State Farm Cutting Auto Rates, Hiking Home Premiums in Louisiana

State Farm has good news and bad news for Louisiana policyholders. It plans to cut car insurance rates and increase home insurance rates in the state, affecting more than 1,360,000 policyholders.

State Farm is the largest personal auto and homeowners insurer in Louisiana. Nearly 30% of the state’s personal auto market and more than 20% of the home insurance market have a policy with the insurer, according to the National Association of Insurance Commissioners.

More than 1,066,000 State Farm personal auto insurance policyholders will receive an average rate decrease of 5.9%, starting on Jan.1, 2026.

This rate decrease matches a statewide trend. Over 20 auto insurance companies filed more than 35 rate decreases in 2025, according to Louisiana Department of Insurance (LDI) rate filing records.

The slew of rate decreases may be related to a January 2025 winter storm that kept some Louisianans off the road for about a week, according to the Insurance Journal.

“We had an entire week where you didn’t have vehicles on the road,” Louisiana Insurance Commissioner Tim Temple told the publication. “When people stopped driving, just the frequency of accidents went down.”

Homeowners will see higher State Farm premiums in 2026

Though some auto insurance policyholders will see lower rates next year, State Farm’s home insurance customers will likely be paying higher premiums.

State Farm’s more than 300,000 home insurance customers are facing an average rate increase of 9.7%, which kicked in for renewed business on Dec. 15. State Farm filed for the home insurance rate increase in September, and the rate increase for new policies has been in place since Oct. 15.

Broken down by home insurance type, State Farm has increased basic premiums by 9.9% for homeowners, 2.3% for renters, and 6.3% for condominium owners, according to the company’s filing with the LDI.

State Farm’s hurricane modeling, which estimates higher losses in the years ahead, was the main driver for these average rate increases, according to an LDI press release. Higher non-catastrophe losses also contributed.

What’s next? Weather drives higher home insurance rates

Louisiana experiences the third-highest rate of hurricanes among U.S. states.

Hurricane Katrina, the state’s deadliest recorded storm in recent history, resulted in 1,200 deaths and $75 billion in property damage when it made landfall in Louisiana in 2005. In 2021, Hurricane Ida caused an estimated $84.6 billion in damages, per estimates from the National Centers for Environmental Information.

Like insurers in other high-risk states, Louisiana insurance companies respond to these risks by charging higher premiums, limiting the sale of certain coverage, or canceling some home insurance policies altogether.

Louisiana homeowners paid an average of $10,964 for a standard home insurance policy with $300,000 in dwelling coverage in 2024, according to Insurify data. This state average is second only to Florida and much higher than the 2024 national average of $3,259 per year for the same amount of home insurance coverage.

“Addressing the affordability of homeowners insurance in Louisiana will require continued commitment to improving the insurance marketplace, as well as a serious focus on strengthening the resilience of our homes and communities,” said Temple.