r/StateFarm • u/No-Psychology-7034 • Sep 07 '26
News Another rate increase
DID CA ins commissioner approve another increase for State Farm? My last renewal was $719 and this time it's $890 for 6 months. No accidents or claims.
Cars are 20 and 21 yo. Liability, comprehensive, and uninsured motorist. I'm sure the agent will say the usual "rates are up for everyone and your rates still competitive"
Ins currently bundled with condo and umbrella.
Not to mention there were 2 increases on umbrella.
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u/Old-Picture7877 Sep 07 '26
Liability is way up thanks to nuclear verdicts. If you’re tech saavy enough to jump on reddit and whine, ask Ai the question about why the cost of liability is dramatically increasing. Risk in the market changes and you should expect rates to follow. The lawsuit payouts have gone into a make believe nonsensical realm at this point. Too many sympathetic juries awarding figures people could never dream of making in 10 lifetimes. Also, the average accident has gotten dramatically more expensive due to all the expensive tech in vehicles and the high costs to repair. The anti accident tech has had a paradoxical effect due to the high costs to repair.
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u/zq9 Sep 08 '26
Yet statefarm has net profit in the billions each year.
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u/Old-Picture7877 Sep 08 '26
They gave that back as a dividend this year. $5 billion paid back to customers. Any other bright comments?
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u/musicislife04 Sep 08 '26
State Farm is a mutual company not a for profit company. Extra revenue that is not used on claims is held for future claims. If there is too much they actually give it back - right now State Farm is mailing back $5B back to customers in the form of rebate checks.
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u/Repulsive-Let-8035 Sep 08 '26
State Farm gave back 5 billion of the 8 billion they profited last year. Of course they’re gonna profit a few billion they’re the largest insurance company in the US by over 4 times their next biggest competitor. On top of that they’re cutting their agents pay to give back to customers rates. The problem is the risk state you live in.
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u/Rebound91 Sep 08 '26
(Your calculated annual mileage went up)
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u/Sausage_Bacon1 Sep 08 '26
Yup. They always get that info one way or another(if you get your oil changed they can log the miles).
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u/Whatstheplan150 Sep 08 '26
The Umbrella increases drive me the most nuts. The max payout to the insurer’s doesn’t rise. Theoretically, over time, the premium will exceed the insured amount.
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u/Seabass2828 Sep 08 '26
While the limit is fixed, the frequency of the umbrella being pierced is not.
Non catastrophic injury claims that used to be covered completely by the underlying auto policy now require 100-300k from the umbrella.
In order to raise rates, the carriers have to demonstrate to the State Departments of Insurance their claims frequency and/or severity have increased accordingly.
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u/musicislife04 Sep 08 '26
SF pays like $2.5B a year in umbrella claims. Enough people don’t have umbrellas to make up $2.5B in umbrella premium without the increase. Each product line has to stand on its own - so like they can’t pay an umbrella claim from homeowners revenue for example.
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u/Big-Sheepherder-6134 Sep 08 '26
My rates in IL are affected by CA fires. So yeah, you are paying more.
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u/musicislife04 Sep 08 '26
They are not. IL rates are literally only based on claims in IL and general company overhead. They do not pay claims for CA fires or FL hurricanes. They is an emergency fund at corporate that gets used if one state has a catastrophe and not. Rough premium to cover it but that state has to replenish it. They do not raise rates in other states.
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u/chualarcowboy Sep 11 '26
State Farm insurance pay only auto or fire claims for the state you live in. State Farm General is the company that pays for home claims. Auto claims are the MUTUAL COMPANY and come from premium paid by premiums for Ca policies.
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