State Farm's headquarters are in Bloomington, Illinois. (Credit: Ivo Shandor)
State Farm wants to raise its rates for homeowners in Illinois by nearly 30%.
According to a filing with the state, State Farm is planning to increase its homeowners insurance rates by 27.2% starting Aug. 15. The rate hike will be one of the largest in the state’s history, and it will impact nearly 1.5 million existing policyholders. The rate hike will be applied to new policyholders starting July 15.
State Farm says the rate hike is necessary to keep up with losses from severe weather events in Illinois.
“Over the last several years, our catastrophe provision has proven to be inadequate when compared to our actual catastrophe loss experience,” State Farm said in the filing.
State Farm says its catastrophe losses have surpassed its catastrophe provision in 13 of the last 15 years, “signaling the provision used in rating has been insufficient in recent history.”
On average, Illinois sees about 17 tornadoes each year, 60 to 80 severe thunderstorms and an average of five severe winter storms annually.
Costly weather events in the state are increasing. According to the National Oceanic and Atmospheric Administration, the state saw 128 weather disasters costing $1 billion or more between 1980 and 2024. While the state saw an annual average of 2.8 events exceeding $1 billion between 1980 and 2024, that average increased in the most recent five years (2020-2024) to 7.8 events each year.
Earlier this year, Allstate raised its homeowners insurance rates by 14.3% for its 248,000 Illinois customers.
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