State Farm announced Thursday that it will return $5 billion to qualifying auto insurance customers through a one-time dividend payment, with distributions scheduled to begin this summer.

The company said the dividend will average roughly $100 per insured vehicle, though actual amounts will vary by state and by the premiums paid. Policyholders are not required to take action to receive the funds. Customers may either receive a mailed check or an email prompting them to claim payment digitally. The company clarified that the dividend will not be issued as a premium credit.

State Farm tied the payout to what it described as strong financial performance in 2025, along with recent auto rate reductions in 40 states that it said are saving customers approximately $4.6 billion annually in lower premiums. According to the insurer, easing auto repair costs and declining collision frequency contributed to improved underwriting results.

In its 2025 financial report, State Farm posted total revenue of $132.3 billion, up from $123.0 billion in 2024. Net income rose to $12.9 billion from $5.3 billion the prior year. The company reported an auto underwriting gain of $4.6 billion in 2025, compared to a $2.7 billion underwriting loss in 2024.

Auto insurers in recent years have raised rates amid inflation, higher repair expenses, and increased claim severity, drawing scrutiny from regulators and consumers. Some firms have since moved to stabilize pricing as claims trends improved.

USAA said in December that it returned approximately $3.7 billion to members in 2025 and anticipated continued rate stabilization into 2026, noting that pricing can vary by state and individual driving records.