State Farm Bank's CD Page has the details and the link to the Truth in Savings Disclosure. According to the disclosure, the early withdrawal penalty is 180 days of interest on the principal withdrawn.
State Farm Bank also has a competitive rate on its Interest Checking Account. As of 3/11/09, the rate is 1.55% APY on balances of at least $2,500 (0% for smaller balances). Minimum opening deposit is $100, and there's a $10 monthly fee for average daily balances under $500. This checking account may not seem too competitive, but it's not bad if you compare it to 1% at Charles Schwab or 0.50% at ING Direct.
You can apply online, but a printer is required, as you will be required to print, sign and mail the application to State Farm along with your initial deposit. You may also apply for an account by contacting State Farm Bank toll-free at 1-877-SF4-BANK (1-877-734-2265) or by contacting a participating State Farm agent.
State Farm Bank has some decent ratings for safety and soundness: 3.5 stars (good) at BauerFinancial and 3 stars (performing) at Bankrate.com. Both ratings are based on 9/30/08 financial data. State Farm Bank has been FDIC insured since 1999 (FDIC Certificate # 34617).
Other Top Certificate of Deposit Rates
The best bank deal for terms around two years continues to be at GMAC Bank with a 3.00% APY 24-month CD (see review). One of the top two-year CD deals for credit unions continues to be at Alliant Credit Union which is offering a 3.30% APY for terms of 24 to 35 months with a minimum deposit of $25K (see review). Refer to my weekly rate summary for other deals. Please note that some rates have already dropped since my Saturday update.