Costco Insurance Review

  • With 2/5 stars in 2024, Costco is a below average insurance company.
  • Read Costco reviews, complaints and prices before you buy.
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Ross Martin

Insurance Writer

  • 4+ years in the Insurance Industry

Ross joined The Zebra as a writer and researcher in 2019. He specializes in writing insurance content to help shoppers make informed decisions.

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Mark Friedlander

Director, Corporate Communications, Insurance Information Institute

Mark Friedlander has over 30 years of experience in the insurance industry. He is the Director, Corporate Communications, at the Insurance Informatio…

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Kristine Lee

Insurance Analyst

  • Licensed Insurance Agent — Property and Casualty
  • 4+ years of Experience in the Insurance Industry

Kristine is a licensed insurance agent who joined The Zebra in 2019 as an in-house content researcher and writer. Before joining The Zebra, she was a…

Costco insurance: Ratings and reviews

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Rating from The Zebra Question mark icon

While Costco does not technically sell car insurance, the store offers its members discounts on homeowners, auto, and umbrella insurance policies through CONNECT, powered by American Family Insurance. Costco advertises savings of up to $581, and CONNECT provides benefits such as roadside assistance and lifetime renewability. In order to gauge whether or not Costco auto insurance is a good deal, we compared Costco member insurance rates to rates from top insurance companies.

While Costco insurance may be cheaper, it comes with some caveats. Therefore, it's important to weigh your options carefully when deciding if it's the best deal for you.

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2 stars Rating from The Zebra
Ratings based on price, customer service, coverage, and financial strength.
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  • A wide range of coverage options and benefits

  • Affordable premiums

  • An option for non-cancellation for Executive Membership holders

  • Good bundling options

  • Limited availability

  • Poor customer service ratings

  • Must be a Costco member to be eligible

Is Costco a good insurance company?

The majority of The Zebra's review incorporates how well Costco (CONNECT by American Family Insurance) scores in terms of customer service. In order to determine that we looked at the following third-party ratings. Where available, we use CONNECT's ratings. In the event they are not available, we rely on those of American Family as CONNECT is a subsidiary.

Trustpilot: 4.5*

  • Costco (American Family) earned 4.5 marks in J.D. Power's most recent auto claims satisfaction study[1]

Better Business Bureau: 1.27

  • The BBB rated Costco (American Family CONNECT) as 1.27 in overall auto customer satisfaction[2]

Complaint Index: Above average

  • The National Association of Insurance Commissioners (NAIC) receives Above average customer complaints for Costco (American Family CONNECT)[3]

Financial Strength: A (Excellent)

  • American Family CONNECT received an A (Excellent) financial strength rating from A.M. Best for its ability to pay out claims[4]

*ratings are based on American Family Insurance

The Zebra Customer Satisfaction Survey

In addition to third-party ratings, we also incorporated the results from our own consumer survey where we ranked which car insurance companies are the best based on feedback from real customers. However, Costco's carrier, CONNECT didn't receive enough direct responses, though its parent group, American Family Insurance scored 8.68/10 overall.*

*We did not figure this score into the overall review.

How much does Costco insurance cost?

Currently, the national average for a 6 month car insurance policy is $880, whereas Costco (AmFam Connect) is about $534, or roughly $346 less than a typical policy, so definitely one of the cheapest auto insurance options available.

The table below shows how Costco's auto insurance compares against other top insurers. 

Average Monthly Cost by Insurance Carrier
Car Insurance Company Average Annual Premium
Allstate $2,022
Farmers $2,790
GEICO $1,494
Nationwide $1,476
Progressive $1,482
State Farm $1,480
USAA $1,214
Costco Car Insurance (CONNECT) $1,068

The Zebra’s Dynamic Insurance Rating Tool data methodology

The Zebra’s Dynamic Insurance Rating Tool for home and auto insurance rates utilizes the latest ZIP code-level rate filings from across the U.S., sourced from Quadrant Information Services and S&P Global. These filings, typically updated annually or biennially by insurers, are verified through Quadrant’s QA process and then integrated into The Zebra’s estimator.

The displayed rates are based on a dynamic home and auto profile designed to reflect the content of the page. This profile is tailored to match specific factors such as age, location, and coverage level, which are adjusted based on the page content to show how these variables can impact premiums.

For a comprehensive understanding, see our detailed methodology.

Discounts offered

Auto insurance discounts are dependent on certain qualifications and state availability. Below are some of the ways you can lower your monthly rate for Costco. 

  • Multi-policy - if you bundle another policy with your auto insurance, such as a Costco home or condo policy, you can earn a multi-policy discount. Rates for such bundles tend to save 5 - 15% on average
  • Multi-vehicle - Costco insurance rewards multi-vehicle customers with a discount 
  • Continuous coverage - insurers see drivers with long insurance history as safe drivers. As such, Costco insurance will reward you for your consistent insurance coverage with its own discount
  • Garaging discount - While limited, you may be able to snag a discount from Costco insurance if you park your vehicle in a garage overnight

In addition to what's listed above, Costco offers other driver-based discounts including good student and student away from home, as well as discounts for safety features and good driving. View all of the discounts that Costco (AmFam Connect) offers here.

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What types of coverage does Costco offer?

Another key component of Costco's review is the types of coverage options they offer.

Costco (Connect by American Family) provides all state-specific and basic coverage options you might need, including liability, collision, comprehensive, and uninsured/underinsured motorist coverages. Below are some of Costco's custom coverage options and perks the company offers.

  • Bundling options - In addition to homeowners and renters policies, Costco offers several other types of insurance that may be bundled together including boat, motorcycle, RV, condo, and even pet insurance. View the full list of Costco products here.
  • Roadside assistance - Costco's roadside assistance coverage a number of services if you find yourself broken down.
  • Windshield coverage - Coscto includes a Glass Repair Deductible Waiver for no additional cost.
  • Accident Travel Expense Coverage - If you are in an accident while traveling, Costco's coverage provides assistance with travel-related fees that accumulate as a result.

Read more about Costco's coverages here.

Real-life customer experience

In an effort to provide even more insight into the Costco customer experience, we reached out to The Zebra's employees to see who has used Costco as their own personal carrier. Below is what one customer, Ryan, had to say.

Quick facts:

  • Customer for 3-5 years
  • Only has an auto policy
  • Has never filed a claim

Costco insurance review: Summary

In short, Costco (Connect by American Family) is a good choice for eligible customers. The company's vast coverage choices, good rates and bundling options give customers a lot of choice in how they package their coverage. Overall, The Zebra believes that Costco is a great option for a large swath of insurance shoppers.

Methodology — how The Zebra reviews insurance companies

The team of insurance experts at The Zebra considers the company's standing in five main categories to come up with an overall rating. These metrics are weighted according to importance and are detailed below:

  • Price (20%): Using the base profile detailed below, we compared the company's average rate with the national average. If it surpassed this average, we gave a lower rating; if it fell below, we awarded a higher rating.
  • Coverage (20%): The highest-scoring companies offer a variety of coverage options, including bundling options, roadside assistance, telematics, beyond-basic coverage levels, and a variety of other coverage types.
  • Customer service (30%): We averaged ratings from JD Power, the NAIC complaint index to come up with a rating for the company's customer service. In instances when a company is not rated, we may use alternative rating agencies such as the Better Business Bureau and Trust Pilot.
  • Financial strength (10%): We use AM Best to determine a company's financial standing. In some cases when a company is not rated by AM Best, we may use an alternative measure such as Demotech.
  • The Zebra's Customer Satisfaction Survey (20%): The Zebra conducts an annual survey measuring customer satisfaction for many of the top insurance companies with the goal of ranking both the best auto insurance companies and best home insurance companies. Read more below.

For our auto insurance review, we analyzed more than 83 million insurance rates spanning every U.S. ZIP code using a sample user profile: a 30-year-old single male driver with a Honda Accord, good credit and full coverage at these levels:

  • $50,000 per person/$100,000 per incident for bodily injury liability
  • $50,000 per incident for property damage liability
  • $500 deductibles for collision and comprehensive coverage

For our home insurance review, rates are based on a sample user profile: a 45-year-old married homeowner living in a 2,500-square-foot single-story home built in 2011 with these coverage levels:

  • $200,000 for the dwelling
  • $20,000 for other structures
  • $100,000 for personal property
  • $100,000 for personal liability
  • $1,000 deductible

These sample premiums are dynamic and automatically refresh whenever the newest data is made available.

To generate pricing for particular rating factors, we adjusted this profile based on common pricing factors used by major car insurance companies. These factors include credit score, coverage level and others.

For The Zebra's Customer Satisfaction Survey, findings are based on an online quantitative survey of 4,134 current U.S. auto and home insurance customers, with Census-balanced sampling by age, gender and region. Categories with n=<20 responses are considered insufficient sample size and are not reported. This survey was developed by The Zebra and executed by independent research firm Maru/Blue in 2023.

Costco insurance: Frequently asked questions

Costco works with Connect by American Family Insurance to provide auto, home and umbrella coverage to its members.

Non-members can buy insurance coverage through Connect, but they may not be eligible for some of the savings and other perks that are available to Costco members.

Costco car insurance is cheaper on average, coming in at $534 for a six-month policy versus the national average of $880. Remember that this is subject to a variety of factors so your rates may well be different.

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About The Zebra

The Zebra is not an insurance company. We publish data-backed, expert-reviewed resources to help consumers make more informed insurance decisions.

  • The Zebra’s insurance content is written and reviewed for accuracy by licensed insurance agents.
  • The Zebra’s insurance editorial content is not subject to review or alteration by insurance companies or partners.
  • The Zebra’s editorial team operates independently of the company’s partnerships and commercialization interests, publishing unbiased information for consumer benefit.
  • The auto insurance rates published on The Zebra’s pages are based on a comprehensive analysis of car insurance pricing data, evaluating more than 83 million insurance rates from across the United States.