State Farm is increasing insurance rates on Illinois homeowners by 8% this fall. The increase is already effective for new policies, as of Oct. 1. Current customers will see their rates increase at renewal time, effective Dec. 1.
This rate hike is in addition to State Farm's 27% Illinois homeowner rate increase in 2025. It comes at a time when home insurance is becoming increasingly hard to get and more expensive across the nation.
The insurance industry is also facing increased government scrutiny. Gov. JB Pritzker signed legislation in August which allows the Illinois Department of Insurance to review and approve rate changes for both home and auto policies.
In a statement to WGLT, State Farm cited "the effects of severe weather trends that are more frequent and severe," as well as "related repair costs" which continue to rise, putting pressure on insurance profitability. It says the rate changes are necessary in order to continue paying claims in the future.
State Farm says it has "paid out $1.22 in claims and expenses for every $1 in premium collected the past three years in Illinois."
"Insurance costs are reviewed regularly because the factors that affect claims can change over time," State Farm said in the statement. "Homeowners rates reflect current expectations for repair and rebuilding costs, severe weather, labor, materials and other state-specific conditions. A prior decrease or improvement in one area does not determine the current expected cost of homeowners claims in Illinois."
State Farm also stated "We know insurance is an important part of every family's budget, and we understand that any change in cost matters. As a mutual company, State Farm serves policyholders on Main Street, not shareholders on Wall Street. We must focus on long-term financial strength to meet the needs of customers now and in the future."
