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State Farm Homeowners Insurance

Reviewed
January 2011
by ConsumerSearch
State Farm Insurance

Best-of-the-biggest home insurance companies

Pros
  • High financial strength ratings
  • Good track record with  state insurance regulators
  • Available in all states but Mass. and R.I.
Cons
  • Some customer complaints about claims, service
Where to Buy
 

State Farm Homeowners Insurance covers more homeowners than any other insurance company in the U.S. -- so it may be a good alternative if you don't qualify for a top-rated policy from USAA (for military families only) or Amica Mutual. We found plenty of customer complaints against State Farm at websites like Viewpoints.com, and a trial lawyers' group says State Farm is one of the worst insurance companies for shortchanging or dumping policyholders who make a claim. But policy for policy, State Farm is actually found in the wrong less often than the national median when customers complain to state insurance regulators. State Farm gets average-to-good ratings in major customer surveys, and the Better Business Bureau gives it a B+ for handling complaints responsibly. Overall, although State Farm falls short compared to the very best, the company gets better feedback overall than Allstate and its subsidiaries or other mega-insurers.

J.D. Power and Associates and ConsumerReports.org conduct their own surveys of thousands of homeowners, ranking insurance companies (including State Farm) based on their feedback. The Better Business Bureau and the National Association of Insurance Commissioners collect official consumer complaints about State Farm. Viewpoints.com hosts customer commentary, although the unofficial reports posted there can be anonymous (and therefore possibly unreliable). State Farm makes the "Ten Worst Insurance Companies in America" list by the American Association for Justice, a trial lawyers' group.

Our Sources

1. J.D. Power and Associates

State Farm earns above-average scores for overall customer satisfaction in J.D. Power and Associates' latest survey, although clients say pricing is average for the level of coverage you get. J.D. Power ranks 27 home insurers based on a survey of more than 12,900 policyholders.

Review: 2010 National Homeowners Insurance Study, Editors of J.D. Power and Associates, Oct. 5, 2010

2. ConsumerReports.org

ConsumerReports.org ranks 16 home insurers (including State Farm), based on feedback from 10,700 homeowners. Policyholders rate each company for claims problems, delayed payments and too-small payments, culminating in an overall score.

Review: Homeowners Insurance Ratings, Editors of ConsumerReports.org, Sept. 2009

3. Better Business Bureau

State Farm's headquarters location gets a B+ from the Better Business Bureau, on a scale from A+ to F. The BBB has processed 944 complaints against this mammoth insurer in the past three years; all have been resolved or administratively closed, except for three that are still unresolved and two that have gotten no response from State Farm. You can also search for your local State Farm office here, to check its ratings with your local Better Business Bureau.

Review: BBB Reliability Report for State Farm Insurance Company, Editors of Better Business Bureau

4. National Association of Insurance Commissioners

State Farm had 545 complaints by homeowners policyholders upheld against it by state insurance regulators in 2009, the most recent year of data available. When adjusted for its size in NAIC's "complaint index" (State Farm insures 15 percent of homeowners nationwide, according to NAIC), this translates into less than half the national median for complaints.

Review: Consumer Information Source, Editors of National Association of Insurance Commissioners

5. Viewpoints.com

State Farm earns a high overall rating of 4.19 out of 5 stars here, with about 1,200 reviews posted. However, ratings run the gamut from 1 to 5 stars, and there is no way to tell whether the glowing (or scathing) reviews are true.

Review: State Farm Reviews, Contributors to Viewpoints.com

6. American Association for Justice

This trial lawyers' group ranks State Farm as the fourth-worst insurance company in America, based largely on court cases. AAJ says State Farm has shortchanged policyholders on claims, especially after disasters like Hurricane Katrina.

Review: The Ten Worst Insurance Companies in America, Editors of American Association for Justice

Homeowners Insurance Runners Up:

Chubb Homeowners Insurance

4 picks including: The New York Times, J.D. Power and Associates…

Allianz Homeowners Insurance

2 picks by top review sites.

Interinsurance Exchange of the Automobile Club Home Insurance

2 picks by top review sites.

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