Some State Farm Mutual Automobile Insurance customers in southcentral Kentucky could get a surprise check in the mail this year.

The company announced earlier this month that its auto insurance policyholders in Kentucky will receive dividends totaling $19.6 million.

A dividend is a voluntary payment made based on the recommendation by State Farm’s board of directors, according to Maggie Lee, State Farm public policy specialist.

&#8220Everyone that had a State Farm Mutual policy on Dec. 31, 2006, will receive some type of dividend,” Lee said. Those who canceled before the end of last year aren’t eligible.

Kentucky policyholders will receive 10.4 percent of a semi-annual premium. Although the amounts will vary, the average dividend per vehicle in Kentucky is $32.34, according to Lee.

Dividend payments will begin in early April and continue throughout the year.

Policyholders can expect to receive their dividend near the time of their policy renewal.

Most customers will receive their dividend by check, but amounts less than $15 will be credited toward the policyholder’s State Farm policy fee.

The Kentucky Office of Insurance sees it as another indication the insurance market is stabilizing after hurricanes and tornadoes caused losses in previous years, according to Ronda Sloan, communications director.

&#8220We had a lot of storm losses for a couple of years in a row, which would have obviously affected the profits that companies have made. This is a good sign, that they’re paying dividends,” Sloan said. &#8220We went through such a period of time when there were losses and premiums were increasing. This may be a sign that the market is stabilizing somewhat.”

Kentucky Farm Bureau Mutual Insurance Company, the second largest insurer in the state, also recently passed out dividends to its customers, Sloan said.

In 2002, preliminary estimates from the Insurance Services Office Inc.’s Property Claim Services unit showed Kentucky led the nation in insured-property damage from catastrophes with $885 million in losses, followed by Texas with $630 million, Louisiana with $555 million, Maryland with $289 million, and Ohio with $275 million.

Sloan said even though the industry doesn’t know what spring storms will bring, now is a good time to go shopping for lower rates, she said.

&#8220We’re seeing premium rates stabilize, and in some cases, we have had some companies file for slight decreases,” Sloan said.

State Farm Mutual policyholders in 46 states, the District of Columbia and the Canadian province of New Brunswick will receive a total of $1.25 billion in the company’s latest policyholder dividend declaration.

With this dividend, State Farm Mutual will have returned $3.8 billion to auto policyholders since 1997. In addition, State Farm Mutual reduced its overall rate level in Kentucky by 9.3 percent from the beginning of 2004 to the end of 2006.