Personal Finance

State Farm Life Insurance Review 2020

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AT A GLANCE

  • Rated 4.5 stars out of 5 by NerdWallet.
  • Ranked first for customer satisfaction in J.D. Power life insurance study.
  • Drew fewer life insurance complaints to state regulators than expected for a company of its size.

Shopping for life insurance during the pandemic? Be aware that insurers may have changed their products and policy applications. For the latest information on how to cope with financial stress during this emergency, see NerdWallet’s financial guide to COVID-19.

Started in 1922 by an Illinois farmer, State Farm is best known for its home and auto insurance. But the company also sells a broad range of life insurance products, primarily through local agents. Although its reach is wide, the company doesn’t issue life insurance in Massachusetts.

State Farm life insurance

4.5 NerdWallet rating

State Farm life insurance earned 4.5 stars out of 5 for overall performance. NerdWallet’s ratings are determined by our editorial team. The scoring formula takes into account complaint data from the National Association of Insurance Commissioners and financial strength ratings from A.M. Best.

Based on these ratings, State Farm is among NerdWallet’s best life insurance companies for 2020.

State Farm life insurance policies

State Farm sells term life, whole life and universal life insurance policies to individuals. All of State Farm’s term products can be converted to permanent coverage, regardless of changes to your health. Availability and policy details vary among states.

Term life insurance

Select Term Life Insurance: Policies are available in 10-, 20- or 30-year terms, depending on your age, and renewable up to 95. Coverage amounts start at $100,000.

Instant Answer Term Life: $50,000 of coverage is available for people between 16 and 45, lasting until age 50 or 10 years after the policy is issued, whichever is later. State Farm’s instant answer life insurance doesn’t require a medical exam. However, you have to complete a health questionnaire, and your answers may disqualify you from coverage.

Return of Premium Term Life: Coverage starts at $100,000 and is available in 20- or 30-year terms, though you can renew the policy at increased rates. If you pay premiums faithfully, outlive your term and don’t renew, you’ll get your money back.

Permanent life insurance

Whole life insurance policies include standard whole life, limited-pay whole life, single-premium whole life and final expense. The company’s standard whole life policy has level premiums. Its limited-pay and single-premium policies allow you to adjust how and when you pay for the coverage. Final expense policies, available to applicants 50 to 80 years old (50 to 75 in New York), come with $10,000 of coverage.

Universal life insurance options include survivorship and joint universal policies. These types of policies cover two individuals, typically spouses. The company’s standard universal policy offers flexible coverage and payment options.

» MORE: Compare life insurance quotes

State Farm customer complaints and satisfaction

Over three years, State Farm has drawn fewer complaints to state regulators than expected for a company of its size for life insurance, according to a NerdWallet analysis of data from the National Association of Insurance Commissioners.

State Farm ranked first out of 23 companies in J.D. Power’s 2020 U.S. Life Insurance Study for overall customer satisfaction.

More about State Farm life insurance

You can search for a local State Farm agent on the company’s website and apply for certain term products online. All policies are eligible for dividends, but universal and term products aren’t expected to earn them.

The online portal allows you to view your policy, pay premiums and see lab results. However, it doesn’t support document downloads for Android smartphones.

Other State Farm insurance products include:

State Farm life insurance pros and cons

Methodology: Life insurance ratings

NerdWallet’s life insurance ratings are based on weighted averages of complaint index scores from the National Association of Insurance Commissioners for individual life insurance, and financial strength ratings from A.M. Best, which indicate a company’s ability to pay future claims. To calculate each insurer’s rating, we adjusted the NAIC and A.M. Best scores to a curved 5-point scale.

These ratings are a guide, but we encourage you to shop around and compare several insurance quotes to find the best rate for you. NerdWallet does not receive compensation for any reviews.

Methodology: Insurer complaints

NerdWallet examined complaints received by state insurance regulators and reported to the National Association of Insurance Commissioners in 2016-2018. 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. Ratios are determined separately for auto, home (including renters and condo) and life insurance.

This article originally appeared on NerdWallet