State Farm to issue $136M to Louisiana policyholders

(The Center Square) – Eligible State Farm auto insurance customers in Louisiana will begin receiving dividend payments this week as the nation's largest auto insurer returns a portion of stronger-than-expected underwriting results to policyholders.

According to a release, State Farm Mutual Automobile Insurance Company told the Louisiana Department of Insurance it expects to pay about $136 million to qualifying Louisiana policyholders. The average payment will be $138 per eligible vehicle.

The dividends apply to customers who had a State Farm Mutual Private Passenger Auto Voluntary Preferred policy in force as of Dec. 31, 2025.

Insurance Commissioner Tim Temple said the payments illustrate how policyholders can benefit when insurers collect more in premiums than expected while paying fewer claims.

"Insurance companies base their rates on projections of how much they will collect in premiums and how much they will pay out in claims," Temple said in a statement. "When an insurance company takes in more money than anticipated and pays out less in claims, whether due to national trends, state-level reforms, or both, policyholders should benefit directly through lower premiums."

Temple also pointed to broader changes in Louisiana's auto insurance market, saying private passenger auto insurers filed more than 45 rate decreases during 2025 and 2026. According to the department, those filings are expected to reduce premiums paid by policyholders by about $384 million over their next policy terms.

Temple credited recent legislative changes championed by Gov. Jeff Landry, the Legislature and the Department of Insurance with helping reduce insurance costs. He cited reforms to Louisiana's comparative fault law, repeal of the state's direct action statute, limits on third-party litigation financing, changes to the Housley presumption, increased transparency for medical billing in litigation and stronger distracted driving laws.

State Farm said eligible customers with an email address on file will receive an email between early August and early September asking them to choose a payment method. Customers without an email address on file will receive paper checks by mail.