State Farm® announces 2021 financial results

Bloomington, IL, February 25, 2022 – In 2021, State Farm Insurance Companies experienced record growth in auto, home and life policies. While experiencing record growth in auto policies, State Farm reported another year-over-year decrease in auto earned premium. The decrease in auto premium continues to reflect a focus on returning value to customers in the form of lower premiums when appropriate. The State Farm life insurance companies paid out nearly $600 million in dividends to policyholders, and issued a record $116 billion in new policy volume bringing the year-end 2021 individual life insurance in force to $1.1 trillion. As the number one Auto and Homeowners insurer in the U.S. and a leader in individual life insurance, State Farm is committed to serving its policyholders and remains a strong choice for insurance and financial services needs. 

“For nearly 100 years, State Farm has been there to help our customers prepare for and recover from the unexpected. This past year was no different. We helped customers recover from another year of catastrophic events and the life insurance companies continued to be there for our customers,” said Senior Vice President, Treasurer and Chief Financial Officer Jon Farney. “We entered our 100th year with financial strength and record growth in our auto, home and life insurance businesses. We are pleased more customers are choosing State Farm as we remain focused on helping more people in more ways.” 

The State Farm P-C group of companies reported earned premium of $66.9 billion, a combined underwriting loss of $4.7 billion, and paid $401 million in dividends to State Farm Mutual Automobile Insurance Company policyholders. This result compared to an underwriting gain of $1.9 billion on earned premium of $65.1 billion in 2020, along with $1.9 billion in dividends to State Farm Mutual Automobile Insurance Company policyholders. The 2021 underwriting results reflect higher auto lines incurred claims and lower premiums. Homeowners underwriting results reflect another year of significant catastrophe activity across the country. The 2021 underwriting loss, combined with dividends to policyholders, and investment and other income of $4.4 billion, resulted in a P-C pre-tax operating loss of $301 million, which was down from $4.5 billion profit reported in 2020. Total revenue, which includes premium revenue, earned investment income and realized capital gains (losses) was $82.2 billion for 2021 compared to $78.9 billion for 2020. State Farm reported net income of $1.3 billion in 2021 compared to $3.7 billion of net income in 2020. The net worth for State Farm Mutual Automobile Insurance Company ended the year at $143.2 billion compared with $126.1 billion at year-end 2020. The change includes a significant increase in the value of the P-C companies’ unaffiliated stock portfolio, driven by increases in the U.S. equities market. 

The State Farm Insurance operations consist of thirteen P-C companies and two life companies, each of which is managed on an individual affiliate level. The P-C companies are primarily engaged in automobile, health, homeowners, commercial multiple peril (CMP) and reinsurance lines of business. The life companies are primarily engaged in individual life insurance and annuity business. The State Farm group makes third party mutual funds and third party banking products available through affiliated 2 State Farm companies that act as intermediaries between the third parties and State Farm customers. State Farm provides insurance and financial services products across over 87 million policies and accounts. 

Auto – The State Farm auto insurance business represented 61 percent of the P-C companies’ combined net written premium. Earned premium was $41.2 billion. Incurred claims and loss adjustment expenses were $34.4 billion and all other underwriting expenses totaled $10.2 billion. The underwriting loss was $3.4 billion and dividends to State Farm Mutual Automobile Insurance Company policyholders totaled $401 million. 

Comparable 2020 figures were: earned premium, $41.3 billion; incurred claims and loss adjustment expenses, $27.6 billion; all other underwriting expenses, $10.1 billion; underwriting gain, $3.5 billion; dividends to State Farm Mutual Automobile Insurance Company policyholders of $1.9 billion. 

Homeowners, CMP, Other – The net written premium for the remainder of the State Farm P-C business represented 38 percent of the P-C companies’ combined net written premium. Earned premium was $24.7 billion. Incurred claims and loss adjustment expenses were $19.5 billion and all other underwriting expenses totaled $6.3 billion. The underwriting loss was $1.1 billion. 

Comparable 2020 figures were: earned premium, $22.9 billion; incurred claims and loss adjustment expenses, $18.6 billion; all other underwriting expenses, $5.9 billion; underwriting loss, $1.6 billion. 

Health – The individual health insurance operations for State Farm Mutual Automobile Insurance Company reported an underwriting loss of $75 million, excluding the change in the premium deficiency reserve. Net written premium was $719 million. 

 Comparable figures for 2020 were: underwriting loss, $24 million; net written premium, $710 million. 

Life – In 2021, State Farm Life Insurance Company and State Farm Life and Accident Assurance Company reported premium income of $5.7 billion and $593 million in dividends to policyholders. Net income for 2021 was $929 million. There was $1.1 trillion in individual life insurance in force at the end of 2021. Comparable 2020 figures were: premium income, $5.5 billion; dividends to policyholders, $584 million; net income, $339 million; individual life insurance in force, $994 billion. 

Investment Planning Services – Total assets under management for the Investment Planning Services operation at the end of 2021 were $15.3 billion. State Farm VP Management Corp. and State Farm Investment Management Corp. reported a combined net loss of $38 million in 2021. Comparable figures for 2020 were: total assets under management, $13.9 billion; net loss, $41 million. 

GAINSCO, Inc. – In 2021, total revenue was $327 million, net loss was $8 million and total assets totaled $405 million. Comparable 2020 figures were: total revenue, $335 million; net income, $5 million; total assets, $421 million. 

Although financial information is presented on a group/line of business basis, State Farm Mutual Automobile Insurance Company and each of its affiliates must meet solvency and regulatory requirements on an individual entity-by-entity basis without regard to the solvency or financial condition of any other affiliated entity. 

 Securities distributed by State Farm VP Management Corp. 

State Farm VP Management Corp. is a separate entity from those State Farm entities which provide banking and insurance products. Neither State Farm nor its agents provide investment, tax, or legal advice.