Costco Car Insurance – Member Savings Explained

Costco car insurance is an exclusive auto insurance program for Costco members. The coverage is underwritten by American Family Insurance’s Connect brand (formerly Ameriprise Auto & Home). Costco members can purchase auto policies through Costco’s website or in-store services, often with special member-only rates and perks. In this article, we explore how Costco car insurance works, the coverage options offered, and the savings and discounts available to members.

We’ll also compare Costco’s rates to other insurers, review customer feedback, and answer frequently asked questions about Costco’s auto insurance program. By understanding these details, Costco members can decide if this program delivers genuine savings and value on car insurance.

How Costco Car Insurance Works?

Costco does not underwrite insurance itself. Instead, Costco members get car insurance through a partnership with American Family Insurance (CONNECT). The insurance is handled by “CONNECT, powered by American Family Insurance,” which was formerly known as Ameriprise Auto & Home. In 2019 American Family acquired Ameriprise’s auto & home business, rebranding it as CONNECT in 2020. Today, Costco auto policies are issued by American Family Connect P&C and related affiliates. Costco itself acts only as a broker: Costco Insurance Agency does not underwrite or pay claims.

Costco car insurance is available only to Costco members. To get a quote or buy a policy, you must have a Costco membership. Members can get quotes online through the Costco website or by speaking to a representative at any Costco warehouse. The process is straightforward:

• Gather Your Info: You’ll need basic details like home address, vehicle VIN, driver’s license numbers, and information on your current coverage or claims history.
• Provide Membership Number: Enter your Costco membership number when applying. This triggers the exclusive Costco member discount.
• Get Quotes Online or In-Store: Use Costco’s Auto & Home Insurance page or call the toll-free number (e.g., 1-855-531-9253 shown on Costco’s site) to request a personalized quote.
• Choose Coverage and Buy: Review the customized quote and available coverage options, then finalize the policy by making the first payment. Executive Members (higher-tier Costco) may see extra perks or be prompted to review Executive benefits.

Throughout the process, Costco members work directly with CONNECT/American Family for the policy terms, underwriting, and servicing. Costco’s website clearly states: “Auto policies are underwritten by American Family Connect Property & Casualty Insurance Company (etc.)… Costco Insurance Agency… does not underwrite insurance or pay claims”. In short, Costco provides a convenient gateway and member discount, while the actual insurer is a large, financially stable company.

Coverage Options

Costco car insurance policies offer the same core coverage types as any major insurer. Standard coverages include:

• Liability Insurance: Pays for other people’s medical bills (Bodily Injury) or property damage when you’re at fault.
• Collision Coverage: Pays for damage to your own car after a crash, regardless of fault.
• Comprehensive Coverage: Covers non-collision damage (theft, vandalism, animal strikes, natural disasters).
• Uninsured/Underinsured Motorist (UM/UIM): Protects you if an at-fault driver has no or insufficient insurance.
• Personal Injury Protection (PIP) / Medical Payments: Pays medical and related expenses after an accident, regardless of fault.

In addition to these essentials, Costco’s program offers useful optional coverages. For example, Executive Members get free roadside assistance on auto policies. Other add-ons (for a fee) include:

• Roadside Assistance: Towing, flat-tire service, fuel delivery, battery jump-starts, and lockout service.
• Rental Car Reimbursement: Covers a rental car if your vehicle is in the shop after a covered incident.
• GAP Insurance: Covers the “gap” between what your car is worth and what you owe on a loan/lease if it’s totaled.
• New Car Replacement: Pays to replace a totaled new car with a brand-new one (usually if under 15,000 miles).
• Additional coverages: Some states may offer extra options like enhanced roadside plans or extended coverage through American Family’s network.

NerdWallet’s Costco review explains that Costco policies allow adding roadside assistance and rental reimbursement (the former included for some members). Policygenius notes that lifetime renewability – the guarantee that your policy will renew even after an accident – is automatically included for Exec Members (with certain state exceptions). This means an Executive Member can’t be dropped or non-renewed simply for filing a claim (barring major violations like DUI).

Overall, Costco’s car insurance offers the same foundational coverages you’d get anywhere, with a few Costco-specific perks. You get liability, collision, comp, UM/UIM, PIP/MedPay, plus options like roadside, rental, GAP, and new car replacement. These can be added to enhance your policy. As always, when choosing amounts (liability limits, deductibles, etc.), consider your needs and state requirements: higher limits give more protection, especially if you drive often or own a valuable vehicle.

Member Discounts and Savings

For Costco members, the Costco Auto Insurance program promises exclusive savings and perks. A variety of discounts – plus extra benefits for Executive members – can make coverage cheaper and more attractive compared to standard car insurance.

Costco touts a “Costco member discount” on auto (and home) insurance in most states. In practice, this means lower base rates for members, on top of other savings. Here are the key member savings features:

• Executive Member Perks: Costco’s highest-level members (Executive tier) get extra benefits. NerdWallet reports that Costco Auto Insurance includes free roadside assistance and guaranteed lifetime renewability for Executive members. Similarly, Policygenius confirms that Executive members’ policies automatically renew even after a claim, ensuring you won’t be dropped after an accident. These perks add value: free towing or fuel (up to $75 per incident) can be worth the Executive membership cost if you use it.
• Base Member Discount: All Costco members can receive a standard insurance discount. Costco advertises that members could save on auto insurance through the Costco program. For example, Costco cites an average first-year saving of $595 when switching to its Connect-based auto insurance. Another analysis found a Costco policy in California averaged about $114/month, which is 31% cheaper than the state average for car insurance.
• Bundling Discount: You can save by bundling auto with other policies. If you buy both auto and home (or umbrella) insurance through Costco/Connect, you earn a multi-policy discount. This makes Costco’s combined auto/home offerings more attractive.
• Good Student and Loyalty Discounts: Students with good grades (usually B average or higher) qualify for a good-student discount. There’s also a loyalty discount: Policygenius notes you get a discount after keeping Costco insurance four years in a row.
• Safe Driver Discounts: Having a clean driving record (no accidents or claims) often earns a discount. NerdWallet and Costco’s info mention no violations or claims in 3–4 years reduces rates.
• Defensive Driving Discount: Completing an approved driver safety course can lower premiums.
• Vehicle Safety Features: Discounts are available for cars with anti-theft devices, anti-lock brakes, airbags, automatic seat belts, crash-avoidance tech, etc..
• Multi-Car Discount: Insuring two or more vehicles together yields savings.
• Other Discounts: Parking your car in a locked garage, having a student away at college, bundling with other policies, and continuous coverage with American Family can all provide small additional discounts. (Exact offerings vary by state.)

Together, these discounts mean many members see real savings. For instance, one study reported Connect’s (Costco’s insurer) full coverage rates about 37% below the national average. And those average savings ($595/year or 31% lower) suggest Costco membership can cut premiums substantially for qualifying drivers.

Example Bulletpoints – Potential Costco Auto Discounts:

• Executive Member Perks: free roadside assistance, guaranteed renewability
• Multi-policy discount (Auto + Home/Umbrella)
• Clean driving record (no claims/violations)
• Defensive driving course completion
• Good student (B-average or higher)
• Safety features (alarm, ABS, airbags)
• Multi-car and continuous coverage discounts

While the exact discount amounts are not publicly listed, policy analyses confirm that Costco/Connect offers “a wide assortment of discounts”. The NerdWallet review gives Costco car insurance a 3.9/5 rating mainly for its member discounts and savings. Costco’s own site and third-party guides encourage members to quote these savings and compare: “Costco members could save even more with an exclusive member discount on auto & home insurance.”.

In summary, the “member savings” angle of Costco auto insurance is real: it combines a base Costco membership discount with standard insurer discounts, and adds Exec-member freebies. For many drivers (especially those in Exec membership tier), this program can yield substantially lower premiums and extra benefits, compared to typical standalone policies.

Rates and Price Comparison

A big question for shoppers is how Costco car insurance rates stack up against the competition. Here are some data-driven insights:

• Lower-than-average full coverage rates: Independent research finds Costco’s insurer (Connect/American Family) charges well below national averages. Connect’s average full-coverage premium was about $1,520/year, versus a national average of $2,399 (about 37% lower). For minimum coverage, the average was $1,020/year.
• Member savings illustrated: The Costco program claims big first-year savings. As noted, customers switching to Costco’s Connect-backed car insurance saved an average of $595.86 in year one. In concrete terms, Policygenius’ example showed a Costco member in California paying about $114/month (31% below the state average).
• Compare with other insurers: In one comparison, Connect’s full-coverage rate was $1,520 vs AAA’s $3,014, Allstate’s $2,605, GEICO’s $1,731, etc.. This suggests Connect (Costco) offers aggressively competitive pricing on full coverage.
• Potential variability: Not every customer will always save. Real user reports (from forums) show mixed results – some members got quotes $200–$400 lower than their previous policy, while others found Costco quotes higher than offers from Progressive or Allstate. Factors like driving history, location, vehicle type, and prior coverage affect each quote.

To get the best rates, Costco recommends members compare quotes. You can easily get Costco car insurance quotes online at Costco’s insurance portal (costcoauto.com) or via Connect’s site. Many experts suggest shopping multiple companies even after getting a Costco quote. For example, NerdWallet advises: “make sure its price works for you, and check that you’ll get all the features you want,” since in some states you can also buy American Family directly. In other words, always do a personalized quote comparison.

Here is a quick rate comparison illustrating typical costs:

Company	Avg Annual Premium (Full Coverage)	Avg Annual Premium (Minimum Coverage)
National Avg	$2,399	$635
Connect (Costco)	$1,520 (–37%)	$1,020
AAA	$3,014	$1,056
Allstate	$2,605	$840
Erie	$1,647	$581
Farmers	$2,979	$1,002
GEICO	$1,731	$517
Nationwide	$1,808	$718
Progressive	$1,960	$638
State Farm	$2,167	$674

(Source: AutoInsurance.com “Connect” rate data; lower % indicates how much cheaper Connect is versus national avg.)

From this table, Connect (Costco) is among the cheapest full-coverage options. But remember, your actual quote may vary. A huge saving like –37% is possible especially if you stack discounts, but you should always compare your personalized Costco quote against other insurers.

Key rate takeaways: Costco’s program tends to have very competitive rates, especially for full coverage and when member discounts apply. Executive members or those bundling with home can see particularly large savings. However, Costco-affiliated insurance isn’t guaranteed cheapest for every driver; some may find a bit higher cost, so checking quotes from Geico, Progressive, Allstate, and others is wise.

Reviews and Customer Satisfaction

When evaluating Costco car insurance, it’s important to consider customer and expert reviews. Overall, Costco’s auto program gets mixed but generally positive scores on discounts and service:

• Expert Ratings: NerdWallet gave Costco Auto Insurance 3.9 out of 5 stars. They praised the “great set of discounts” but noted some limitations. WalletHub’s (Connect) rating is around 2.98/5 (below average), citing competitive pricing but a higher complaint volume (Connect has about twice as many complaints as average competitors). Policygenius highlights that Connect scored 834/1,000 in JD Power’s 2022 California claims satisfaction (above average) and has an NAIC complaint index of 1.27 (about average). These metrics suggest decent service and a solid track record. For context, American Family (Connect’s parent) has AM Best A+ financial rating and ranks high on stability.
• Customer Complaints: NerdWallet notes that Costco/Connect has “more than the expected number of complaints” to regulators. AutoInsurance.com reports American Family’s NAIC complaint index as 2.67 (meaning significantly above average). (There’s some discrepancy here: Policygenius’ 1.27 suggests average, while AutoInsurance’s 2.67 suggests higher-than-average. It may depend on which lines are measured or year.) In practice, some policyholders have voiced frustration. For example, in forums a few members said Costco quotes were expensive and customer service was just “okay”.
• Customer Feedback: Reddit threads reveal mixed experiences. One user reported Costco/Connect quotes were “one of the most expensive” they received; another said it was cheaper than big-name carriers for them. Some members praise the service: one commenter said Connect customer service by phone and website was “reasonably good”. Others note that Costco does not underwrite, so service quality is really Connect’s responsibility.
• Customer Service: According to Policygenius, Connect/American Family generally earns above-average customer satisfaction in several categories (price, coverage, claims). JD Power’s regional data show Connect above average in California, and American Family above average nationally. The AM Best A (Stable) rating for Connect/American Family indicates financial strength, which implies reliability in honoring claims.

In summary, reviews suggest Costco’s auto insurer is reputable with strong financial backing and a variety of discounts, but potential customers should be aware of slightly higher complaint ratios reported by analysts. It’s wise to read the policy details and talk to the insurer or agent to clarify any concerns. On the whole, expert reviews lean positive on value and coverage but note room for improvement on digital tools and customization.

Customer Service and Claims

Costco does not handle claims or service directly – your insurer does. If you purchase car insurance through Costco, all customer service and claims are handled by Connect (American Family). Here’s what to expect:

• Claim Filing: You can file a claim online via Connect’s website or mobile app (if available) or by calling the claims number provided on your policy. Connect promises that “claims adjusters will reach out within one business day” after a claim is filed. Remember to have your policy number and details ready.
• No Mobile App: Connect currently does not have a dedicated mobile app for customers. This means you manage your policy and claims through their website or customer service line. NerdWallet notes this is a downside compared to some competitors with modern apps.
• Response Experience: Policygenius reports Connect scored 834/1000 on JD Power’s Auto Insurance claims satisfaction study in CA, which is above average. Nationwide, American Family (Connect’s parent) was above average for shopping satisfaction, though slightly below average for claims satisfaction. In practice, expect solid but not outstanding service: customer reports imply claims are handled competently, but you may not have real-time app updates (you might have to call for status).
• Customer Support: Connect’s customer service line and website handle questions about billing, claims, and policy changes. According to Policygenius, Connect’s complaint index is about industry average, meaning service issues are on par with typical insurers.
• Insurance Agency Role: Note that Costco Insurance Agency (the Costco entity) merely sends you to Connect/American Family. Costco agents may help get you a quote, but any policy questions after purchase go to Connect. Costco’s website and membership benefits pages redirect you to the American Family site or Connect for servicing.

Overall, customer service is handled by Connect/American Family, which is a large insurer with trained staff. They generally have good satisfaction scores. If you prefer managing insurance digitally, be aware there’s no dedicated app, unlike some competitors. But for most routine issues (rate questions, adding coverage, filing claims), service should be comparable to other mid-sized insurers.

How Costco Compares to Other Insurers

When deciding on auto insurance, it helps to compare Costco’s program to other options. Here are some key points:

• Costco vs American Family Direct: Since Costco’s policies are underwritten by American Family Connect, one might think of buying direct from American Family instead. NerdWallet notes that American Family (direct) has more discounts available (like usage-based plans) and a full-featured app. However, some states only offer American Family through Costco, so members may not have a direct American Family quote option in those regions. In states where both are available, it’s wise to compare: sometimes Costco’s member discount wins, other times American Family’s direct offerings (like the Drive My Way program) might save more.
• Costco vs Other Big Carriers: Compared to carriers like State Farm, Geico, Progressive, etc., Costco’s program is unique in that it requires a membership but then offers member perks. Traditional insurers often offer their own discounts and digital tools. For example, GEICO and Progressive have very strong online tools and usage-based programs, while State Farm has a large agent network and a popular app (Drive Safe & Save). Costco/Connect may lack the app but competes with highly discounted rates and bundling options.
  • Pricing: As seen above, Connect’s rates are often lower on average than many competitors. However, rates can vary: some drivers report Geico or Allstate giving cheaper quotes depending on profile.
  • Coverage Options: Most insurers offer similar coverage types. Where Costco stands out is Executive renewability and some Costco-specific discounts. Traditional insurers may have niche options (rideshare coverage, usage-based telematics, etc.) that Costco/Connect does not currently offer.
• Costco vs Costco: (Yes, two Costco programs!) Costco also has a well-known car-buying program (“Costco Auto Program”) and partners for other services. But importantly, Costco’s auto-buying service is separate; it just gives you dealer pricing. The insurance program is its own partnership with Connect.

Ultimately, the best approach is to get multiple quotes. Use Costco’s quote as one data point (especially to capture member discounts), then compare with quotes from at least one other large insurer and one digital insurer. Many experts recommend doing an annual rate check. As one Reddit user advised: “Definitely keep re-pricing every once in a while to make sure you’re not getting screwed over”.

In summary, Costco’s car insurance often offers strong value (especially with bundle and Executive perks) but lacks some bells and whistles of big national insurers. For drivers who value discounts and simplicity, it’s a great option. If you need the latest tech or niche coverages, you might supplement it with a competitor. Always compare Costco’s quote against at least two other insurers to ensure you get the best deal.

Costco Car Insurance FAQs

Q: What is Costco car insurance?
A: It’s an auto insurance policy available exclusively to Costco members. The policies are offered through Costco’s partnership with CONNECT (American Family Insurance’s brand). In practice, when you buy “Costco” auto insurance, the underwriter is American Family Connect Property & Casualty or a sister company. Costco provides the membership discount and sales channel, but American Family handles the claims and underwriting.

Q: Who can get Costco car insurance?
A: Only Costco members are eligible. You must provide a Costco membership number (Gold Star or Executive tier) to access the discounted rates. Executive Members often see additional perks and discounts. Non-members cannot buy insurance through the Costco program.

Q: How do I get a Costco car insurance quote?
A: You can get a quote online at Costco’s Auto & Home Insurance page (costcoauto.com) or by calling Connect/American Family through Costco’s referral. You’ll fill in your details (address, vehicle VIN, driving record, etc.) and enter your Costco membership number. You can also ask a Costco insurance rep in-store to request a quote on your behalf. Make sure to ask about all discounts you qualify for.

Q: What coverages are included with Costco car insurance?
A: Costco’s auto policies include all standard coverages: liability (bodily injury and property damage), collision, comprehensive, uninsured/underinsured motorist, and personal injury protection or medical payments. You can also add optional coverages like roadside assistance, rental reimbursement, GAP insurance, and new car replacement. Executive Members get roadside assistance included.

Q: Does Costco car insurance offer good discounts?
A: Yes. All members get a base “Costco member discount” on rates, plus access to insurer discounts. Common discounts include multi-policy bundling (auto+home), clean driving record, defensive driving course, good student, safe vehicle features, and multi-car. Executive members have extra perks (free roadside, renewability). In total, many members see substantial savings (e.g., NerdWallet found average savings of hundreds of dollars the first year). Always ask for every discount you qualify for when quoting.

Q: Are Costco car insurance rates cheaper?
A: Often, yes. Studies show Connect (Costco’s insurer) has below-average premiums. For example, full-coverage premiums ran ~37% below the national average. Policygenius found a Costco policy 31% cheaper than the average in California. Plus, Costco reports an average $595 annual saving for switchers. However, individual rates depend on your profile. Some members find better deals elsewhere, so it’s wise to compare quotes.

Q: How do I file a claim or contact customer service?
A: If you need help or want to file a claim, you must contact Connect/American Family (the insurer). You can file claims online through the Connect website or call their claims phone number (shown on your policy documents). Connect aims to have an adjuster contact you within one business day. Keep in mind Connect currently has no mobile app, so claim status updates usually come via phone or email. If you have questions about your policy or need assistance, call the Connect customer service number or visit an American Family Insurance site. Costco employees cannot handle claims or billing for you.

Q: Is the insurance reliable and stable?
A: Yes. Connect/American Family is financially strong (AM Best A-rated). Customer satisfaction scores are generally solid (above-average in J.D. Power for shopping and claims in some regions). While there are some complaint filings (as with any large insurer), Connect’s ratings are comparable to industry norms.

Q: Do I need a Costco membership for the discounts?
A: Absolutely. Your Costco membership qualifies you for the exclusive program and the member discounts. Without a membership, you can’t access those rates or perks. For non-members, it might make sense to join Costco if the insurance savings outweigh the membership fee (current annual dues are ~$60–$120).

Conclusion

Costco car insurance offers Costco members a straightforward way to buy auto coverage at discounted rates. With a partnership through American Family’s Connect brand, members get access to a full suite of coverages and many of the usual car insurance discounts, plus extra perks for Exec members. In practice, Costco’s rates tend to be significantly below average, and members report substantial savings (e.g. ~$600 first-year savings). However, prices can vary by driver profile, so it pays to compare quotes with other insurers too.

In summary, Costco’s program is worth checking out if you’re a member. It is best for drivers who value discounts and bundle savings. The coverage is solid and underwritten by a major carrier (American Family), though it lacks some digital features. We recommend getting a quote through Costco’s insurance portal, comparing it with a couple of other quotes, and reading any plan details carefully.

If you have experience with Costco car insurance (good or bad), please share in the comments below to help fellow shoppers! And if you’re interested, consider getting a personalized quote today to see how much a Costco member discount could save you on your car insurance.