American Family Insurance vs State Farm

Verdict

American Family Insurance and State Farm are both policyholder-owned groups that sell through exclusive agents who represent only their company. State Farm is the nation's largest home insurer (#1 for 2025 homeowners premiums, $35.27 billion, 18.67% of the market, per NAIC data); American Family ranks #6 ($9.72 billion, 5.14%). The footprint is the first filter. American Family-branded homeowners policies are sold in 19 states, across the Midwest and West plus Georgia and Ohio. Elsewhere its group appears through Homesite and partner programs, with different forms and claims handling. State Farm writes through agents in nearly every state, with limits on new business in California and Massachusetts.

Inside the shared states, the roof is the coverage difference to read. American Family's roof page says the policy pays a roof at actual cash value, meaning depreciated value, and that replacement cost for windstorm and hail damage is an added extra if the roof qualifies by age and type. Say a 12-year-old roof would cost $18,000 to replace: under actual cash value, depreciation could leave you covering a large share beyond the deductible. State Farm writes on its own forms, not ISO's HO 00 03, and we did not find roof settlement terms on its coverage pages, so ask for them in writing. American Family also sells a flash flood endorsement (it is not NFIP flood and does not satisfy a lender) and adds Wildfire Defense Services at no charge in Arizona, Colorado, Nevada, Oregon and Washington.

Ratings and pricing pressure are the other points. AM Best affirmed American Family at A (Excellent) on September 24, 2025. State Farm's main companies are A+ (Superior), cut from A++ in November 2025, though State Farm General in California is B (Fair). Both have pushed rates up: S&P Global reported a 16.5% average effective change for American Family on owner-occupied filings approved in 2024, and State Farm raised Illinois rates an average 27.2% in 2025 with a further filing of nearly 8% in 2026.

Choose American Family if

• You live in one of its 19 agent states, especially Wisconsin (where it is the largest home insurer) or Minnesota, Missouri and Kansas (where it is second).
• You want a diminishing deductible: $100 credited at the start and at each renewal, up to $1,000, reset after a claim (not offered in Minnesota).
• You want a flash flood endorsement of $25,000, $50,000 or $100,000, or free wildfire defense services in the five Western states.
• You will pay for wind and hail replacement cost on the roof, if your roof qualifies by age and type.

Choose State Farm if

• You live outside American Family's 19 states, and want an agent in town.
• You are shopping on roof terms and want a second quote to set against American Family's actual-cash-value default.
• You value the larger group and its A+ (Superior) AM Best rating, and can check which State Farm company issues your policy.
• You qualify for its credits: Class 4 impact-resistant shingles (26 states), wind mitigation, or wildfire mitigation in California, Colorado and Oregon.

Key differences

Before you decide

Get identical Coverage A, deductibles and endorsements from both, and ask each agent for the roof settlement terms as written. Ask whether either writes new business at your address. Roof payment schedules and ACV roof endorsements explains why the roof endorsement moves your out-of-pocket cost more than most other choices. how to compare homeowners insurance quotes and captive agents, independent agents and direct insurers help with the comparison, and bundling home and auto insurance: when it pays covers whether the combined discount is worth tying your auto policy to the same carrier.