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State Farm Home Insurance Review

State Farm dominates the home insurance market, covering 18% of all insured homes in the country. We review to see if State Farm lives up to their popularity.

Today, State Farm is by far the largest and one of the most popular home insurance providers in the country. With good financial performance and strong market presence driven by 19,000-strong agents, it enjoys practically 18% of all insured homes according to the National Association of Insurance Commissioners. While existing and prospective clients have easy access to local agents, we cannot directly correlate how this translates into a favorable experience or customer satisfaction.  We did a thorough review to provide valuable insights for homeowners who are considering State Farm for their home insurance needs.


On The Total Scale


State Farm has impeccable financial strength. The capacity to pay is there. It’s popular, accessible, and respected within the industry. However, while State Farm enjoys a comfortable gap away from the competition, the question of why discount perks are not uniformly extended to every state remains. Initially, we thought that it may be the market share or the actual volume of business, but studying closely, we saw how New York, a top contributing state, number 4 in national ranking does not enjoy the attractive discounts that are extended to others. Clearly, it’s not about volume or market share. To our honest opinion, State Farm remains to be a viable option, but we suggest that you compare it with the other providers and find the one that serves you best.


If you are the homeowner who would prefer a policy that is adaptable beyond the bounds of the standard package, you may want to consider other options.


Customer service, though quantifiable is quite subjective. While we’ve come across an almost equal number of satisfied and disappointed customers, we do believe that the 2018 Home Insurance Study from J.D. Power presents a more comprehensive and accurate data that reflects a clearer picture of how State Farm customers perceive their insurance provider to be.

Pros

Satisfied Homeowners


State Farm enjoys an average rating with respect to customer satisfaction. In  J.D. Power’s 2018 Home Insurance Study, State Farm was given the rating 3 out of 5 Power Circles, which J.D. Power translated to About Average in overall consumer satisfaction. The study included 14,122 homeowners and renters who participated in online interviews that took place in the summer of 2018. The study participants were asked to rank their experience with State Farm in regards to overall satisfaction, policy offerings, price, billing process and information, interaction, and claims. With an average of about 400 agents in every state, access to information and customer service should not be a major concern.


Strong Financials


If you worry about your insurer’s financial strength, spare yourself the worries as A.M. Best and S&P  Global Ratings gave an A++ and AA for Superior financial strength and Very Strong ability to pay, respectively.


Useful Tools For Policyholders


Now, let’s go through the tangibles. One distinguishing feature about State Farm’s website is its inventory tool. Wouldn’t it be great if you can keep a list of the items in your house with their corresponding financial value? In case they get destroyed, you save yourself the trouble of remembering what you had and how much they cost. Your inventory comes in handy should you need to file a claim. In addition, to help clients make better decisions, State Farm provides a home insurance calculator that lets you know how much insurance coverage you should avail of. On their website, clients will also be guided with detailed questions in relation to their quoting process making it easier to understand and easier to decide.


The Discounts


State Farm offers a variety of discounts to help cut the costs. They are:


  •  Multi-policy discount
  • Safety device discount
  • Roofing discount
  • Higher deductible discount

Call your local agent to find out which one applies to you.

Cons

Inconsistency With Their Offerings


While State Farm boasts good industry ratings, the competitive advantages don’t seem to be enjoyed by consumers on a uniform level. Discounts differ across regions and are totally not available in 5 states that include AlaskaNew YorkNorth DakotaPennsylvania, and South Dakota. That’s considering State Farm enjoys the top spot in all these states. It’s quite confusing how these perks are not extended to clients who may even be paying higher insurance packages. New York for one, accounts for 763,921 home insurance policies following Illinois which makes it to the 3rd spot with 1,110,598 enrolled households.


Conservative Policies


Let’s take a look into the insurance coverage. It’s fairly conservative to offer the standard coverage in home insurance plans. While standard features cover the basics, there’s no such thing as one size fits all. A considerable number of homeowners would have specialized requirements to cover properties or assets that are not stipulated in their policy. Sadly though, State Farm home insurance sits just right in the middle. Yes, it’s financially strong and has good industry ratings, but its rigid and conservative package limits its own potential as a viable choice.


Unresolved Issues


Further, we did some research on individual client experience and surprisingly, the proportion of those who reflect the good customer service rating to those who are unhappy seem to rest at the 50-50 mark.  The promptness of service and the quality of assistance turn out to be the major unresolved issues.



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