State Farm is distributing a record $5 billion dividend to eligible auto insurance policyholders, marking the largest cash payout in the company’s more than 100-year history.
The payments will be distributed over the coming months and will cover more than 49 million vehicles. But not every State Farm customer qualifies for the payout.
Who is eligible for the State Farm dividend?
The dividend is available to customers who held a qualifying State Farm auto insurance policy during 2025 and whose calculated dividend is at least $10.
Importantly, you do not need to be a current State Farm customer to receive the payment. Former policyholders can also qualify if they had an eligible policy during 2025.
How much will eligible customers receive?
State Farm says the average payment is about $100 per vehicle, although the actual amount will vary.
For each qualifying vehicle, the dividend will generally equal between 4 per cent and 10 per cent of the premium paid during 2025.
The amount can differ depending on the state where the policy was held and the premiums paid.
Some eligible customers could therefore receive more than one payment if they had multiple qualifying vehicles.
When will State Farm send the money?
State Farm is notifying eligible policyholders in batches based on location.
Customers who have an email address on file will receive notification with instructions for accessing an online payment portal. They can choose an electronic payment or request a cheque.
Customers without a current email address will receive their dividend automatically by mail.
Because payments are being distributed in batches, State Farm says it could take several months for all eligible policyholders to receive their money.
Only direct payments will be issued. The dividend will not be applied as a credit towards a current insurance policy.
Will the dividend reduce future insurance premiums?
No. State Farm says the dividend will not affect customers’ future auto insurance rates.
The company said current premiums are calculated based on expected future costs, while the dividend is based on State Farm’s 2025 financial results.
Do homeowners and renters qualify?
No. The record dividend currently applies only to qualifying auto insurance policyholders.
State Farm manages its different insurance businesses separately, meaning customers with only homeowners, renters or life insurance policies are not eligible for this particular payout.
Why is State Farm paying a dividend?
State Farm is a mutual insurance company, meaning its policyholders are members rather than customers of a company owned by outside stockholders.
Unlike publicly traded insurers, mutual companies do not have external shareholders. When financial performance allows, they can return part of their surplus to eligible members through dividends.
State Farm’s $5 billion payout therefore represents a return of part of its financial success to qualifying auto policyholders.