Contribution made to U.S. Qualified Pension Plan

As a result of the flexibility created under recent pension reform legislation, the State Farm Mutual Board of Directors approved a $900 million contribution to the U.S. Qualified Pension Plan in 2006.  The contribution does not impact pre-tax operating results, but does reduce State Farm Mutual’s net worth.

The contribution does not change the calculation of employee or retiree benefits. Rather, the contribution helps ensure the plan will remain adequately funded for the next several years based on current actuarial assumptions and projected returns on plan assets.

This contribution was mentioned in the press release of the State Farm 2006 financial results.  The press release also discusses a dividend announcement for State Farm Mutual Automobile policyholders. Please visit our Current News Release page to view the press release on statefarm.com® and get more details.