Updated July 23rd 2022
State Farm Whole Life Insurance Review
In this article, you will get a comprehensive State Farm whole life insurance review.
We will go over:
- Prices
- Ratings
- Finances
- Products
Since 1922, State Farm has been providing consumers with a variety of insurance products. Over the years, its whole life insurance policies have become known as some of the best that the industry has to offer.
However, is the popularity of their whole life insurance warranted?
Whole Life Insurance Products
All of the next whole life products have guaranteed coverage forever and guaranteed level premiums. The difference in the products is how long you have to pay:
Whole Life – Premiums paid until age 100.
Limited Pay 10 – Only pay premiums for 10 years. This is their best product for cash value accumulation.
Limited Pay 15 – Premiums for 15 years and be done.
Limited Pay 20 – Pay premiums for 20 years.
Single-Premium Life – Single Premium is usually used for estate planning or the transfer of wealth.
Final Expense – A final expense policy will provide your beneficiaries with a guaranteed death benefit of $10,000.
Riders
A rider is a feature you can add to a life insurance policy. Next we will list the available riders on a State Farm whole life policy.
Waiver of Premium for Disability
Guaranteed Insurability Option
Insured Year Term Riders
This rider gives you Term coverage for several years in addition to the whole life insurance. You can choose your term for 5 years, 10 years and 20 years. During the term, your premium will remain level. However, after that period, the term will go up in price.
The Good
Top Brand
As a consumer in the market for life insurance, you are sure to be more familiar with some brands than others. State Farm is a top brand in the insurance space, thanks to many years of providing high-quality products and services.
When it comes to financial ratings, you don’t have anything to worry about. State Farm is a top performer, as you can see by these ratings:
- A.M. Best Rating: A++
- BBB Rating: A+
- Standard & Poor’s Rating: AA
- Moody’s Rating: Aa1
- J.D. Power Rating: 4.2 out of 5
There are other companies with high ratings across the board, but State Farm is not outperformed by many. State Farm is currently number 42 in the Fortune 500 List: State Farm Fortune 500
Many Types of Coverage
Once you determine that whole life insurance is what you need, it won’t be long before realizing that State Farm has plenty to offer. Here is why:
- Flexible policy options, such as cash surrender.
- Variety of whole life insurance death benefits.
- No upfront fees.
Local Agents to Provide Assistance
With more than 19,000 agents scattered throughout the United States, there is always somebody nearby who can provide you with advice, quotes, and the guidance you require.
To go along with a large local network of agents, State Farm also has a strong reputation for providing high-quality customer service online and via phone.
The Not So Good
Price and Performance
Let’s get to the real problem. State Farm’s whole life insurance is costly compared to the competition. Let’s compare State Farm’s whole life insurance with multiple companies to see how they stack up.
On State Farm’s website, you will find an example for a:
Female, Age 25 for $100,000 of coverage.
| State Farm | $78.13 |
| Penn Mutual | 67.86 |
| MassMutual | 66.73 |
| Foresters | $66.50 |
State Farm ranks last often when we run comparisons in price. Not only is State Farm’s whole life more expensive, but also the cash value and the death benefit will not grow as fast as any of the previous companies listed.
All of the companies listed in the previous table have a lower price and a much higher dividend. See a whole life dividend history here: whole life dividend history
Fees
Although State Farm does not have the most advanced fees and charges, you need to be aware of them before purchasing. For example, the company assesses an expense risk and daily mortality charge that equals an annual rate of 0.8 percent of net assets.
While this is the industry standard, you may be able to find a company that charges a smaller fee.
Final Word
State Farm is a very reputable and stable company. However, when shopping for whole life insurance, we would not recommend State Farm Whole Life Insurance. Also, there are multiple better options that you should be aware of because you can get a lower price and better performance.
State Farm’s whole life insurance doesn’t make our Top 7 Whole Life Insurance Companies For Cash Value.
In conclusion, if you want car insurance to go to them, look elsewhere if you want whole life insurance.
Check out some of our other reviews: AllState, MetLife, MassMutual, Guardian and more…
