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Costco Car Insurance Rating: 4.3 Out Of 5.0

Cost

4.7

Coverage

3.8

Reliability

4.0

Service

4.7

Overall Rating

4.3

With a reputation for low prices and an impressive array of products, Costco has developed quite the loyal following. Many shoppers at the members-only warehouse company wonder if Costco car insurance lives up to the brand’s hype.

In this review, we’ll closely inspect Costco car insurance to find out whether it can compete with the country’s best car insurance companies.

40+
COMPANIES ANALYZED
1.5M
RATES REVIEWED
1,000
CUSTOMERS SURVEYED
1,200
RESEARCH HOURS
2,150
DATA POINTS

Costco Car Insurance Cost And Discounts

Costco insurance performs quite well on pricing. The retailer’s plans usually undercut the competition, offering car insurance rates unseen by most other providers. American Family Insurance, which actually takes care of Costco car insurance policies, is known for its cheap plans.

Regardless of the provider you choose, how much car insurance is depends on the individual. Some key factors that could affect your amount due include:

  • Location: States with demanding car insurance standards, higher crime rates, and higher numbers of uninsured motorists cause car insurance costs to increase. Urban residents also tend to have higher premiums than rural areas.
  • Age and gender: Younger men pay steep prices for car insurance, though premiums go down as drivers age.
  • Marital status: Married drivers are involved in less accidents than single drivers, so they pay lower prices on average.
  • Credit score: The lower your credit score, typically the higher your auto insurance rate.
  • Driving history: If you have a history of car accidents or DUIs, you’ll pay significantly higher car insurance premiums.
  • Vehicle type: If you have a new car, a vehicle commonly targeted for theft, or one rated poorly for safety, expect to pay more on car insurance.

Costco Car Insurance Discounts

Excellent rates can be found through Costco car insurance, but discounts still come in handy. The company has plenty of additional savings opportunities.

Affinity DiscountSavings for those with a Costco membership
Good Driver DiscountWorks as a safe driving discount (only for car insurance in California)
Premier Safety DiscountRewards clean driving records over the last four years
Defensive Driver DiscountTake a refresher course on driving skills
Vehicle Safety Features DiscountBenefits cars with anti-lock brakes, air bags, automatic seat belts, and anti-theft devices
Garaging DiscountIf you park your car in a garage overnight
Good Student DiscountLowered rates for students with strong academic performance
Student Away DiscountHelps students who leave cars at home during college
Multi-Car DiscountSave money on plans with more than one vehicle
Multi-Product DiscountRewards the bundling of Costco car insurance plans with home insurance or umbrella insurance policies
Tenure DiscountHelps those who’ve held the same insurance plan for years

Costco’s multi-product discount benefits those who bundle Costco car insurance plans with the retailer’s options for home insurance and umbrella insurance. This is a great way to save if you’re ready to let Costco cover all of your insurance needs. Keep in mind that American Family Insurance will become your provider in all three cases.

Costco Car Insurance Coverage

Those who pick Costco car insurance can expect to choose from various coverage options. Liability coverage comes standard with every plan, as required by law. It’s recommended to get more than the minimum car insurance standard so that you’ll be prepared when problems arise.

Costco Standard Car Insurance Coverage

Liability

Bodily injury (BI) liability insurance covers the medical expenses for other drivers and their passengers after an accident where you are at fault. Property damage (PD) liability insurance pays for damages to other drivers’ vehicles after an accident where you are at fault.

Collision

Collision insurance pays for damages that occur while your car is moving, either with another vehicle, a road hazard, or if you flip your vehicle.

Comprehensive

Comprehensive insurance pays for damages to your own vehicle that are caused by animals or natural disasters. It also pays to repair or replace your vehicle if it is stolen or vandalized.

Uninsured/Underinsured Motorist

Uninsured/underinsured motorist (UIM) coverage pays for damages to your vehicle if you are hit by another driver who does not have insurance or does not have enough insurance to fully pay for the cost of damages.

Personal Injury Protection

Personal injury protection (PIP) pays the medical bills for you and your passengers after an accident. PIP may also pay for other expenses such as lost wages.

Medical Payments

Medical payments (MedPay) covers medical bills for you and your passengers after an accident.

Additional Costco Car Insurance Coverage

When purchasing a Costco car insurance plan, customers can choose from the following additional benefits:

  • Roadside assistance: Roadside assistance ensures that your car will get fixed if it breaks down mid-trip.
  • Towing coverage: Towing coverage takes care of the costs of having your car towed after a breakdown.
  • Rental car reimbursement: Rental car reimbursement covers your transportation needs, up to a certain amount, while your car is in the shop for repairs.
  • Guaranteed asset protection: GAP insurance pays the difference between your loans and your car’s depreciated value if it gets totaled.
  • Glass repair deductible waiver: This eliminates your deductible if your windshield can be repaired rather than replaced after being dented.
  • Stolen key coverage: This covers the costs to replace your car key after a theft if you have comprehensive insurance.
  • Accident travel expense coverage: Accident coverage takes care of travel and accommodation expenses if you end up in an accident over 100 miles from home.

Costco Executive members receive lifetime renewability and free roadside assistance with every plan. Lifetime renewability is a standout feature, as it ensures that policyholders with Executive membership won’t be dropped due to most accidents or traffic violations.

Costco Car Insurance Mobile App

There is no Costco car insurance app, but customers can take advantage of the American Family mobile app–which is highly rated on both Google Play and the App Store. You can use this app to get car insurance quotes, purchase plans, pay auto insurance bills, and even send in car insurance claims.

Costco Car Insurance Reviews

Better Business Bureau (BBB) rating: A
BBB complaints in the past three years: 150
J.D. Power customer satisfaction index: 899 out of 1,000
Trustpilot rating: 3.5 out of 5.0 stars

Since American Family Insurance underwrites every Costco car insurance policy, it’s worth checking out that provider’s customer reviews. The J.D. Power 2021 U.S. Insurance Shopping Study ranks American Family Insurance very well–in first place for midsize insurers.

American Family Insurance also ranks above average in several regions in the J.D. Power 2021 Auto Insurance Study, including the California, Central, North Central, and Southwest regions.

Bottom Line On Costco Car Insurance

There’s a lot to like about Costco car insurance, from cheap rates to an impressive set of coverage. Costco’s auto insurance provider American Family Insurance is also highly rated in industry studies for its size.

About Costco Car Insurance

Parent insurance company: American Family Insurance
States available: 44 plus Washington, D.C. (unavailable in Alaska, Louisiana, Maine, North Dakota, Rhode Island, and Wyoming)
AM Best financial strength rating: A
Insurance types: Auto, home, renters, umbrella, specialty

Costco stands as the sixth-largest retailer in the world, making over $163 billion in revenue in 2019 alone. While its main focus is on selling goods, the Issaquah, Washington-based company also partners with American Family Insurance to sell Costco car insurance to its members.

Costco car insurance is less expensive than average. Its agreement with American Family Insurance means that customers will likely work with the AmFam customer service team in the event of a claim. Overall, Costco car insurance may be worth a look for Costco members who are on the hunt for the cheapest car insurance possible.

Other Options For Car Insurance

If Costco car insurance isn’t the right choice for you, we recommend comparing car insurance quotes from a few leading providers.

Compare car insurance rates
Answer a few simple questions to save money on your policy

Progressive: Best Usage-Based Insurance

Not every driver has the best record, but they still need auto insurance. Luckily, we found in our Progressive insurance review the company offers cheap, high-quality plans to nearly every type of motorist.

Despite its tendency to insure high-risk drivers, Progressive has established a strong industry reputation and holds an A+ rating for financial strength from AM Best.

Affordable plans can be found using Progressive’s system of usage-based insurance. Instead of paying one flat monthly rate, customers are charged for how often they drive their vehicles. Motorists whose cars aren’t used much could reap significant savings with Progressive.

Geico: Best Overall Provider

In our Geico insurance review, the company stood out as the Best Overall Provider because of how effortlessly it mixes affordable rates with exceptional service. Few auto insurance companies receive as much praise as Geico, a true testament to its customer-focused outlook.

Other providers can sometimes beat Geico’s prices, but usually not by much. With high standards and countless satisfied customers, it’s obvious why Geico is the second-largest car insurance provider in the country.

Frequently Asked Questions: Costco Car Insurance

How We Rate Insurers

Our review process aims to deliver consistent and unbiased assessments of car insurance providers. While there are multiple qualities that make a car insurance company successful, our review team focuses on those we believe are the most important for consumers:

  • Cost: Cost can be difficult to compare between insurers because so many factors impact annual premiums. The cheapest insurer for one driver may not be the cheapest for another. To determine our cost score, we look at insurance rate estimates generated by Quadrant Information Services, discount opportunities, and consumer reports.
  • Coverage: To determine our coverage score, we look at the number of coverage options available as well as coverage limits and deductible options. Our ratings also take into account additional services and benefits like roadside assistance.
  • Reliability: It’s important that an auto insurer is able to meet its claims obligations. Companies with a strong financial strength rating from AM Best score best in this category. Established insurers with a long history of reliable service also receive positive marks.
  • Service: We comb through customer reviews on sites like the Better Business Bureau (BBB) to learn about customer experiences. Insurers with a low volume of complaints score well in this area. We also consider the claims process, giving higher ratings to car insurance providers that offer easy-to-use claims apps.

*Data accurate at time of publication.