State Farm Raises Illinois Homeowners’ Insurance Rates by 27.2%: In a move that will affect nearly 1.49 million homeowners across Illinois, State Farm, the nation’s largest home insurer, has announced a substantial 27.2% average increase in homeowners’ insurance rates. This sharp rate hike, approved by state regulators, is set to go into effect by mid-July 2025 and is expected to generate an additional $522.8 million in annual premiums. The company cited a significant rise in catastrophic weather events and long-term loss trends as the main reasons behind this decision.
According to the regulatory filing, some policyholders may see increases as high as 39.9%, depending on their specific plan and location within Illinois. The hike is primarily aimed at those under the independent homeowners program, which encompasses most of State Farm’s property insurance policies in the state. Illinois has faced repeated losses due to storms, hail, and other natural disasters. In fact, catastrophe losses exceeded expectations in 13 of the past 15 years, demonstrating the severity of weather-related damage in the region.
This move is part of a broader trend where insurance companies across the U.S. are adjusting rates to reflect growing risks from climate change, rebuilding costs, and reinsurance pressures. State Farm emphasized that the rate changes are crucial to align pricing with projected risk while still remaining competitive in the market. In addition to raising premiums, State Farm will also implement a new minimum 1% wind/hail deductible, though other deductibles will remain unchanged.
Who Can Apply for State Farm Homeowners Insurance?
State Farm’s homeowners insurance policies are available to:
- Illinois residents who own a home (single-family, duplex, condo, or townhouse).
- New homeowners seeking their first insurance policy.
- Existing policyholders looking to renew or modify their coverage.
- Individuals who meet State Farm’s underwriting criteria, which may include location, property value, previous claim history, and credit profile.
Even with rate increases, State Farm continues to offer extensive coverage options, customizable plans, and nationwide service reliability, making it a viable option for homeowners in Illinois.
State Farm Homeowners Insurance Fees & Premium Structure
As of July 2025, the new average rate increase is 27.2%, but here’s a breakdown of what that means:
| Type of Cost | Previous Average | New Average (Post-Hike) |
|---|---|---|
| Annual Premium (est.) | $1,920 | ~$2,443 |
| Monthly Premium (est.) | $160 | ~$203.58 |
| Wind/Hail Deductible | None | 1% of home’s insured value |
| Other Deductibles | Unchanged | Unchanged |
How to Use State Farm Homeowners Insurance & Benefits
State Farm’s homeowners insurance can be used to cover the cost of rebuilding or repairing your home and personal property after events like:
- Storms, hail, wind damage
- Fires
- Theft and vandalism
- Liability claims (e.g., if someone gets injured on your property)
Benefits:
- Customizable Coverage: Tailor your plan with riders for valuables, identity restoration, and more.
- Bundle Discounts: Combine with auto or life insurance for multi-policy discounts.
- 24/7 Claims Service: Fast online or app-based claims with round-the-clock support.
- Risk Mitigation Tools: Access to loss prevention tools and programs to minimize damage.
How to Apply for State Farm Homeowners Insurance
Applying is straightforward and can be done both online and offline.
Steps to Apply:
- Visit State Farm’s Official Website or local agent office.
- Use the Homeowners Insurance Quote Tool to get a custom quote.
- Provide Details: Home location, construction type, age of the home, previous claims, and coverage needs.
- Review suggested policy and choose add-ons or adjust deductibles.
- Submit required documents (ID, property details, prior insurance history).
- Make payment and receive your digital or physical insurance documents.
Alternate Methods:
- Call Customer Support: 800-STATE-FARM
- Visit a Local Agent: Over 19,000 agents nationwide.
- State Farm Mobile App: Easy to get quotes and manage policies. Get a Quote Online (State Farm)
Important Dates
| Event | Date |
|---|---|
| Regulatory Approval Granted | June 2025 |
| Rate Increase Effective Date | Mid-July 2025 |
| New Wind/Hail Deductible Applied | Mid-July 2025 |
| Renewal Policies Impacted From | August 2025 onward |
Disclaimer
This article is for informational purposes only. Premium rates, deductibles, and eligibility requirements are subject to change and may vary by location and underwriting standards. Please consult a licensed State Farm agent or visit their official website for the most accurate and personalized information.
Also read: Global Economic Slowdown Triggered by US Tariffs: Impact on Insurance Industry
State Farm Raises Illinois Homeowners’ Insurance Rates by 27.2%
Conclusion
The 27.2% homeowners’ insurance rate increase by State Farm in Illinois reflects a broader shift in the insurance industry due to rising natural disasters and rebuilding costs. While the spike may burden many policyholders, it underscores the increasing unpredictability of extreme weather and the need for stronger financial preparedness.
For existing policyholders, it’s crucial to review your coverage, understand new deductibles, and explore bundling or safety discounts that could offset the cost. New applicants should carefully consider all coverage options and get personalized quotes.
As insurance pricing becomes more volatile, being proactive about understanding your policy and risk profile is key. Take advantage of State Farm’s digital tools, local agent support, and online quote calculators to make informed decisions.
Whether you’re protecting your forever home or your first property investment, aligning your homeowners’ insurance with today’s risks is essential. And with proper planning, you can still find value in what State Farm offers—despite the rate increases.
State Farm Raises Illinois Homeowners’ Insurance Rates by 27.2%
FAQs
1. Why is State Farm increasing homeowners’ insurance rates in Illinois?
State Farm is raising rates due to an increase in catastrophic weather events and higher claim costs. From 2012 to 2022, Illinois ranked fifth-worst in combined homeowner coverage losses. The company said their catastrophe provisions were exceeded in 13 of the past 15 years, prompting the hike.
2. When will the new rate increase take effect?
The new rate increase will go into effect in mid-July 2025, following approval from Illinois regulators. Policies renewed after this date will reflect the updated premium.
3. How much more will I pay after the increase?
On average, homeowners will see a 27.2% increase, which could mean paying around $523 more annually. The maximum increase is 39.9%, depending on your home’s location and other risk factors.
4. What is the new wind/hail deductible being introduced?
A new minimum wind/hail deductible of 1% will be applied starting mid-July. This means if your home is insured for $300,000, you’ll need to pay at least $3,000 out-of-pocket before insurance kicks in for wind/hail-related claims.
5. Can I reduce my premium despite the rate hike?
Yes. You can bundle policies, improve your home’s risk profile (like installing storm-resistant roofs), increase deductibles, or participate in loss prevention programs to lower costs. Contacting a local State Farm agent for personalized discounts is also recommended.
