State Farm Life Insurance: What you need to know
State Farm is one of the big players in US insurance. As well as providing life insurance, it is the biggest auto insurer in the country and also insures just short of a fifth of all the nation’s home owners. Size isn’t everything, of course, but it does have relevance in the insurance market. State Farm’s financial strength is rated at A++, which means it is never going to have trouble fulfilling its obligations to customers.
Size is also good when it comes to geographical coverage. State Farm operates a huge network of agents - 18,000 or more at last count - so you’re more likely to be able to find an agent in your locality.
And of course, size denotes popularity. State Farm is doing something right. The company’s overall customer satisfaction rating in the latest annual JD Power life insurance survey is almost as high as award winner Northwestern Mutual.
State Farm Life Insurance: Features
- Universal, whole life and term life available
- Early payment options
- Very strong financials
Information support: Online information hub, quote tool, life planner
Customer support: Telephone, email support and social media
Interface: Browser and mobile app
State Farm offers the standard life insurance policies that most people need. Its whole life insurance protects your family’s future while building cash value that is tax-deferred, and premiums remain level for the life of the policy. Universal life offers flexible premium payments and death benefits. Term life insurance provides coverage for a specific time frame.
A nice feature is State Farm’s “Limited Pay Life Plans” for 10, 15 or 20 years, which let you pay completely for your life insurance premium in the term you choose, meaning you have nothing to pay during retirement.
State Farm coverage amounts start at $100,000, with $50,000 of life insurance available for people ages 16 to 45, lasting until age 50 or 10 years after the policy is issued. When it comes to whole life insurance, State Farm offers more policy discounts than many other insurers.
State Farm has a rating of A++ from A.M. Best, which is considered ‘superior’ and is the highest possible score. Financial strength is important, because it is effectively a measure of how easily insurance providers can pay claims, both now and - most likely - in the future.
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State Farm Life Insurance: Interface and usability
- Very good quote tool
- Nice life stage planner
- Website can be a bit confusing
State Farm insures everything - lives, homes, cars, businesses - and also offers banking services. As such, its website can be a little confusing to navigate. However, we did like its ‘life stage’ planner, which indicates what insurance policies and financial services you might need for different stages of your life, from young carefree adults to parents, retirees and so on.
It also features a very good life insurance calculator. Put in a few basic details and it will estimate how much life insurance you need to make sure your loved ones are protected.
State Farm offers a reasonable resources section, giving you basic and ‘beyond the basics’ life insurance information, but it is geared towards State Farm products and isn’t a comprehensive general resource like Northwestern Mutual’s information hub.
State Farm also offers a user-friendly mobile app - available for both Apple and Android - which lets you manage your policy on the go.
State Farm Life Insurance: Quality of product
- Second in the latest JP Power customer satisfaction ranking
- Fewer complaints than the average
State Farm knows the insurance landscape like nobody else. It is a generalist rather than a specialist, so its products tend to be focused on the mainstream rather than specialist requirements. But what it does it does well.
With life Insurance, that is best demonstrated by its all-but table topping JD Power survey rating of 808 out of 1,000, which is just two points below the score achieved by award-winner Northwestern Mutual. These two have been duking it out for top spot for a number of years. In 2018 State Farm took the top prize.
In 2019, State Farm took top marks (five out of five) in the ‘product offerings’, ‘interaction’, ‘communication’ and ‘overall satisfaction’ categories. It achieved four out of five in ‘price’ and ‘statements’. It was given a less impressive, though still above average, three out of five stars for ‘application and orientation’, which includes factors like the ease of the application process and the reasonableness of requests for documentation. This is one area that State Farm might aim to do better in.
State Farm occasionally attracts complaints, but this is inevitable given its size. Nevertheless, it attracts significantly fewer complaints than the median number directed to state regulators, according to the National Association of Insurance Commissioners.
State Farm Life Insurance: Verdict
State Farm is a very big provider offering big provider benefits, like a huge network of agents and excellent financial strength. Its life insurance policies are similar to those offered by other mainstream providers, but its early payment options are an attractive addition.
Aside from that, State Farm life insurance is well liked by customers and attracts only a small number of complaints, relative to the company’s size and coverage. We think its website could be a little more comprehensive, but its quote tool was among the best we’ve seen and and its stage of life planner was a useful touch. Add that financial might and it’s clear that State Farm is worthy of anyone’s consideration.
