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State Farm to divvy up $1 billion in dividends

State Farm Mutual Automobile Insurance Co. policyholders will be receiving a payback from their insurer to the tune of $1 billion.

The average dividend on each insured vehicle will be about $29.

Policyholders in 49 states (with the exception of New Jersey), the District of Columbia, and the Canadian provinces of Alberta, New Brunswick, and Ontario, will receive a share of $1,005,500,000 in dividend payments from the Bloomington, Ill.-based insurer. The average dividend on each insured vehicle will be about $29.

Prior to this year's dividend, the highest dividend State Farm ever paid to policyholders was $892 million in 1998. Since 1991, State Farm has paid a total of $3.3 billion to policyholders in the form of seven annual dividends. The company did not pay out dividends in 1995, 1996, or 1999.

Dick Luedke, a spokesperson for the insurer, explains that State Farm — which is a mutual company owned by policyholders — only pays dividends when its financial results "are more favorable than we anticipated."

Luedke says the amount each policyholder will receive varies from state to state, but each policyholder receives 20 percent of the first $75 of his or her annual premium (or $15). After that, a policyholder may or may not receive a percentage of the remaining premium. The percentage ranges from zero to 20 percent, and varies according to State Farm's financial performance in that state, which is reflected by written premiums and claim payouts, among other factors.

Most policyholders will receive their dividend by check during the six-month policy renewal cycle, which began on June 12. About 2 percent of all policyholders will receive dividends of less than $10. Those policyholders will have the money credited to their insurance bill.

New Jersey policyholders are not eligible for this dividend because they are insured by a different company, State Farm Indemnity, which did not pay dividends to policyholders this year.

State Farm 2000 dividend to be paid out

State
Number of vehicles insured
Dollar amount in dividends available in the state
Average dividend per vehicle
Alabama
721,895
$39.6 million
$55
Alaska
101,015
$1.5 million
$15
Arizona
532,238
$7.9 million
$15
Arkansas
445,425
$6.7 million
$15
California
2.8 million
$182.6 million
$65
Colorado
776,735
$11.6 million
$15
Connecticut
43,340
$3.6 million
$82
Delaware
127,332
$9.5 million
$75
District of Columbia
40,694
$3.3 million
$80
Florida
2.2 million
$100.3 million
$45
Georgia
1.4 million
$28.1 million
$21
Hawaii
115,704
$8.7 million
$75
Idaho
172,538
$2.5 million
$15
Illinois
2.3 million
$34.3 million
$15
Indiana
957,658
$14.2 million
$15
Iowa
452,898
$6.6 million
$15
Kansas
460,572
$22.1 million
$48
Kentucky
516,174
$12.7 million
$25
Louisiana
894,154
$31.5 million
$35
Maine
114,242
$1.7 million
$15
Maryland
686,712
$45.8 million
$67
Massachusetts
13,831
$600,000
$46
Michigan
1.3 million
$18.5 million
$15
Minnesota
916,576
$13.4 million
$15
Mississippi
431,919
$6.5 million
$15
Missouri
929,721
$13.8 million
$15
Montana
170,480
$2.5 million
$15
Nebraska
347,205
$5 million
$15
Nevada
202,503
$3 million
$15
New Hampshire
99,120
$5.8 million
$59
New Mexico
257,642
$16.4 million
$64
New York
1.1 million
$16.5 million
$15
North Carolina
884,077
$13.2 million
$15
North Dakota
87,176
$3.7 million
$42
Ohio
1.6 million
$46.1 million
$29
Oklahoma
510,076
$7.5 million
$15
Oregon
567,058
$9.4 million
$17
Pennsylvania
1.6 million
$23.3 million
$15
Rhode Island
5,065
$300,000
$64
South Carolina
801,789
$19.2 million
$24
South Dakota
110,706
$1.6 million
$15
Tennessee
887,311
$13.3 million
$15
Texas
2.9 million
$88 million
$31
Utah
296,848
$13.7 million
$46
Vermont
42,199
$600,000
$15
Virginia
958,040
$14.3 million
$15
Washington
621,644
$37.6 million
$60
West Virginia
393,761
$5.9 million
$15
Wisconsin
492,471
$13.5 million
$27
Wyoming
116,730
$1.9 million
$16
Alberta
59,199
$1.3 million
$22
New Brunswick
26,119
$600,000
$22
Ontario
639,119
$13.7 million
$22

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