State Farm Homeowners Insurance Review

State Farm is among the largest of home insurers and has ranked number one in home insurance since 1964, according to data from the S&P Global Market Intelligence and State Farm Archive. With State Farm’s size and experience comes certain perks and conveniences for the customer. State Farm has close to 19,000 agents working for them within the U.S. and just under 58,000 employees. This translates into a lot of people aimed towards getting you the service you want. State Farm home insurance was recognized by J.D. Power with a 4 out of 5 for overall customer satisfaction, ranking fourth in total.

State Farm excels at the simpler elements of home insurance: standard coverage. It provides affordable policies that cover the necessities but have less comprehensive coverage than some of their competitors. For instance, State Farm might not be your best bet for 15 billion in claims and loss adjustment in 2018, but according to the J.D. Power report on claims satisfaction, State Farm homeowners insurance ranks average with a score of 3 out of 5 in all five of the associated categories.

Finally, whether State Farm home insurance is the “first and the best choice.” It certainly ranks high on all the charts that keep track of home insurers, but it isn’t consistently number one across the board. State Farm does report being ranked first in homeowner’s insurance by S&P Global Market Intelligence, but it ranks fourth in overall customer satisfaction on the J.D. Power report and fifteenth on claims satisfaction.

Considering these stats, State Farm home insurance can’t be said to be the universal first and best choice, but it did state it as a goal for the future, so we’ll see if the company improves those rankings moving forward.

Our deep dive

Basic coverage

Here is what is included in State Farm’s basic coverage option:

• Home coverage: This covers your home’s structure and anything attached to it such as a garage.
• Other structures coverage: This protects structures on your property that are detached from your house, such as fences or shed. Basic coverage includes these structures as 10% of your dwelling coverage.
• Personal property coverage: This part of your plan covers the belongings in your home. Some categories of your belongings may have limits and need additional coverage to fully protect them.
• Liability coverage: Liability coverage helps cover your legal expenses you if a third party is injured on your property.
• Guest medical coverage: This provides funds for medical treatment if a third party is injured on your property.
• Additional living expense coverage: If a covered peril damages your home, this will cover the costs of temporary living expenses such as hotels and eating out while your home is repaired.

Discounts

State Farm offers several discounts to help reduce your insurance rates. Here are some of the discounts you might be eligible for:

• Multiple line discount: You can get a discount if you purchase more than one type of policy from State Farm.
• Home alert protection discount: You can get a discount if you have safety features in your home such as a security system or fire alarms.
• Roofing discounts: You can get a discount if you use certain types of roof products. See theState Farm qualifying roofing products listing for details on which products are eligible.
• Higher deductibles: You can get a higher deductible to lower your premium. Remember that a higher deductible means you have to pay more before the insurance will help cover damage or loss.

Cost rundown

Home insurance premiums vary from case to case, and the only way to accurately see what it will cost to insure your home is to use the State Farm homeowners insurance free quote tool.

Numerous factors are taken into account by State Farm when calculating your premiums, including credit rating, home size, home location and value of the home. Below is an expanded list of factors that can affect your homeowner’s insurance premiums.

• Replacement cost: This is the total amount it will cost to rebuild your home. It is for the structure itself and doesn’t include the land.
• Deductible: The higher your deductible, the more you have to pay out of pocket before your policy will kick in, but the lower your premiums will be.
• Home liability limits: Higher home liability limits will cover higher costs but cause an increase in your premiums.
• Insurance score: A low insurance score can raise the cost of your premiums. This score is like a credit rating but specifically for insurance.
• Marital status: Having a status of married can sometimes lower your insurance premiums as the industry has statistics showing that married couples file claims less often than singles.
• Age and construction of home: Older homes tend to cost more to rebuild, and this is reflected in slight premium increases.
• Swimming pool or hot tub: Such features often require a higher limit for liability coverage and will reflect that in your home insurance premiums.
• Roof condition: Old roofs provide less protection for the structure of your home and so are calculated as increasing the risk of damage from the elements. Older roofs often mean higher premiums.
• Proximity to fire station: The closer you are to a fire station, the better your home’s chances of surviving a house fire. This tends to be reflected in the cost of your policy.
• Credit history: Credit records can have a significant impact on the cost of your policy. The better your credit rating, the less you’re going to pay.
• Claims history: The more claims you’ve filed in the past, the more claims insurance companies think that you’re going to file in the future. This often leads to increases in policy costs.

Cheaper (or free!) alternatives

Homeowner’s insurance is a requirement that can’t be avoided, but that doesn’t mean you can’t be strategic when purchasing your policy. This is such a hot topic that Forbes has put out some basic guidelines for how to save money on your homeowner’s insurance.

• Shop around: When buying an insurance policy, get quotes from multiple insurance companies so you can compare what they will cover and what they will charge.
• Improve your home: Making upgrades to your home that reduce risk factors can make your premiums cheaper. These are things like improving the wiring to minimize the risk of fire or improving the plumbing to mitigate the risk of water damage.
• Agree to a higher deductible: Paying a higher deductible will cost you more out of pocket when things go wrong but will reduce your premiums.
• Use discounts: Most insurance companies offer various discounts. In the right situations, these can save you a lot of money.

The competition

Only four insurance companies ranked higher than State Farm on the J.D. Power home insurance study. State Farm received a 4 out of 5 rating. When considering purchasing a homeowner’s policy with State Farm, these are the companies you’ll want to compare with.

Amica Mutual:

• J.D. Power rating: 5 out of 5
• Better than usual coverage for work-related property in the home.

USAA:

• J.D. Power rating:5 out of 5Competitive rates for best-in-class coverage.
• *Only accept contracts with those who have served in the U.S. military or have a family
• connection that has served with the U.S. military.

Erie Insurance:

• J.D. Power rating: 5 out of 5Has a guaranteed replacement cost for your house that doesn’t
• lower money based on wear.
• One of the few insurers to cover the loss of your pets up to a limited amount.
• *Limited availability as it provides coverage in only a handful of states.

Auto Club of Southern California Insurance Group:

• J.D. Power rating: 4 out of 5Potentially excellent discounts for AAA club members.
• *coverage and discounts vary by region.

What others are saying

Consumer Advocate:
“Consistent customer satisfaction remains one of State Farm’s most important priorities, and they consistently receive high ratings in this area.”
State Farm’s rating within the J.D. Power report supports this claim. While it isn’t ranked the highest, State Farm is near the top and has consistently scored high on these customer satisfaction metrics.

Heather of Gravette, AR, via Consumer Affairs:
“We had pretty high winds here in Arkansas and a lot of shingles had blown off. We filed a claim and State Farm paid for total replacement for a new roof! I was very happy with their service.”

While not every customer has reported such a smooth and positive experience, State Farm consistently gets more positive reviews than negative ones.

The bottom line

While there are companies that rank higher than State Farm, it remains one of the best home insurance companies with greater ease of access than many of its higher-ranking competitors. When it comes to purchasing a policy for your home, State Farm home insurance is a safe bet.

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