State Farm to Give $1 Billion to Policyholders

State Farm Mutual Automobile Insurance Co. said it will return $1 billion to its policyholders as a reflection of better-than-expected financial results. State Farm’s board approved the premiums to be paid to auto insurance policyholders in 49 states--all but New Jersey--plus the District of Columbia and three Canadian provinces. The premiums vary depending on the state or province but will average about $29 per insured vehicle, State Farm said. The nation’s largest auto insurer said payments will be sent by check during the six-month policy renewal period that began Monday. It’s the seventh dividend by State Farm since 1991, and the biggest, topping the $892 million announced in June 1998. The company said it doesn’t plan dividends when setting prices, but does return money to customers when financial results are better than anticipated and business conditions permit.