New Delhi, Aug. 18 -- State Farm has started distributing a one-time $5 billion cash-back dividend to eligible auto insurance customers, marking the largest such payout in the company's more than 100-year history.

Millions of policyholders have already received their payments, while additional payments are expected to be sent in waves over the coming months.

The payout is a one-time policyholder dividend being distributed by State Farm Mutual Automobile Insurance Company, the mutual company at the centre of State Farm's US auto insurance business.

Unlike a conventional publicly traded insurer, a mutual insurance company is owned by its policyholders. State Farm says this structure allows it to return value directly to customers while m...