State Farm Insurance CompaniesState Farm Insurance Companies

State Farm Financial Operations & Compliance

Fall 2005

State Farm Insurance CompaniesState Farm Insurance Companies

Why Have Insurance?

What is Insurance?

• Promise

• Transfer of Risk

• Indemnity Principal

• Social Device

Types of Insurance

• Property

• Casualty

• Life

• Health

U.S. Industry Scope

• Around 5,000 domestic insurance companies

• 2.1 million jobs as of May 2005 (down from 2.3 million in 2003)

• $956 billion in premiums in 2004 (P/C & L/H)

• Industry return on equity in 2004:– 14.1% in P/C; 14.4% in L/H

Sources: A.M. Best, Insurance Information Institute, Bureau of Labor Statistics

“ABOUT STATE FARM”

State Farm’s mission is to: •help people manage the risks of everyday life,

•recover from the unexpected, •and realize their dreams.

Our Vision for the future...

...is to be the customer’s ...is to be the customer’s firstfirst andand best best choicechoice in the products and services in the products and services we provide. We will continue to be we provide. We will continue to be the the leaderleader in the in the insurance industryinsurance industry and we will become a leader in the and we will become a leader in the financial services arenafinancial services arena. Our . Our customers’ needs will determine our customers’ needs will determine our path. Our values will guide us.path. Our values will guide us.

State Farm Data

• 23 Affiliated Companies

• $149.8 Billion in Assets (12/31/04)

• 16,800 Agents

• 69,000 Employees

• 1,800 Accounting Employees

• 75 Million Policies & Accounts

• Mutually Owned Company

Industry Positions

• Ranked #19 within Fortune 500

• #1 U.S. Auto insurer since 1942• 18.2% Market Share at end of 2004• Almost 40 million Auto policies

• #1 U.S. Home insurer since 1964• 22.5% Market Share at end of 2004• Over 24 million Fire policies• Leading insurer of pleasure boats

State Farm Product Lines

•Financial Services

•Life•Health•State Farm Bank®•State Farm Mutual Funds®

Regulation

• Highly Regulated By the States

Financial Statements

• Statutory Emphasis is on Insolvency

• Not All Company Assets Are “Admitted”

• States Perform Various Insolvency Tests From Financial Statements

GAAP vs. Statutory AccountingGAAP vs. Statutory Accounting

Finance Structure

• Centralized vs. De-centralized• Corporate• Zone Operation Centers• Insurance Support Centers (ISC’s)

• Supervisory vs. Analyst

State Farm Corporate Building

Corporate Functions

• Financial Reporting & Analysis

• General Accounting Services

• Tax

• Investment Accounting

• Accounting Benefits

Corporate Functions

• Loss Reserves

• Planning & Analysis

• Data Management Services

• Auditing & Compliance

• Treasury Services

• Administration

Corporate Functions

• Financial Shared Services– Accounts Payable

– Agency Compensation

– Employee Compensation

– Travel and Expense

Corporate Atrium

Corporate Atrium

Zone Structure

Field Finance Functions

• Payment Processing

• Cash Disbursements

• Agency Compensation

• Self Audits

• Expense Analysis

Corporate South Complex

Systems

• Financial Business Analyst– Current Systems Support– New Systems Development– Create and maintain detailed operating

procedures

Corporate South Complex

• People Skills

• Performance Management

• Organization & Planning

• Problem Solving

• Time Management

• Communication

Daily Duties – Supervision

Daily Duties - Analyst

• Problem Solving

• Project Development

• Operational Assistance

• Coordination

• Communication

• Functional Area of Expertise

Technical Training

• On-Line Operating Procedures

• Hardware and Software– Vendor Application– Numerous proprietary applications

• Supervisory Skills– CD-ROM Leadership Development Series

Professional Development

• In-House Courses

• Insurance Education

– CPCU, ChFC, CLU, FLMI

• Professional Designations

– CPA, CMA, CFA

• Tuition Aid

Career Paths

DiversityDiversity

OpportunityOpportunity

MobilityMobility

Key Benefits to Consider

• Competitive salary

• Paid time off

• Types of Insurance

• 401(k) matching

• Pension plans

• Alternative work arrangements

• Work environment/dress code

• Affinity groups/activities/sports

What We’re Looking For

• Accounting and other business majors with a minimum of 9 hours of Accounting

• CIS/MIS hours are beneficial

• Leadership, communication skills, analytical thinking, learning agility, etc.

• 3.2 GPA overall and in major

Internship Information

Dates: Begin May 22, 2006 End August 4, 2006

Salary: $14.00/Hour$15.00/Hour - Returning Interns

Higher hourly rate for interns with an exam

Housing: Subsidized HousingState Farm provides assistance in

locating housing in the Bloomington/Normal community

Internship 2006

• Provides a practical and meaningful work experience

• Benefits– Exposure to our various departments &

leadership team– Overall view of the corporate environment– Interaction with other interns as well as State

Farm employees

CONTACT INFORMATION

State Farm Insurance

Human Resources

Three State Farm Plaza South, K-1

Bloomington, IL 61791

E-mail: jobopps.corpsouth@statefarm.com

Need more information? Visit our website!

www.statefarm.com

State Farm Corporate

State Farm Park

State Farm Park

State Farm Park

State Farm Downtown BuildingState Farm Downtown Building

About the Bloomington/Normal About the Bloomington/Normal Area Culture/Arts/HistoryArea Culture/Arts/History

Culture/Arts/History

Culture/Arts/History

Education

Education

Education

Education

Education

Around the Town

Around the Town

Around the Town

Any Questions?