State Farm scales back its smart-home bet on ADT

Three years after pouring $1.2 billion into ADT to bring smart-home technology into the insurance mainstream, State Farm is pulling back.

The partnership, unveiled in 2022 as a blueprint for “predict and prevent” home protection, gave the insurer a 15% stake in the security company and included up to $300 million in additional funding for product innovation. Google, already an ADT partner, agreed to match with an incremental $150 million investment. Together, the trio envisioned a connected-home ecosystem where sensors, telematics, and real-time data would help prevent losses from fire, water, or theft before they triggered a claim.

By early 2023, the promise took shape in select markets. Indiana homeowners were the first to access discounted ADT packages—including security panels, smoke detectors, and water sensors—starting at $19.99 per month for a 36-month monitoring contract. Customers could earn up to a 6% premium discount from State Farm, provided they shared system usage data (excluding audio and video). Later that year, Illinois and Pennsylvania joined the rollout.

But enthusiasm has cooled. According to recent regulatory filings shared first by Coverager, State Farm has discontinued its ADT Home Security program in Nevada and Tennessee, citing low adoption and high costs. Existing customers remain supported under ADT’s current contracts, while State Farm continues to offer its Home Alert Protection discount.

ADT’s Q3 2025 earnings call on November 4 revealed weaker-than-expected results and the end of its three-year partnership with State Farm. The program generated only about 33,000 subscribers, prompting ADT to pivot toward a new digital initiative focused on home relocations. Details remain limited, though CEO Jim DeVries said the companies will continue collaborating through data-sharing efforts, where—with customer consent—alarm activity informs State Farm’s risk models.

“We’re in the very early days of design. It’s not necessarily the last effort trying the traditional distribution with State Farm, but it’s a fresh tactic, and we’re going to lean in here and see if we can get some traction. An advantage is that it’s in the potential buy flow. And so there’s not a reliance on agent execution as there is in the traditional path. This is a digital process directed at relocating customers. I should also mention we’re continuing our data sharing program with State Farm, where with customer consent, we share alarm activity at the customer’s home with State Farm. And so we continue to kick tires on that front to see if there’s a source of value. But back again on your original question about the advantage of the digital program, I would say, is that it’s included in the buy flow, a more natural process and one we hope we get better traction with.” – DeVries.