Costco Auto Insurance 2022 Review

Costco sells auto insurance policies to its members through Connect by American Family (AmFam). AmFam may apply a policy discount just for being a Costco member plus other savings opportunities by bundling policies, maintaining a clean driving record and more. Costco/AmFam policies are available in only 44 of 50 states and customers need to upgrade their Costco membership at an additional cost for certain auto policy benefits.

Find out if this policy is right for you in our Costco auto insurance review.

Costco Car Insurance Overview

Availability

44 states, plus Washington, D.C.

Pricing

Varies

Coverages

  • Bodily injury liability
  • Property damage liability
  • Collision
  • Comprehensive
  • Uninsured/underinsured motorist
  • MedPay/PIP
  • Collision deductible waiver
  • Uninsured motorist property damage
  • Rental car reimbursement
  • Pet injury

Roadside assistance

Optional

Rideshare coverage

No 

Gap insurance

Yes

Discounts

  • Costco membership
  • Multiple vehicles on single policy
  • Bundle multiple policies
  • Good driver 
  • Premier safety
  • Defensive driver
  • Vehicle safety features
  • Car parked in garage
  • Good student 
  • Student away
  • Tenure/loyalty

Customer support

Customer Service

File a Claim

  • 1-800-872-5246 
  • csc@connectbyamfam.com 

Roadside Assistance: 1-888-742-4572

Mobile app

Car insurance sold by Costco/AmFam is available only to Costco members.

Good for:

Bad for:

Costco members

Drivers without Costco membership

Accident-prone drivers

Drivers in Alaska, Louisiana, Maine, North Dakota, Rhode Island or Wyoming

Costco Car Insurance: Pros & Cons

Pros

Cons

Policy discount for Costco members

Not available in all states

Highest customer satisfaction rating by J.D. Power

Maintaining Costco membership adds to costs

Glass repair deductible waiver at no additional cost

Lifetime renewability requires Costco Executive membership level

Lifetime renewability

 

Lifetime warranty on repairs from approved facility

 

Pros

  • Policy discount for Costco members: American Family may apply a discount on your policy premium when you show proof of an active Costco membership.
  • Highest customer satisfaction rating by J.D. Power: American Family received the highest customer satisfaction score in a J.D. Power 2021 Insurance Shopping Satisfaction Study. The mid-size auto insurer placed first in price, distribution channel, policy offerings and quote process.
  • Glass repair deductible waiver at no additional cost: In a covered accident, your deductible may be waived if your damaged windshield can be repaired instead of replaced. Car accident claims can be costly and a deductible waiver adds those savings back into your pocket.
  • Lifetime renewability: So long as you maintain your Costco Executive membership ($120/yera), AmFam will renew your auto policy regardless of how many claims you file. Other insurance companies will likely refuse to renew your policy if you have too many claims in your history.
  • Lifetime warranty on repairs from approved facility: If you repair your car at an approved facility, you will get a lifetime warranty on repairs for as long as you own the vehicle.

Cons

  • Not available in all states: AmFam writes Costco auto insurance policies in only 44 states and the District of Columbia. Costco/AmFam auto insurance is not available to drivers who live in Alaska, Louisiana, Maine, North Dakota, Rhode Island or Wyoming.
  • Maintaining Costco membership adds to costs: AmFam adds a discount to your policy so long as you maintain your Costco membership. Costing $60 to $120, this is an additional cost you’ll need to manage throughout your auto policy.
  • Lifetime renewability requires Costco Executive membership level: To benefit from lifetime renewability, you will need to purchase a Costco Executive membership ($120/year). This is double the cost of the base-level membership ($60/year).
AmFam may apply a policy discount just for being a Costco member.

What Does Costco Car Insurance Cover?

Costco car insurance coverage includes the standard minimum liability requirements set by your state. You can also purchase full coverage at an additional cost if you want more protection or if you are financing your vehicle.

Type of Coverage

What It Does

Required/Optional*

Bodily injury liability

Pays for other people’s medical bills (e.g., ambulance fees, first aid, surgery) and your legal fees if you are the at-fault driver in a car accident

Required

Property damage liability

Pays for the other property damages (e.g., repair bills) and your legal fees if you are the at-fault driver in a car accident

Required

Comprehensive

Covers non-collision-related damages (e.g., theft, vandalism, collision with deer, falling objects, natural disasters)

Optional

Collision

Covers your property damage losses if you are the at-fault driver in a car accident or suffer a single-car accident (e.g., hitting a mailbox or tree, single-car rollover)

Optional

Medical payments coverage (Medpay)

Pays for your or your passengers’ medical expenses regardless of who was the at-fault driver in a car accident

Optional (not available in all states)

Personal injury protection (PIP)

Pays for your medical expenses, lost wages if you’re unable to return to work and funeral expenses, regardless of who is the at-fault driver in a car accident

Required in some states

Underinsured/uninsured motorist property damage

Pays for your property damage losses if the other driver is the at-fault driver in a car accident but does not have auto insurance or has insufficient coverage

Required in some states

Underinsured/uninsured motorist bodily injury

Pays for your medical expenses if the other driver is the at-fault driver in a car accident but does not have auto insurance or has insufficient coverage

Required in some states

Other Types of Coverage

Costco’s car insurance policies may include certain benefits, like a glass repair deductible waiver. Drivers can also purchase various endorsements at an additional cost.

  • Glass repair deductible waiver (included): If your windshield is damaged in a covered claim and it can be repaired instead of replaced, AmFam will waive your policy deductible.
  • Rental insurance: Purchasing rental coverage will cover the cost to rent a vehicle if your vehicle is undergoing repairs after a covered accident.
  • Gap coverage: Pays for the remaining balance on your auto loan, up to the policy limit, if your car is totaled in a covered accident. Most auto policies only cover your vehicle’s actual cash value, which does not include the value lost from depreciation.
  • New car replacement coverage: Pays to replace your vehicle with the same make and model up to 110% of the manufacturer’s suggested retail price if your vehicle is totaled within the first year of ownership.
  • Accident travel expense coverage: If you get into a car accident more than 100 miles from your home and your car is unusable, this coverage will pay for your out-of-pocket expenses for lodging, meals and transportation.
  • Roadside assistance: A roadside coverage plan can include vehicle towing, battery jumpstarts, locksmith services, fuel delivery and more if your vehicle is stranded at the roadside.
Find Affordable Car Insurance

How Much Does Costco Car Insurance Cost?

Our sample quote for a 30-year-old driver of a 2018 Honda Accord in California was $1,306.88 for a six-month policy ($217.81 per month). This is comparably higher than the average cost in 2019 ($101.62 per month).

The actual cost of a Costco car insurance policy will vary based on multiple factors, including:

  • Your state’s minimum car insurance requirements
  • Increasing your coverage limits
  • Purchasing minimum coverage versus full coverage
  • Adding endorsements to your auto policy
  • Deductible (higher deductible typically results in lower premiums)
  • Application of discounts
  • Vehicle year, make and model
  • Driving/accident history
  • Claims history
  • Annual mileage
  • Location
  • Age
  • Gender (in some states)
  • Whether you park your car in a garage

Costco Membership Fees

Car insurance sold by Costco/AmFam is available only to Costco members. This requires you to purchase a Costco membership, which can range from $60 to $120 depending on what tier you choose. Fortunately, AmFam offers a discount to Costco members plus several other savings opportunities, which can help cut auto insurance costs.

Membership Tier

Annual Fee

Business

$60.00 

Gold Star

$60.00 

Executive

$120.00 

Costco Car Insurance Discounts

Costco members can save on more than just groceries and electronics. Costco/AmFam offers tons of discounts to help their customers save on car insurance.

  • Costco member discount: Just being a Costco member may snag you a discount on your AmFam auto insurance policy.
  • Multi-car discount: Qualify for savings if you register multiple vehicles in a single car policy through Costco/AmFam.
  • Bundling discount: Save money by purchasing more than one type of insurance policy through Costco/AmFam. Costco/AmFam offers insurance for homeowners, renters, flood, specialty (e.g., RVs, boats) and umbrella policies.
  • Good driver discount: Drivers who practice safe driving habits can qualify for a discount if they have no accidents, violations or claims within the last five years (available in California only).
  • Premier safety discount: If all the drivers on your policy, such as a spouse and children, hold spotless driving records free of traffic violations, accidents or claims for the past four years, then you can earn a premier discount.
  • Defensive driver discount: Completing a defensive driving course to refresh safe driving habits (e.g., roadway scanning, right of way rules, safe following distances) can net some savings on your auto policy.
  • Vehicle safety features: Drivers who own vehicles equipped with safety features, such as anti-lock brakes, airbags and anti-theft devices can receive a discount.
  • Garaging discount: Parking in a garage versus on a public street can earn you a policy discount. Garaged vehicles typically have lower chances of experiencing a comprehensive claim, such as theft or damage from natural disasters.
  • Good student discount: Good grades can translate into lower auto insurance premiums if you maintain a minimum GPA.
  • Student away discount: Student drivers who will be 100 miles away from home and no longer driving a vehicle will not fully count toward your auto insurance policy premium. Instead, you may only be charged for coverage on weekends or during school vacation breaks.
  • Tenure discount: Also called a loyalty discount, policyholders will enjoy lower premiums after staying with Costco/AmFam for a certain amount of time.

Other Costco Insurance Products

Take advantage of a bundling discount by purchasing another insurance product alongside car insurance.

  • Homeowners insurance: Gain coverage for your home structure, personal property and more if you are a homeowner.
  • Condo insurance: Gain coverage for your personal property and more if you own a condo unit.
  • Renters insurance: Gain coverage for your personal property and more if you’re renting a unit from a landowner.
  • Specialty insurance: Insure other types of property you own, such as ATVs, motorcycles, RVs, boats, classic cars and rental properties.
  • Flood coverage: Insure your home against flood damages — just one inch of floodwater can cause up to $25,000 in damages according to the National Flood Insurance Program.
  • Umbrella policy: Enjoy additional coverage beyond the limits of your auto, home, condo or renters insurance policy. For example, an umbrella policy may offer an extra $10,000 in coverage if your claim expenses exceed the $15,000 limits of your auto policy.

Optional Endorsements

Costco/AmFam offers additional coverages if you purchase a home or condo insurance policy.

  • Glass repair reimbursement: If one of your home’s windows is broken, your policy may pay up to $1,000 to replace or repair the window. This benefit is included in your dwelling coverage and is limited to two claims within a consecutive 12-month period.
  • Identity theft protection: Protect yourself from fraud, stolen credit cards and other identity theft risks and gain up to $5,000 in recovery costs. Included with home and condo insurance policies as a standard benefit.
  • Food spoilage protection: Food that spoils during a power outage can qualify as a covered loss, up to $500 in value. No deductible will apply.
  • Lock replacement expense protection: Costco/AmFam covers the cost of lock replacements (up to $100) if your home experienced a break-in or burglary.

Customer Service

Costco did not have the greatest scores on review sites Trustpilot and ConsumerAffairs. With below-average scores, some reviews revolved around unsatisfactory customer service. Fortunately, Costco’s auto policies are underwritten by American Family and customers will likely be directed to an AmFam representative to complete the auto insurance purchase.

This is good news because AmFam earned the highest customer satisfaction score among mid-size auto insurers in a J.D. Power 2021 Insurance Shopping Satisfaction Study. Specifically, AmFam took first place in four rating categories: price, distribution channel, policy offerings and quote process. Earning the top spot in these categories suggests a good customer experience when learning about AmFam’s policies before completing the purchase.

You would contact AmFam (not Costco) to file a claim.

American Family, however, has an NAIC complaint index of 1.27, which is not great. A complaint index over 1.0 indicates the insurance company has received more complaints than what is expected based on its size.

Filing a Claim With Costco Car Insurance

Filing a car insurance claim with Costco/AmFam is simple by taking the below steps.

Call 911 if There Are Injuries

Immediately after the accident, check if you, your passenger or the other driver is injured. If anybody sustained an injury, you should call 911 to notify your local authorities.

Exchange Information With the Other Driver

After checking for injuries, you should exchange the following information with the other driver:

  • Name
  • Contact information
  • Driver’s license numbers
  • License plate numbers and VINs
  • Car insurance information (company, contact information and policy number)

Take photographs of the damages (if any) and the accident scene.

Notify American Family

Since AmFam underwrites Costco car insurance policies, you would contact AmFam (not Costco). A representative will take down your information and record the details of the accident. Next, a claims adjuster will contact you within one business day to request more information about the accident. Your claims adjuster will request documentation regarding the accident, including a copy of the policy report and before and after photos of your vehicle.

Choose a Repair Facility

Your claims adjuster will provide you with a list of approved repair facilities if your car requires any repairs. If you add rental coverage when buying your auto policy, rental car costs will be covered up to the policy limit while your car is undergoing repairs (generally, the rental car company will bill AmFam directly). Choosing an approved repair facility includes a lifetime warranty on repairs for as long as you own the vehicle.

Methodology

Our sample six-month quote was for John, a 30-year-old male who drives a 2018 Honda Accord. John has a clean driving record and is seeking a full coverage policy with the following limits:

  • Liability: $25,000/$50,000/$25,000

  • Uninsured/underinsured motorist: $25,000/$50,0000

  • $500 comprehensive deductible

  • $500 collision deductible

The following discounts were applied to reduce the policy premium:

  • Airbags

  • Anti-theft device

  • Costco member

  • Good driver

  • Premier safety

FAQs

Does Costco sell home and auto insurance?

Yes, Costco sells both homeowners insurance and auto insurance (policies are underwritten by American Family). Purchasing both types of policies can qualify you for a bundling discount.

What are the benefits of Costco insurance?

Costco insurance policies are underwritten by American Family and customers may qualify for a policy discount just by being a Costco member. Costco/AmFam also offers discounts for purchasing multiple insurance policies, being a good student, taking a defensive driving course and more.

Does Costco offer other types of insurance?

Costco sells several types of insurance policies through American Family, including homeowners, renters, condo and flood insurance. Costco/AmFam also sells umbrella policies and specialty coverage for motorcycles, RVs, boats and rental properties.

Key Takeaways

  • Discounted auto insurance policies underwritten by American Family are available to Costco members.
  • Costco/AmFam policies include a glass repair deductible waiver if your windshield is damaged in a covered claim and can be repaired instead of replaced plus lifetime renewability for Costco Executive members.
  • Costco members can purchase auto insurance endorsements, including rental car insurance, roadside assistance and gap coverage.
  • AmFam offers multiple types of car insurance discounts to Costco members, including a Costco member discount, multi-car discount, loyalty discount and a good driver discount.
  • Purchasing another AmFam insurance policy alongside your auto insurance policy, such as homeowners/renters/condo insurance may qualify you for a bundling discount.

Not a Costco member? The discount AmFam offers being a Costco member can be significant but no worries if you don’t hold a membership. SmartFinancial can help you explore alternative solutions to insuring your car at low prices. Based on your answers to a few questions, we analyze national and local insurance carriers in your area to match you with the perfect auto policy. Just enter your zip code below or call 855.214.2291 to receive your free car insurance quotes.

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