State Farm Starts $5 Billion Dividend Payout to Auto Insurance Customers

State Farm said its current $5 billion payout is the largest dividend in the company’s history.

Published: 8/18/2026, 5:37:41 PM EDT

State Farm Starts $5 Billion Dividend Payout to Auto Insurance Customers — A sign is posted in front of a State Farm insurance office in Berkeley, Calif., on Jan. 3, 2024. (Justin Sullivan/Getty Images)

State Farm Mutual has started distributing a $5 billion dividend to qualifying auto insurance customers after posting a sharp turnaround in its auto business in 2025. Millions of customers have already received payments as distribution takes place nationwide.

“This dividend is a one-time cash payment to qualifying customers. This dividend is possible due to State Farm Mutual’s financial strength and a stronger-than-expected underwriting performance in 2025,” according to State Farm.

The one-time payment applies to eligible policies covering more than 49 million vehicles. State Farm estimates the average dividend will be about $100 per vehicle, though amounts will vary by state and premiums paid.

“Qualifying customers will be notified of their pending dividend payment beginning late summer of 2026. Payments are being sent in waves by state, based on where the policy is assigned,” according to the insurer.

Customers qualify if they had an active State Farm Mutual personal auto policy at any time in 2025 and their payment totals at least $10, the insurer said. Former customers also are eligible, and each qualifying policy receives a separate payment.

Payments equal 4 percent to 10 percent of the premiums paid on qualifying policies in 2025. State Farm said the percentage varies by state, based on each state’s contribution to the company’s nationwide auto insurance results.

The payout follows a major improvement in State Farm’s auto insurance business. State Farm’s auto insurance business reported a $4.6 billion underwriting gain in 2025, reversing a $2.7 billion loss in 2024. Earned premiums rose to $71.3 billion, while claims and related expenses fell to $52.6 billion.

The dividend also comes as the broader auto insurance industry reports improved financial results.

“The U.S. personal auto insurance market achieved its strongest underwriting performance of the post-pandemic era in 2025, recording a net combined ratio of 91.8,” according to a June report from the Insurance Information Institute.

A combined ratio below 100 means insurers collected more in premiums than they paid out in claims and related expenses.

The improvement follows years of rising costs for drivers. The federal motor vehicle insurance price index fell 4.5 percent in the 12 months ending in July 2026, including declines in June and July, according to the Bureau of Labor Statistics.

Auto insurers have previously issued significant refunds to drivers, most notably during the COVID-19 pandemic, when a drop in driving led to fewer claims.

State Farm returned as much as $2 billion to auto policyholders in 2020 and issued a separate $400 million dividend to California customers in 2021. Allstate also refunded nearly $1 billion to drivers during the pandemic.

Last year, Progressive announced nearly $1 billion in refunds for Florida auto policyholders after improved results under the state’s insurance profit-control law. That payout is also legally mandated by the state.

State Farm said its current $5 billion payout is the largest dividend in the company’s history.

State Farm said customers with an email address on file will “receive an email with instructions from Veritas to log into a payment portal and choose digital payment or check.”

“Customers who do not have an email address on file with State Farm will automatically receive a check in the mail,” the insurer said. State Farm also said customers can call 1-888-808-9532 or visit sfdividend.com for more information about state-specific dates.