its customers.
• Large network of agents: With a vast network of more than 19,000 agents nationwide, State Farm has a significant advantage in providing personalized customer service and building strong customer relationships.
• Financial stability: State Farm boasts a strong financial position, with substantial assets and a high credit rating, assuring customers that their claims will be paid promptly and efficiently.
• Technological innovation: State Farm has invested significantly in technology, offering a user-friendly website, mobile app, and online tools that make it easy for customers to access their policies, file claims, and receive assistance.
• Limited international presence: While State Farm is a dominant player in the US insurance market, it has a limited presence in international markets, which restricts its growth opportunities and exposes it to potential economic fluctuations in the US.
• Higher premiums: Compared to some competitors, State Farm's premiums tend to be higher, which may make it less attractive to price-sensitive customers seeking more affordable insurance options.
• Limited specialty insurance offerings: State Farm primarily focuses on mainstream insurance products, and its range of specialty insurance offerings, such as pet insurance or travel insurance, is relatively limited. This may result in missed opportunities to capture niche markets.

Opportunities

• Growing demand for digital insurance: With the increasing adoption of digital channels for insurance purchases and claims processing, State Farm can capitalize on this trend by further enhancing its online and mobile capabilities, providing customers with a seamless digital experience.
• Expansion into new markets: State Farm can explore opportunities to expand its international footprint, tapping into emerging markets where insurance penetration rates are relatively low, thus offering significant growth potential.
• Diversification of product portfolio: By expanding its range of specialty insurance offerings to include niche markets, such as cyber insurance or rideshare insurance, State Farm can attract new customers and increase market share.
• Intense competition: The insurance industry is highly competitive, with numerous well-established players and emerging insurtech companies vying for market share. This poses a threat to State Farm's market position and profitability.
• Regulatory challenges: Evolving regulatory requirements and changes in legislation can impact State Farm's operations and increase compliance costs, potentially affecting its profitability.
• Disruptive technology: Advancements in technology, such as the rise of autonomous vehicles or the increasing use of artificial intelligence in claims processing, pose both opportunities and threats. State Farm must adapt and embrace these technological changes to stay competitive in the market.

Key Takeaways

State Farm is a mutual company, meaning it is owned by its policyholders rather than shareholders.

The mission statement of State Farm is to help people manage the risks of everyday life, recover from the unexpected, and realize their dreams.

State Farm primarily makes money through selling insurance policies, including auto, home, and life insurance, as well as offering financial services such as banking and mutual funds.

The Business Model Canvas is a tool that helps analyze and understand how State Farm operates and creates value for its customers. It includes key aspects such as customer segments, value propositions, channels, customer relationships, revenue streams, key resources, key activities, key partnerships, and cost structure.

Some of the main competitors of State Farm in the insurance industry include Allstate, Geico, Progressive, and Farmers Insurance.

In terms of SWOT analysis, State Farm's strengths include its strong brand reputation, extensive agent network, and diverse range of insurance products. Its weaknesses may include potential customer dissatisfaction due to the company's size and bureaucracy. Opportunities for State Farm include expanding into new markets and leveraging technology advancements, while threats include increasing competition and potential regulatory changes.

In conclusion, State Farm is one of the largest insurance companies in the United States, providing a wide range of insurance products and financial services. As a mutual company, State Farm is owned by its policyholders, which sets it apart from other insurance companies that are publicly traded.

The mission statement of State Farm is to help people manage the risks of everyday life, recover from the unexpected, and realize their dreams. This mission drives their commitment to providing quality insurance coverage and exceptional customer service to their policyholders.

State Farm primarily makes money through the premiums paid by their policyholders. This revenue is then invested to generate additional income. The company also offers various financial products and services, such as banking and mutual funds, which contribute to their overall revenue.

The State Farm Business Model Canvas provides a comprehensive overview of how the company creates, delivers, and captures value. It highlights key elements such as customer segments, value proposition, channels, customer relationships, revenue streams, key resources, key activities, key partners, and cost structure. Understanding this canvas enables us to see the various aspects of State Farm's business model and how they operate in the insurance industry.

State Farm faces fierce competition from other major insurance companies, including Allstate, Geico, and Progressive. These companies also offer a range of insurance products and services and compete for the same customer base. However, State Farm differentiates itself through its strong brand reputation, personalized service, and extensive agent network.

Conducting a SWOT analysis of State Farm reveals its strengths, weaknesses, opportunities, and threats. Some of its strengths include a well-established brand, a wide range of insurance products, and a large customer base. However, weaknesses such as high premium rates and limited digital presence can pose challenges. Opportunities for State Farm lie in expanding its international presence and leveraging emerging technologies. Meanwhile, threats include increasing competition, regulatory changes, and economic uncertainties.

Overall, State Farm's ownership structure, mission statement, revenue sources, business model, competitors, and SWOT analysis all contribute to its position as a prominent player in the insurance industry. With a commitment to customer satisfaction and a strong market presence, State Farm continues to serve millions of policyholders and navigate the evolving landscape of insurance.

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Switching State Farm Agents: The Ultimate Guide to Changing Your Insurance Provider

Table of Contents

Looking to change your State Farm agent? It’s easy! Follow these simple steps to switch to a new agent and get the support you need.

Are you looking to change your State Farm agent? Perhaps you’ve moved to a new area or you’re dissatisfied with your current agent’s services. Whatever the reason may be, switching agents can seem like a daunting task. However, it doesn’t have to be a complicated process. With a little preparation and research, you can find a new State Farm agent who meets your needs and exceeds your expectations. So, let’s dive into the steps you should take to change your State Farm agent smoothly and efficiently.

Changing your State Farm agent can be a daunting task, but it doesn’t have to be. Whether you’re looking for better customer service or just want to switch things up, switching agents is easier than you might think. Here are some simple steps to help you change your State Farm agent:

Step 1: Evaluate your current agent

The first step in changing your State Farm agent is to evaluate your current agent. Take some time to think about why you want to switch agents. Is it because you’re unhappy with their customer service? Did they make a mistake on your policy? Or are you just looking for a change? Whatever the reason, it’s important to have a clear understanding of why you want to switch agents before you start the process.

Step 2: Contact your new agent

Once you’ve decided to change agents, the next step is to contact your new agent. You can find a new State Farm agent by searching online or by asking for recommendations from friends and family. Once you’ve found an agent you like, give them a call or send them an email to set up a meeting. During this meeting, you can discuss your insurance needs and ask any questions you may have.

Step 3: Notify your current agent

Once you’ve found a new agent, it’s important to notify your current agent that you’ll be switching. You can do this by sending them an email or giving them a call. Make sure to let them know why you’re switching and when you plan on making the switch. Your current agent can help you with any paperwork or documentation needed to make the switch.

Step 4: Complete any necessary paperwork

Depending on your state and policy, there may be some paperwork required to make the switch. Your new agent can help you with any necessary paperwork and documentation. Make sure to read through any documents carefully before signing them to ensure that you understand everything.

Step 5: Cancel your current policy

Before you can start your new policy with your new agent, you’ll need to cancel your current policy with your old agent. This can usually be done over the phone or through an online portal. Make sure to cancel your policy on the effective date of your new policy to avoid any lapses in coverage.

Step 6: Start your new policy

Once you’ve canceled your old policy, you can start your new policy with your new agent. Make sure to read through your new policy carefully to ensure that you understand everything. If you have any questions or concerns, don’t hesitate to reach out to your new agent for help.

Step 7: Follow up with your new agent

After you’ve switched agents, it’s important to follow up with your new agent to make sure everything is going smoothly. If you have any issues or concerns with your new policy, your agent can help you address them. Make sure to keep in touch with your agent and let them know if your insurance needs change.

Step 8: Leave a review

Finally, once you’ve gone through the process of switching agents, consider leaving a review for both your old and new agents. This can help other customers make informed decisions about choosing an agent and can also provide valuable feedback for the agents themselves.

Switching State Farm agents doesn’t have to be a difficult process. By following these simple steps, you can make the switch smoothly and efficiently. Remember to communicate openly with your agents and take the time to understand your policies. With the right agent, you can have peace of mind knowing that your insurance needs are taken care of.

Changing State Farm agents can be a daunting task, but it’s important to evaluate your relationship with your current agent before making any decisions. Take a moment to reflect on the level of service and communication you’re receiving from your current agent. If it’s not meeting your expectations, it may be time to consider a switch. Before changing agents, it’s essential to know your policy details. Get familiar with your coverage limit, deductibles, and premium payments. This will help ensure that there are no surprises during the transition process. Research is key when looking for a new agent. Look for agents in your area and read reviews to get a better insight into their customer service and relationships with clients. Once you have narrowed down your options, inform your current agent that you would like to make a change so that they can provide any assistance necessary in the transition and potential refunds or adjustments on your policy.Before making a commitment to a new agent, discuss your needs with them to ensure they have the necessary resources and experience to deliver on promises. Choose an agent that has a history of delivering premium services while establishing a relationship based on trust. This will help ensure that you receive the quality service you deserve.Once you have selected a new agent, you can request a transfer by transferring your policy and relevant information to the new agent. It’s important to notify your current agent that you are no longer working with them to avoid confusion and complications.Follow up with your new agent to ensure that your policy details are accurate and your coverage is active and comprehensive. After the transfer, review your policy details to ensure accuracy and that all of your needs are being met.Note: Always check with the State Farm agent about their procedures and policies regarding changing their associated agent. They may have specific steps or requirements that need to be followed. By following these steps and using careful consideration, changing State Farm agents can be a smooth and stress-free process.

Changing your State Farm agent may seem like a daunting task, but it can actually be quite simple. Here’s a story telling about how to change your State Farm agent from the perspective of someone who has recently gone through the process:

My Experience Changing State Farm Agents

For years, I had been with the same State Farm agent. They were friendly and helpful, but I started to notice that my rates were creeping up over time. I decided to look into changing agents to see if I could find a better deal. Here’s what I did:

• Research new agents in your area: I started by doing some online research to find State Farm agents in my local area. I read reviews and looked at their websites to get an idea of what their services were like.
• Make a list of questions: Once I found a few agents that I thought might be a good fit, I made a list of questions to ask them. These questions included things like their experience, their rates, and what kind of coverage they offered.
• Set up a meeting: I contacted the agents on my list and set up meetings with each of them. This gave me a chance to ask my questions and get a feel for their personality and communication style.
• Choose your new agent: After meeting with several agents, I ultimately chose one who I felt was the best fit for me. They were knowledgeable, friendly, and offered competitive rates.
• Notify your old agent: Once I had made my decision, I contacted my old State Farm agent to let them know that I would be switching to a different agent. They were understanding and helped me through the process of cancelling my policy with them.
• Transfer your policy: Finally, I worked with my new State Farm agent to transfer my policy over to them. This involved providing them with some basic information about my current policy and signing some paperwork.

Overall, changing my State Farm agent was a relatively painless process. By doing my research and asking the right questions, I was able to find an agent who better suited my needs and helped me save money on my insurance rates.

Well, folks, that’s all for now! I hope this guide on how to change your State Farm agent has been helpful in answering any questions or concerns you may have had. Remember, as a policyholder, it is your right to choose the agent who best serves your needs and provides the level of service you want and deserve.

If you’ve decided to make the switch to a new State Farm agent, don’t be afraid to ask questions. Reach out to potential agents and schedule meetings to discuss their experience, qualifications, and services. Don’t forget to research their customer feedback and reviews to ensure they have a track record of delivering excellent service and satisfaction.

Changing your State Farm agent can be a daunting process, but it doesn’t have to be. With a little bit of research, communication, and effort, you can find the perfect agent to meet your insurance needs. Remember, your agent is your advocate and partner in protecting what matters most to you, so choose wisely.

Thank you for visiting our blog today. We hope you found this article informative and useful. If you have any further questions or comments, please don’t hesitate to reach out to us. We’re always here to help!

People often have questions about how to change their State Farm agent. Here are some of the most frequently asked questions:

• How do I change my State Farm agent?

To change your State Farm agent, you can call your current agent and request a transfer to another agent. You can also contact State Farm customer service and ask for assistance in finding a new agent.

• Can I change my State Farm agent without changing my policy?

Yes, you can change your State Farm agent without changing your policy. Your new agent will work with you to ensure that your policy remains the same.

• What happens to my policy if I change my State Farm agent?

Your policy will remain in effect if you change your State Farm agent. Your new agent will have access to your policy information and will be able to provide you with the same level of service as your previous agent.

• Will I lose any discounts or benefits if I change my State Farm agent?

No, you will not lose any discounts or benefits if you change your State Farm agent. Your new agent will be able to provide you with the same level of discounts and benefits as your previous agent.

• What should I do if I am unhappy with my State Farm agent?

If you are unhappy with your State Farm agent, you can request a transfer to another agent or contact State Farm customer service to voice your concerns. You can also consider switching to another insurance company if you feel that State Farm is not meeting your needs.

Changing your State Farm agent is a simple process that can be done by contacting your current agent or State Farm customer service. If you have any questions or concerns about changing your agent, don’t hesitate to reach out for assistance.

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BE A STATE FARM ® AGENT

Run a business.

Make a difference..

Make a positive impact on your neighborhood. Being a State Farm independent contractor agent gives you the unique opportunity to develop yourself, your business and your community. Grow your career while working for something you believe in.

Be an entrepreneur

Embark on an entrepreneurial journey unlike any other. Run your own business and be there for your community when it matters most.

Being an independent contractor agent means that you operate your own business and are responsible for acquiring new customers, building your own team, and growing your business. This unique entrepreneurial opportunity offers rewarding career growth while making a positive impact on your community.

State Farm agents get the opportunity to:

• Select, lead and develop their own team
• Maintain their own schedule
• Opportunity to travel the world
• Achieve financial stability through product line commissions, incentives and bonuses
• Get paid training with State farm benefits during their training period

Supporting you every step of the way

Your office may have your name on it, but you’re not in this alone. Throughout your State Farm agent career, you will have ongoing support and curated resources at your fingertips.

• Your local Agency Sales Leader is available to offer guidance with topics like development, business planning and marketing assistance.
• Agency Resources can help with questions about compensation, licensing and incentive programs.
• Our specialized support center provides 24/7 computer and IT support.

Your earnings

Leading a team, running a business and helping people every day is what being an agent is all about. Check out the added rewards of an already fulfilling career.

With multiple income streams, State Farm gives each agent the flexibility to determine their own income goals. Our independently contracted agents don't receive base compensation* but can earn commission, potential travel and other compensation by helping customers.

Individual startup costs and expenses vary based on business decisions, location and cost of living.

*Compensation is sales and commission based.

No base compensation is available with this opportunity. To determine actual compensation, the applicable State Farm Agent’s Agreement and corresponding schedule of payments must be used. Information contained herein does not guarantee eligibility to receive compensation or guarantee specific results. Eligibility and actual results will vary.

Getting started

Get a better understanding of some of the first steps and qualities we look for in our agents.

Qualities of our agents

Starting a career as an independent contractor State Farm agent can be a personally and financially rewarding decision. We look for people with entrepreneurial traits who want to make a difference in their community.

We also seek candidates with:

• The desire to network and build relationships with new and existing customers.
• Drive for personal and financial achievement; financial ability to begin and sustain a business.
• Ability to organize, operate and assume the risk of running a business.
• A strong track record of professional success; demonstrated success driving business results (not limited to insurance or financial services).

Taking the next step together

We've got your back. Get a better understanding of some of the first steps to becoming a State Farm® independent contractor agent.

• Connect with an agency recruiter
• The questionnaire can predict your likelihood of the success in this career
• An assessment to introduce the knowledge, skills, abilities and other attributes critical to success
• A candidate review is completed to evaluate credit history and overall financial means and eligibility to meet applicable licensing
• Learning modules and videos to gain a better understanding of this opportunity

The experience

With diverse backgrounds and experiences, nearly 19,000 State Farm agents serve our customers across the United States. We’ve collected agent testimonials and put together some resources that give you an inside look at what it’s like to be an agent.

Career reinvention

Community involvement

Connect with our team

To find the right career path for you, make a selection below. Your selections help us connect you with resources that best align with your goals and interests.

Like a good neighbor, State Farm is there.®

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© Copyright 2024, State Farm Mutual Automobile Insurance Company, Bloomington, IL

State Farm General Insurance Company: Update on California

Bloomington, IL, March 20, 2024 — State Farm General Insurance Company (“State Farm General”) is working to ensure its long-term sustainability in California. In doing so, State Farm General has had to make some difficult but necessary decisions that will impact a portion of our California policyholders as follows:

• Non-renew approximately 30,000 homeowners, rental dwelling, and other property insurance policies (residential community association and business owners). (A rental dwelling policy insures rental home owners. Renters insurance is not affected.)
• Withdraw from offering commercial apartment policies with the non-renewal of all of those approximately 42,000 policies. (A commercial apartment policy insures apartment owners. Renters insurance is not affected.)

These actions are California-specific and will occur on a rolling basis over the next year, beginning on July 3, 2024, for homeowners, rental dwelling, residential community association and business owners policies and on August 20, 2024, for commercial apartment policies. Combined, these policies represent just over 2% of State Farm General’s policy count in California.

This decision was not made lightly and only after careful analysis of State Farm General’s financial health, which continues to be impacted by inflation, catastrophe exposure, reinsurance costs, and the limitations of working within decades-old insurance regulations. State Farm General takes seriously our responsibility to maintain adequate claims-paying capacity for our customers and to comply with applicable financial solvency laws. It is necessary to take these actions now.

We also recognize the Insurance Commissioner’s proposed regulatory reforms, such as streamlining the rate application process, accounting for catastrophe modeling and reinsurance costs in rates, and addressing FAIR Plan vulnerabilities. We will continue to work constructively with the California Department of Insurance, the Governor’s Office, and policymakers to actively pursue these reforms in order to establish an environment in which insurance rates are better aligned with risk.  

We will notify customers impacted by this decision in advance of their policy expiration to provide information on other coverage options. State Farm independent contractor agents licensed in California will continue to service policies not impacted by these decisions. State Farm General’s May 2023 decision regarding new applications remains unchanged. We will evaluate the need for any additional business actions as market conditions change.

  *State Farm General Insurance Company is the provider of homeowners insurance in California

Media Contact

For over 100 years, the mission of State Farm has been to help people manage the risks of everyday life, recover from the unexpected and realize their dreams. State Farm and its affiliates are the largest providers of  auto  and  home  insurance in the United States. Its more than 19,000 agents and more than 65,000 employees serve over 94 million policies and accounts – including auto, fire,  life ,  health , commercial policies and  financial services  accounts.  Commercial auto insurance , along with coverage for  renters ,  business owners ,  boats  and  motorcycles , is also available. State Farm Mutual Automobile Insurance Company is the parent of the State Farm family of companies. State Farm is ranked No. 44 on the 2023 Fortune 500 list of largest companies. For more information, please visit  http://www.statefarm.com

• Best customer satisfaction
• Best affordability coverage
• Best for military
• Best for teen drivers
• Best for discounts
• Best for teachers
• Best for accident forgiveness
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Best Car Insurance Companies of 2024

Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate insurance products to write unbiased product reviews.

If you drive, you probably need car insurance. Nearly all states have liability insurance requirements for drivers. New Hampshire does not have these requirements, but don't mistake this for a free pass to get on the road unprotected.

Generally, it's a good idea to go beyond state minimums and opt for full coverage , which can be a mix of liability, comprehensive, and collision car insurance to ensure you've covered your bases in a wide range of scenarios. 

Best Car Insurance of 2024

• Best Customer Satisfaction: Amica Mutual
• Best Affordable Coverage: GEICO
• Best for Military: USAA
• Best for Teen Drivers: State Farm
• Best for Discounts: Farmers Insurance
• Best for Teachers: Liberty Mutual Insurance
• Best for Accident Forgiveness: Progressive

Compare the Best Car Insurance Companies

Auto insurance is a safeguard and can lessen the financial burden of a car accident, but only if you have the proper coverage. The best car insurance will offer solid coverage without going overboard on premium rates.

Here are the best car insurance companies of 2024.

Best customer satisfaction: Amica Mutual

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Many discounts and options to bundle insurance policies
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. high customer satisfaction according to JD Power's auto insurance study
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Long history in the insurance industry
• con icon Two crossed lines that form an 'X'. Not available in Hawaii
• con icon Two crossed lines that form an 'X'. May not provide the most competitive rates for higher risk drivers
• Ranks high in customer satisfaction
• Discount for students and vehicle safety

Founded in 1907 as The Automobile Mutual Insurance Company of America, Amica Mutual Insurance Company is well-regarded in auto insurance. Amica Mutual was ranked number one in JD Power's most recent U.S. Auto Claims Satisfaction Study, factoring in the experiences of over 8,000 participants who had filed and settled an auto insurance claim within the previous six months.

Amica car insurance also has an A+ rating from AM Best, which looks at a company's financial stability. The more financially stable a company is, the more likely it is to be around to pay your claims when you need it. So its excellent AM Best ranking gives many consumers peace of mind.

Amica offers liability, collision, comprehensive, and other common types of auto insurance. It also provides gap coverage, which can be helpful if you get into an accident with a vehicle you're currently financing. This covers any difference between your car's value and your loan balance in the event of a total loss. The exact limits and terms may vary based on the plan you buy. As such, we recommend speaking with an Amica agent to ensure you understand everything you need to know.

You can also opt for roadside assistance or get its premium option, Platinum Choice® Auto. It comes with glass repair with no deductible, rental coverage, new car replacement, and more. Amica also offers a mobile app to manage all your insurance needs.

Read our Amica Auto Insurance review here.

Best affordability coverage: GEICO

Discounts for airbags, anti-theft system, military, good student, good driver, multi-car discounts, and bundling insurance

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. National presence with coverage in all 50 states
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Buyers can bundle with homeowners, renters, and other insurance products
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Offers some of the most competitive auto insurance rates
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Claims adjusters may be able to reduce or eliminate deductibles on some claims
• con icon Two crossed lines that form an 'X'. Customer satisfaction varies across products
• con icon Two crossed lines that form an 'X'. Claims process may be longer than some competitors based on customer reviews

GEICO offers auto, homeowners, and life insurance. It's been around since 1936 and generally offers some of the lowest rates. However, customer satisfaction may be an issue.

• Discounts for safe driving, good grades, military, and more
• Available in all 50 states

If you want competitive and affordable car insurance rates, look no further than GEICO . According to the company website, you could save up to $500 by switching to GEICO. Customers can confirm the pricing in minutes with online quotes. With 85 years in the industry, GEICO offers affordable premiums and can be a good fit for those with poor credit.

To keep prices low, GEICO also offers numerous discounts to drivers, including discounts for safety devices like anti-lock brakes, seat belt use, defensive driving courses, and being a good student. In addition, policies can be managed online or via GEICO's app with 24/7 access to all policy documents.

The reviews we saw indicated GEICO's claims team was similarly quick, with a few mentions of adjusters who took additional steps to minimize or eliminate policyholders' out-of-pocket costs in a claim. From what we've gathered, rate hikes after an accident seem small compared to many other discount car insurance companies.

Read our GEICO Auto Insurance review here.

Best for military: USAA

Offers numerous discounts and get up to 30% off

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Low rates for eligible buyers
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Coverage is available in all 50 states and Washington, DC
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Auto policies can be bundled with other insurance plans and financial products
• con icon Two crossed lines that form an 'X'. Only available to military, veterans, and their families.
• con icon Two crossed lines that form an 'X'. Claims may take longer than with some other providers

USAA Auto Insurance could be a great option if you're a current or former military member; no one else is eligible. Coverage is available in all 50 states, and premiums are generally affordable.

• USAA auto insurance is open to the military, veterans, and their families
• Discounts for safe driving and more

USAA offers financial products and services to the military community, including competitive auto insurance. Though USAA products aren't available to everyone, those eligible won't find cheaper coverage elsewhere. Drivers who switched to USAA could save an average of $725 per year, according to USAA's website.

USAA offers standard car insurance options like liability, collision, comprehensive coverage, and uninsured and underinsured coverage. Optional coverage includes roadside assistance and rental reimbursement. USAA also sells home, pet, and life insurance, to name a few. So bundling insurance products is extremely common for military members and their families.

USAA also has plenty of discounts that only make sense for military members. For example, you could get up to a 15% discount when your vehicle is parked in a garage on base. You can also qualify for savings if you store your car or drive infrequently (which may apply to active duty military members being deployed).

Bundling home and auto insurance coverage with USAA gives policyholders a 10% discount. Setting up automatic payments for your car insurance premiums can reduce premiums by an additional 3%. If you insure two cars or more or your teen driver has good grades, you may be eligible for other discounts. USAA also has an app and offers 24/7 support online. USAA is unique in that whether you have a strong driving record or tickets and DUIs, USAA will still beat the nearest competitor's quote.

Read our USAA Car Insurance review here.

Best for teen drivers: State Farm

Offers many discounts, including good student discounts for high school and college students

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Nationwide presence
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. High customer satisfaction and claims satisfaction rankings
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Discounts for bundling insurance products
• con icon Two crossed lines that form an 'X'. Quotes are only available through captive agents (who only quote State Farm)
• con icon Two crossed lines that form an 'X'. Pricing may be higher or products unavailable for high-risk drivers
• con icon Two crossed lines that form an 'X'. Rates may rise quickly for households with teen drivers

State Farm auto insurance offers coverage across all 50 states and Washington, DC. It has comprehensive, collision, and liability coverage along with less common options like rideshare coverage.

Given the increased risk factors, car insurance for teen drivers can be costly. Teen drivers don't have the same levels of experience behind the wheel and may engage in risky driving behaviors. In fact, car crashes are the top cause of teen deaths, according to the Centers for Disease Control and Prevention (CDC) .

Experts recommend adding any licensed driver in your home as soon as you know they'll drive your car regularly. State Farm has excellent options for teen drivers. It offers a Good Student Discount of up to 25%. Also, you could get another discount if your teen driver is under 21 and takes a qualifying driver's ed course. There's also a unique option to save if your teen driver has a car at home but moved away for school through the Student Away at School Discount.

The Steer Clear discount offers young drivers below 25 up to a 15% discount with no at-fault accidents or moving violations in the previous three years. In addition, if you're willing to use State Farm's Drive Safe & Save app, you may qualify for up to a 30% discount.

Along with its liability, collision, and comprehensive coverage, State Farm offers emergency roadside service, rideshare coverage, and other auto coverages. You can work with one of its many insurance agents nationwide to find the best coverage for you and your teen driver.

Read our State Farm Auto Insurance review here.

Best for discounts: Farmers Insurance

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Diverse coverage options for qualified buyers
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Wide array of discounts and bundling options
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Available in all 50 states and Washington, DC
• con icon Two crossed lines that form an 'X'. Prices may not be competitive against many budget auto insurance companies
• con icon Two crossed lines that form an 'X'. Online quoting may not be as easy as some competitors

Farmers Insurance is a full-service insurer offering home, life, business, and auto insurance with a long list of discounts compared to other insurance providers. Farmers offers up to 23 discounts when many other providers provide fewer than 12.

Policyholders paying premiums in full, senior drivers taking safe driving training, California drivers driving hybrids or electric vehicles, homeowners, good students, and young drivers are just a few groups enjoying discounts on auto insurance with Farmers. You also stand to save up to 20% by bundling plans or qualify for another discount insuring multiple vehicles.

Along with liability, collision, and comprehensive, Farmers offers umbrella policies to boost coverage on multiple plans (if you're bundling). All plans can be managed through the Farmers app.

Read our Farmers Auto Insurance review here.

Best for teachers: Liberty Mutual Insurance

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Quotes can be obtained online or through a Liberty Mutual or broker agent
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Bundling discounts are available for interested buyers
• con icon Two crossed lines that form an 'X'. Discounts for young drivers may require more paperwork
• con icon Two crossed lines that form an 'X'. Rates may not be competitive for higher risk drivers
• Get up to 30% in savings with the RightTrack program
• Military members receive a discount
• Specialized coverage for teachers
• Required coverage for vehicles traveling to Mexico

Many teachers enjoy lower prices, more perks, and greater customer satisfaction with Liberty Mutual car insurance. The company has coverage for teachers, though some plans are unavailable in some states.

Perks include a $0 deductible on collision coverage if you get into an accident during school hours or while working (ex: a coach driving to another school for an after-school sports game). Teachers also enjoy up to $2,500 in personal property coverage if teaching items or school-owned items are damaged or stolen. In addition, Liberty Mutual automatically applies a $0 deductible when qualifying cars are vandalized on school property or when driving on school-specific business.

Through Liberty Insurance, you can get typical collision or comprehensive coverage. It also offers optional coverages like original parts replacement coverage, gap coverage, 24-hour roadside assistance coverage, rental car reimbursement coverage, and more.

Unlike competitors, Liberty Mutual also has a Liberty Mutual Deductible Fund®. You pay $30 toward the deductible fund each year, and Liberty Mutual drops your deductible by $100. If you file a claim, the fund can lower out-of-pocket costs. You can download the company's app to check in with your policy or file a claim.

Read our Liberty Mutual Car Insurance review here.

Best for accident forgiveness: Progressive

Offers personalized rate based on driving

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Coverage available in all 50 states
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Discounts for bundling insurance products with competitive rates
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Highly rated with JD Power and AM Best
• con icon Two crossed lines that form an 'X'. Rates may jump significantly after your first accident or for higher risk drivers
• con icon Two crossed lines that form an 'X'. Mixed reviews on claims and customer service on sites like Consumer Affairs and TrustPilot

A highly ranked and long-standing insurance company, Progressive offers auto, home, motorcycle, and other insurance across the United States.

• Ranked #17 out of 18 in auto claims satisfaction
• Bundling, vehicle safety, and student driver discounts
• Name your price tool

Accidents happen, and the best car insurance companies can help. But rates inevitably rise after even a minor accident. Progressive notably offers accident forgiveness to qualifying drivers. Its three types of accident forgiveness coverage include the following:

• Small Accident Forgiveness. This option is available to new Progressive customers in most states through the Loyalty Rewards program and won't increase your premiums if your claim is at or below $500. This said, it's worth noting that when deciding whether to file a claim, you should always consider your deductible and how much your insurance will pay.
• Large Accident Forgiveness. Customers in most states may qualify for this option through the Loyalty Rewards program. Drivers eligible for Large Accident Forgiveness won't see increased rates even if claims exceed $500. You must be a Progressive customer for five consecutive years with no accident or moving violations within that time frame.
• Progressive Accident Forgiveness. You may qualify to have one accident forgiven in a specific period, but you can buy additional accident forgiveness through this program. In a sense, you are prepaying to keep your rates consistent if you're involved in an accident. Check if your state qualifies, as it's not available everywhere.

You can obtain liability, collision, and comprehensive coverage through Progressive. Interestingly, Progressive specifies if your pet is injured and you have collision coverage, your policy will cover some vet expenses.

It also offers gap coverage, rental car reimbursement coverage, custom parts and equipment value, rideshare coverage, and roadside assistance. Progressive also has a Name Your Price option that allows you to state your desired price, and the website will show what's available. You can also use their mobile app or contact Progressive agents for support.

Read our Progressive Car Insurance review here.

Best Car Insurance Frequently Asked Questions

State Farm is highly ranked in many JD Power surveys and maintains the highest market share of any auto insurance company in the United States. The company is known for exclusive insurance quoted only by State Farm agents. However, it is outperformed in some areas by smaller regional carriers. Some insurers are even limited to just one state, like 21st Century auto insurance , which only serves California.

JD Power's latest auto claims satisfaction study shows Amica Mutual earned the top spot. In JD Power's auto insurance study, regions were won primarily by smaller local carriers like Wawanesa in California and Erie Insurance in the mid-Atlantic. The best car insurance company may also vary based on the coverage you want.

The average cost of car insurance will vary depending on your location and other factors. Many auto insurance companies offer discounts for safe driving, especially if you're willing to install an app to track certain driving behaviors. Paying your premium in full instead of month-by-month also reduces rates. One of the best ways to reduce costs is by getting multiple quotes to compare quotes. 

The easiest way to compare quotes is by working with a licensed independent insurance agent. They can run quotes, compare prices and coverage so you know you're getting the best value. Some customers also prefer to go online. Companies like GEICO, Progressive, and Lemonade offer online-only quotes to give consumers back control.

For car insurance market share, State Farm's biggest competitor is GEICO. According to data from the National Association of Insurance Commissioners (NAIC), State Farm has 16.84% of the U.S. auto insurance market share, the highest of any insurer. Next up on the list is GEICO, with 14.05% market share. Both insurers are available throughout the U.S.

Why You Should Trust Us: How We Chose the Best Car Insurance Companies

To determine the best auto insurance companies, we compare numerous factors included in our insurance rating methodology . These include affordability, customer satisfaction, coverage options, optional coverage, benefits for policyholders, financial strength, and accessibility. No single factor accounts for everything consumers need; not all auto insurance companies are created the same.

We compared quotes, customer reviews, financial stability, and the company's history. With all these factors combined, we rate numerous competitors to see which companies rise to the top. 

Auto insurance, in particular, is primarily run on a state and regional basis. In short, most auto insurance providers are only licensed in some states. As such, the best car insurance companies for a driver in New York may differ from the best option for similar drivers in California.

We use numerous sources to get an objective view of each provider. Our reviews are not sponsored by the companies being reviewed. Each review reflects our opinion based solely on the facts gathered. Reviews may be updated as facts change (for example, JD Power rankings are updated when new reports are released). However, requests from insurers that conflict with public-facing websites are not factored into our reviews.

Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards .

Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

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Best Life Insurance of May 2024

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Life insurance is as complicated as the policyholders and beneficiaries who use it. That means there's no single "best" life insurance company. Instead, you can find the best option based on what you want or what you prioritize.

Our top picks for the best life insurance

Best for customer satisfaction: state farm life insurance.

• Best for older adults: Prudential Life Insurance
• Best for agent support: New York Life Insurance
• Best for long-term care: Columbus Life
• Best for high returns: Allianz Life
• Best for term life: North American Company

How we rate the best life insurance companies »

Compare life insurance companies

While there is no such thing as the objective best life insurance policy, you will be able to find the best insurance policy for your specific needs. Here are our picks for the best life insurance companies, whether you want to use your life insurance policy to build wealth through cash value or you're just looking for a term life insurance policy .

State Farm Life Insurance gets the best life insurance ranking in J.D Power's Individual Life Insurance Study, with a score of 843/1,000. The company is also ranked A++ with AM Best for its financial stability with term, universal, and whole life insurance options. 

All State Farm policies have to be purchased through a State Farm agent. Your agent can help you bundle and save or buy one policy. State Farm is also among the companies offering "survivorship universal life insurance ," which means the policy covers two people, and it kicks in after the second person dies. Couples looking to maximize their death benefit for beneficiaries with one premium payment each month may enjoy lower overall costs.

State Farm agents can run quotes and compare options to find the right plans for each applicant. The range of options, discounts, and familiar name all contribute to the popularity of State Farm's life insurance.

Read our State Farm Life Insurance review here.

Best for older adults: Prudential VUL Protector Life Insurance

Prudential Life Insurance is available in all states except New York. New York residents can buy the Pruco Life of New Jersey VUL Protector plan. This plan allows buyers to pull money out of their plan to pay for nursing home expenses. Cash value policy premiums are fixed, so you won't have to worry about extra costs later on. Internal costs are low, which minimizes risk. Due to age, many older adults want a safe investment option for their money. Prudential VUL Protector invests to avoid loss. That also means you're not as likely to see big increases in your available funds outside of what you deposit.

Read our Prudential Life Insurance review here.

Best for long-term care: Columbus Life Insurance

Columbus Life offers a wide range of riders to customize your policy with affordable premiums. The company also allows you to convert term policies to whole life insurance policies until the end of your term (generally around age 70). For this and many other reasons, customer satisfaction is high.

When using living health benefits (otherwise known as accelerated death benefits), buyers are allowed to pull money from policies early to pay for medical bills, living costs, etc. under certain circumstances. Most companies use a discounted death benefit, which reduces your final payout using two models. Columbus uses the lien method, which makes it easier to calculate the financial impact of pulling money out early.

Best for high returns on income: Allianz Life Insurance

Allianz Life plans are geared towards high-income adults looking for more tax-free income. Allianz offers a 40% multiplier bonus with a 1% annual assets charge. In short, the professionals managing your investments take 10%. Overall, your investments would pull in an extra 14%-1% asset charge. This means you end up with 3% more than what you deposit every year your life policy is active. This plan offers strong returns when using a life policy to supplement your retirement savings. Allianz also offers specialized plans to grow your income by as much as 20% according to some estimates.

Of note: Allianz also offers plans for foreign nationals, including those with H-1B visas.

Best for agents: New York Life Insurance

New York Life Insurance agents go through extensive training before they ever hit the sales floor. What does this get you? Policies vary widely, and New York Life offers both large and small payouts. Some policies have significant penalties for early withdrawal, but taking a loan offers more options. Whatever your questions, New York Life agents are trained to offer comprehensive support giving you accurate information about its policies every time. The company comes in at position eight in J.D. Power's latest life insurance customer satisfaction study.

Read our New York Life Insurance review here.

Best for term life: North American Life Insurance

North American Company offers term policies alongside accelerated death benefits for critical, chronic, and terminal illnesses and more. The company allows one conversion on a 20-year policy at 15 years or 70 years old (whichever is earlier). The conversion cannot happen later than the five-year marker regardless of which policy you choose or the length. North American Company also offers a term policy with a lower premium renewable up to the age of 95 for qualifying insureds.

How to pick the best life insurance policy for you

Finding the right fit in life insurance starts with finding a trusted insurance agent. Because there are so many state regulations, shopping for homeowners or auto insurance can be easily done online. Life insurance is not required. So it's a voluntary purchase. Many buyers don't know what they need or when they need it. Before making your selection, consider a few things:

Some companies will sell you a policy for your child as soon as they're born. While this may seem morbid, early sign-up means lower rates for a policy your child could enjoy in the future. Regardless, early sign-up equates to more policy for lower premiums and a higher likelihood of acceptance. At 20, you may be healthier and be able to pay into the policy for a longer period compared to when you're 50 with more age-related conditions.

As a general rule, never agree to more than you can afford. For the average life insurance agent, their job is to sell you a large policy with a large commission. Consider not only how much you make now, but how likely your current income is to continue. If you work on a project basis and your project is scheduled to end in 12 months, you may want to reconsider a policy premium outside your monthly savings.

How much are you prepared to buy? Some people only want a small policy to cover funerals and other end-of-life expenses. Others build a life policy into their retirement plan. Whatever direction you're going, involving a financial planner could help you make the right decisions. Depending on the carrier, customers can also compare set limits with index universal life policies, which set no limit. These policies never expire, and the value builds over the entirety of your life.

Living Benefits

Life happens unexpectedly. You could be healthy one day and in the hospital the next. Many life policies offer living benefits. These allow you to draw a limited amount out of your policy to cover medical and other bills you cannot pay while sick.

Much like a 401(k), many life insurance policies have penalties for early withdrawal. No matter what policy you want, this question is critical to an informed decision. It's a question of how early you can withdraw and how much you'll lose from the total to have the money in 10 years instead of 30 or after death.

Some policies require insured parties to pay premiums for at least one year before any significant payout would be available. Suicide exclusions are common. Even with no medical exam policies, the company may still do a check for known conditions. An insurance company has to mitigate its risk.

Flexibility

Once you've been denied a life insurance policy, a mark goes on your record. No matter the reasons, other insurance companies may deny you coverage based on the first denial. So consider your whole situation and choose your policy carefully before you submit any applications. Some policies have greater flexibility if you lose your job or otherwise can't make payments. Others will lapse if you miss even one payment.

Payment Type

Even within whole life or term life insurance policies, customers have the option to choose guaranteed fixed or variable rates. Some have guaranteed payouts, but you'll need to ask your agent for details.

What is your intended use? Why are you shopping for a life insurance policy in the first place, and what are your goals? Many successful financial planners also have a background in life insurance. So while they may not be able to find you a specific life insurance policy, financial planners can help you set out a blueprint for your purchase.

How we review life insurance companies

In life insurance, it's easy to get "sold a bill of goods." Many life insurance agents pass a state test to be thrown into the deep end. Agents sell the company product, but not all know the products. In this vein, we look at the products each company offers. We also look at agent training.

A good life insurance agent may not volunteer all facts upfront. But a company's agents should answer questions about its products accurately and in a way the average consumer can digest. Agents should be able to inform you about the long-term benefits and limitations. This will help customers find the right policy for their long-term plan.

We consider affordability, policy sizes available, and performance for a comprehensive assessment in our insurance rating methodology . If you can, we recommend also working with a financial advisor to make a plan for your future with life insurance.

Our Expert Panel for The Best Life Insurance Companies

To inform our choices for the best life insurance companies, we spoke with the following experts:

• Paul LaPiana , head of product at MassMutual
• Barbara Pietrangelo , CFP, CLU, and chair of the nonprofit Life Happens
• Wykeeta Peel , Corporate Vice President and Market Manager, African American Market Unit at New York Life

The Experts' Advice on Choosing The Best Life Insurance for You

How much life insurance coverage do you believe the average buyer should have.

Paul LaPiana, Head of Product at MassMutual

"There are different approaches to determining how much life insurance you need. One is the 'human life' approach, which estimates the current value of your future earning potential. Another is securing specific coverage to pay off debts such as a mortgage or provide for the education of children. A comprehensive protection plan should provide the right amount of coverage over the course of your working life and into retirement."

Barbara A. Pietrangelo, Chair of Life Happens

"There is no one-size-fits-all life insurance policy because everyone is different. One way to get a rough estimate is to multiply your income by 10 to 15; another is adding $100,00 to that amount, should you have a child and anticipate college education expenses.

Your best bet is to talk to a financial professional or use the Life Insurance Needs Calculator on LifeHappens.org to analyze what's right for you."

Wykeeta Peel, Corporate Vice President & Market Manager African American Market Unit at New York Life

"As you consider what policy best meets your needs, it can help to answer four key questions: First, how much death benefit do you need? Second, how long will you need that coverage? Third, what is your budget (or how much monthly premium can you afford to pay?), and finally, what is your investment risk tolerance?

To determine how much death benefit makes sense, it's helpful to think beyond using life insurance to cover funeral expenses and consider whether anyone is relying on the policy owner's income to maintain a lifestyle, pay rent or a mortgage, or fund a child's education and for how long.

There are various rules of thumb regarding the right amount of Life insurance coverage. Some tips can be found online, but they only provide an estimate and don't necessarily factor in an individual's specific needs. In my opinion, human guidance, powered by technology, is required. Basically, it comes down to how much money your loved ones would need to remain on firm financial ground if your earnings were no longer in the picture and that is different for everyone."

What is the biggest opportunity you see for improvement in the life insurance industry?

"Increased accessibility through digital and other channels as well as through underwriting enhancements. Increased tailoring of products and features. And an increased emphasis on health and wellness programs."

"Having enough qualified insurance professionals to walk potential buyers through the multiple benefits of life insurance will be pivotal to the growth of the industry. Education is a key factor here, as professional agents also need to be able to explain life insurance and its benefits in an easy, digestible way, especially when there are so many misconceptions about life insurance."

"The need for life insurance is greater than ever. In fact, a recent New York Life Wealth Watch survey found that 37% of adults have been thinking about life insurance more often these days – and half of adults report that financial products that provide protection (50%) and reliability (50%) are more important now compared to last year. This may be especially true for middle-market and Cultural Market families.

Our organizational structure of having Cultural Market agents embedded in the communities where we live and work allows us to understand the needs of diverse communities and develop solutions that resonate with them."

What advice would you give to buyers who are debating whether or not to buy life insurance?

"It is difficult to say with any certainty how healthy you will be years from now. That's why securing life insurance, and insuring your insurability, today, when you are the youngest you'll ever be again, and perhaps your healthiest is a wise decision."

"Do you love someone? If the answer is yes, then life insurance is certainly something you should consider. Many buy gifts and experiences to express their love, but haven't considered that life insurance is just another way to say I love you. Nothing says support like ensuring your family's financial security and peace of mind."

"If you have someone depending on your income, you should consider purchasing life insurance. A death benefit from a life insurance policy can replace income from the loss of a breadwinner, ensure a family can stay in their home, fund educational or retirement expenses, address debt and so much more.

A life insurance policy can also help you grow your family's wealth over time. Once the risk of an unexpected loss has been managed, you can begin to think more broadly about your family's financial future. Life insurance can enable your mindset to shift from death to growth."

What's the most important thing buyers should look for when choosing a life insurance agent/company to buy from?

"With life insurance, you are securing a future commitment that may be decades away. Research the company behind the policy to ensure it has high financial strength ratings, longevity, and an excellent track record of paying claims."

"When looking for an insurance agent or company, be sure to do your research. When comparing companies, be sure to remember that the policy features that fit you and your loved ones best is the most important factor. Don't automatically assume you should buy from the higher-rated company.

If the policy from the other company has more of what you're looking for, it might be the better choice. If you're unsure where to start, try the Life Happens Agent Locator to find an insurance professional in your area."

• "The insurers' track record: At its core, life insurance is protection - a hedge against the unexpected - and you are paying premiums in exchange for the promise that the insurer will be there when you need them, so the financial strength and track record of the company backing your policy is critical.
• Customer service: Are service professionals available by phone and digital channels? Is there is an online dashboard where you can manage your policy? Beyond ensuring assistance is available after you purchase a policy, it's also critical to ensure you have access to trusted advice and guidance before you buy.
• Flexibility in conversion: How easy is it to change? Life can be unpredictable and while term insurance can cover your loved ones through a critical period of time, you may decide that access to cash value is an important piece of your strategy.
• Accelerated online applications : Online applications are convenient but don't replace human guidance. Keep in mind that accelerated online applications may have a maximum coverage amount, meaning that you may not be able to get all the coverage you may need exclusively through an online process.
• A range of payment options: It's important to understand how often you're required to make premium payments and whether and how often you can change the frequency of payments."

Best life insurance FAQs

What is the best life insurance company.

According to JD Power's 2023 life insurance study, State Farm is the highest-rated life insurance company when it comes to overall customer satisfaction. However, you still may want to shop around for quotes from various insurers if you're looking to purchase a new policy.

Which company life insurance is best?

There isn't one best life insurance company, because the best option for you will depend on the type of policy you're looking for. It's best to work with a qualified insurance agent to help you find the best coverage. If you're deciding between multiple similar options, it's also worth consulting J.D. Power's life insurance customer satisfaction study . The latest study ranks State Farm as the top pick for individual life insurance, outpacing Nationwide by three points.

What type of life insurance is best?

The best type of life insurance policy for you will differ from someone else's, as your policy should be tailored to your needs. The best policy for you will be affordable and will offer the benefits best suited to your situation. For example, some policies are only meant to cover end-of-life expenses such as burial and funeral arrangements, whereas others include living benefits like a cash value insurance plan , which you can borrow against during your lifetime.

Are medical exams required for life insurance?

Some life insurance policies are advertised as "no medical exam." This doesn't mean the insurer won't ask you about known conditions or look at medical records. Policies with no medical exam also tend to offer lower benefits with higher premiums. Most companies have a network of medical examiners, some of whom can come to your home. You can find our guide on the best no exam life insurance here.

How do I find the best life insurance policy for me?

Each situation is different and requires a knowledgeable life insurance agent to assess your best options. Bring all your questions and the coverage you're looking for to an insurance agent near you to explore your options.

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Longtime State Farm agent Marilyn Lewis retires, passes business to Lydia Romero and Nicole Williams

State Farm agents Nicole Williams, Lydia Romero and retiring State Farm Agent Marilyn "Mert" Lewis.

Marilyn "Mert" Paoli Lewis retired on April 30 after 42 years as a State Farm Agent. She started her career as a Scratch Agency in 1982, meaning she had no customers initially.

Over the years, she built an agency serving almost 4,000 households in the Carson City area and consistently ranked in the top 1 percent of State Farm Agents. Mert received multiple honors and awards, including Presidents Club, Chairmans Circle, Crystal Excellence, and Ambassador Club. She also achieved professional designations as a Financial Advisor and was recognized as "Best of Carson" for Financial Planning, Best Insurance Agent, and Best Customer Service.

Mert's book of business will be shared by two State Farm Agents, Lydia Romero and Nicole Williams.

Lydia Romero, who worked as Mert's Office Manager and right hand for a decade, will become a State Farm Agent starting May 1, 2024. Lydia is a 30-year resident of Carson City and has strong ties to the community. Her husband, Greg Lehman, is also a business owner in Carson City. The new office is located at 2085 E. William St #20, between Gold Dust West and Tractor Supply. Lydia is excited to continue Mert's commitment to excellence in a new environment.

Nicole Williams, a highly successful 12-year State Farm Agent in Reno, has opened her second location at 321 W. Winnie Ln. #106, which was Mert's former office location. Nicole, who was born and raised in Carson City, is honored and thrilled to be opening a location in her hometown. She has received numerous awards as a top agent within State Farm and is fully licensed in Insurance, Financial Services, and Securities.

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• Bureau of Competition

The following outline provides a high-level overview of the FTC’s proposed final rule :

• Specifically, the final rule provides that it is an unfair method of competition—and therefore a violation of Section 5 of the FTC Act—for employers to enter into noncompetes with workers after the effective date.
• Fewer than 1% of workers are estimated to be senior executives under the final rule.
• Specifically, the final rule defines the term “senior executive” to refer to workers earning more than $151,164 annually who are in a “policy-making position.”
• Reduced health care costs: $74-$194 billion in reduced spending on physician services over the next decade.
• New business formation: 2.7% increase in the rate of new firm formation, resulting in over 8,500 additional new businesses created each year.
• This reflects an estimated increase of about 3,000 to 5,000 new patents in the first year noncompetes are banned, rising to about 30,000-53,000 in the tenth year.
• This represents an estimated increase of 11-19% annually over a ten-year period.
• The average worker’s earnings will rise an estimated extra $524 per year. 

The Federal Trade Commission develops policy initiatives on issues that affect competition, consumers, and the U.S. economy. The FTC will never demand money, make threats, tell you to transfer money, or promise you a prize. Follow the  FTC on social media , read  consumer alerts  and the  business blog , and  sign up to get the latest FTC news and alerts .

Press Release Reference

Contact information, media contact.

Victoria Graham Office of Public Affairs 415-848-5121