DOES COSTCO DO AUTO INSURANCE

Yes, Costco does offer auto insurance, but not directly through Costco itself. Instead, they partner with reputable insurance providers to offer exclusive discounts and benefits to their members. This guide explores the Costco auto insurance program, its advantages, how it works, and whether it's the right choice for your needs.

Costco Auto Insurance: An Overview

Costco, a name synonymous with bulk savings and member-exclusive deals, extends its philosophy of value to auto insurance. While Costco Wholesale Corporation doesn't underwrite policies directly, they facilitate access to auto insurance through strategic partnerships with established insurance carriers. This program, often branded as "Connect, powered by Costco" or similar, aims to leverage Costco's vast membership base to negotiate competitive rates and exclusive benefits for its members. The primary goal is to offer a streamlined, cost-effective, and reliable auto insurance solution that aligns with Costco's reputation for quality and value. For many Costco members, the allure lies in the potential for savings and the trust associated with the Costco brand, making it a compelling option to explore when seeking new auto insurance coverage. The program is designed to be transparent, allowing members to understand the value proposition clearly before committing.

How Does Costco Auto Insurance Work?

The Costco auto insurance model operates on a partnership basis. Costco collaborates with select insurance companies that meet their stringent criteria for financial stability, customer service, and competitive pricing. These partner companies then offer auto insurance policies to Costco members, often at discounted rates or with added benefits not available to the general public. When a Costco member expresses interest in auto insurance, they are typically directed to the designated partner provider. This might involve visiting a specific website, calling a dedicated phone line, or using a specialized portal. The process usually begins with a quote request, where the member provides details about their driving history, vehicle, desired coverage levels, and Costco membership number. The partner insurer then assesses this information and presents a personalized quote, highlighting any Costco member-specific advantages. It's crucial to understand that the actual insurance policy is underwritten and managed by the partner insurance company, not Costco. Costco's role is primarily that of a facilitator and a negotiator of member benefits. This structure allows Costco to offer a valuable service without becoming an insurance underwriter, a complex and highly regulated industry. The partnership ensures that members receive coverage from established, reputable insurers while still benefiting from the Costco affiliation.

The Role of Costco

Costco's involvement is multifaceted. Firstly, they leverage their massive membership base to negotiate favorable terms with insurance providers. This bulk buying power translates into potential savings for members. Secondly, Costco vets its insurance partners rigorously. This vetting process typically includes assessing the insurer's financial strength (e.g., A.M. Best ratings), customer satisfaction scores, claims handling efficiency, and overall reputation. This ensures that members are dealing with reliable and reputable companies. Thirdly, Costco often provides a dedicated platform or service to connect members with these partners, simplifying the search and quoting process. This can include online portals or specialized customer service lines. Costco's brand equity adds a layer of trust, assuring members that the recommended partners are likely to offer a high standard of service and value. They act as a trusted intermediary, simplifying a potentially complex decision for their members.

The Role of the Partner Insurer

The partner insurance company is the entity that actually underwrites, issues, and services the auto insurance policies. They are responsible for:

• Assessing risk and determining premiums.
• Providing the various coverage options (liability, collision, comprehensive, etc.).
• Handling claims processing and payouts.
• Managing policy renewals and changes.
• Providing customer service for policy-related inquiries.

These insurers are licensed and regulated entities with their own established track records and operational procedures. The partnership with Costco allows them to access a large pool of potential customers and to offer competitive pricing as a result of the negotiated terms.

Key Benefits of Choosing Costco Auto Insurance

The Costco auto insurance program offers several compelling advantages for its members, primarily centered around cost savings and enhanced service. These benefits are designed to make the insurance purchasing process more attractive and potentially more affordable.

Exclusive Member Discounts

One of the most significant draws is the potential for exclusive discounts. Costco negotiates with its partner insurers to offer rates that are often lower than what non-members might receive. These discounts can be applied in various ways, such as a general member discount, or through specific programs offered by the partner insurer that are extended to Costco members. For instance, some programs might offer discounts for safe driving, multi-car policies, or bundling with other insurance products. The exact nature and extent of these discounts can vary depending on the partner insurer and the specific policy chosen.

Access to Reputable Insurers

Costco's rigorous vetting process ensures that members are connected with financially stable and reputable insurance companies. This provides peace of mind, knowing that the insurer is likely to be able to handle claims efficiently and effectively. Companies are typically selected based on strong financial ratings (e.g., A.M. Best ratings of A or higher) and positive customer service feedback. This eliminates much of the guesswork and risk associated with choosing an unknown insurer.

Streamlined Quoting Process

Costco often provides a centralized platform or dedicated service to facilitate the quoting process. This can simplify what is often a time-consuming task. Members can typically get a quote online or over the phone by identifying themselves as Costco members. This streamlined approach saves time and effort, making it easier to compare options and find suitable coverage.

Potential for Bundling Savings

Many of Costco's partner insurers offer opportunities to bundle auto insurance with other types of coverage, such as homeowners, renters, or even umbrella policies. Bundling can often lead to additional discounts, further reducing the overall cost of insurance for members who hold multiple policies with the same provider. This integrated approach can also simplify policy management.

Member Advocacy and Support

While the insurance policy is managed by the partner insurer, Costco's involvement can sometimes extend to a level of member advocacy. If a member encounters issues with their insurance provider, Costco's relationship with the partner might offer an avenue for escalation or assistance, although this is not a primary function. The brand's commitment to member satisfaction often means they will work to ensure their partners are meeting expectations.

Additional Benefits

Depending on the specific partner insurer, Costco members might gain access to additional perks. These could include things like:

• Roadside assistance programs.
• Accident forgiveness options.
• New car replacement coverage.
• Discounts on auto maintenance or repairs through affiliated networks.

These extra benefits can add significant value beyond just the base insurance coverage.

Understanding the Partnerships: Who Provides the Insurance?

Costco's auto insurance program is not a monolithic offering; it relies on partnerships with different insurance carriers across various regions and over time. This means that the specific insurance company providing coverage to a Costco member can vary. Historically, and currently in many markets, the primary partner has been American Family Insurance through its subsidiary, The General, or through direct offerings under the American Family umbrella. In other regions, Costco has partnered with providers like Olympia Benefits or other regional carriers. It's essential for members to verify which insurer is currently partnered with Costco in their specific geographic location and for their particular needs. The branding might also differ; for example, it might be advertised as "Connect, powered by Costco" or similar.

Key Partner Insurers and Their Strengths (Examples)

While partnerships can evolve, understanding the typical providers and their strengths is beneficial.

American Family Insurance / The General

American Family Insurance is a well-established national insurance company known for its strong financial ratings and comprehensive product offerings. The General, often associated with American Family, is known for its focus on non-standard auto insurance, but also offers standard coverage. When partnering with Costco, American Family typically offers a range of coverage options and competitive pricing, often with specific member discounts. Their strengths include a wide network of agents, robust online tools, and a reputation for reliable claims handling. For 2025, American Family continues to be a prominent partner in many states, offering a blend of traditional insurance values with Costco's member benefits.

Olympia Benefits

Olympia Benefits is another company that has been associated with Costco's insurance programs, sometimes focusing on specific types of coverage or member segments. Their offerings can vary, but they often aim to provide competitive rates and specialized benefits tailored to the Costco membership.

Regional Partners

In some instances, Costco may partner with regional insurance carriers that have a strong presence and competitive offerings within a specific state or group of states. These partnerships allow Costco to tailor its insurance program to local market conditions and regulatory environments, potentially offering even more localized value.

How to Identify Your Partner Insurer

The best way to identify the current partner insurer in your area is to:

• Visit the official Costco Services website (CostcoServices.com) and navigate to the auto insurance section.
• Look for specific branding like "Connect, powered by Costco."
• When you initiate a quote, the name of the underwriting insurance company will be clearly displayed.
• Contact Costco member services directly for clarification if you are unsure.

It is crucial to confirm the underwriting company, as this is the entity that will be responsible for your policy.

Eligibility Requirements for Costco Auto Insurance

To take advantage of the Costco auto insurance program, you must meet certain eligibility criteria. The most fundamental requirement is being an active Costco member. Beyond that, standard auto insurance eligibility rules apply.

Active Costco Membership

This is the primary prerequisite. You must hold a valid, paid Costco membership. This applies to all eligible members of the household who will be listed on the policy. If your membership lapses, you may lose access to the program's benefits and potentially face changes to your policy or rates.

Driver Eligibility

Standard insurance regulations dictate driver eligibility. This typically includes:

• Minimum age requirements (usually 16 or 18, depending on the state).
• A valid driver's license.
• A clean driving record is highly preferred, though some insurers offer options for drivers with minor infractions.
• Insurers will assess the driving history of all individuals listed on the policy, including past accidents, tickets, and DUIs.

Vehicle Eligibility

The program generally covers most standard passenger vehicles, including cars, SUVs, and minivans. Coverage for motorcycles, RVs, classic cars, or commercial vehicles may be available through specific partners or may be excluded. The partner insurer's underwriting guidelines will determine the specific types of vehicles they insure.

Geographic Location

Auto insurance is state-regulated, meaning coverage availability and specific offerings can vary significantly by location. The Costco auto insurance program, through its partners, is available in most U.S. states, but there might be exceptions. It's essential to check if the program is offered in your specific state.

Coverage Needs

While not strictly an eligibility requirement, your insurance needs will influence whether the program is a good fit. The partner insurers will offer standard coverage types, but if you require highly specialized coverage not commonly offered, you might need to look elsewhere.

Coverage Options and Features

The auto insurance policies offered through Costco's partnerships typically include a comprehensive suite of coverage options designed to meet various needs and comply with state legal requirements. The specific options and their availability can depend on the underwriting partner insurer and your location.

Liability Coverage

This is a mandatory coverage in almost all states and protects you financially if you are found at fault in an accident that causes injury or property damage to others. It typically includes:

• Bodily Injury Liability: Covers medical expenses, lost wages, and legal fees for others injured in an accident you cause.
• Property Damage Liability: Covers the cost of repairing or replacing property (like other vehicles or structures) damaged in an accident you cause.

Collision Coverage

This coverage helps pay for repairs to your own vehicle if it's damaged in a collision with another object (like a car or a pole) or if it overturns, regardless of who is at fault. A deductible usually applies.

comprehensive coverage

Also known as "other than collision" coverage, this helps pay for damage to your vehicle caused by events other than a collision. This includes theft, vandalism, fire, natural disasters (hail, flood, wind), and falling objects. A deductible typically applies.

Uninsured/Underinsured Motorist (UM/UIM) Coverage

This coverage protects you if you're involved in an accident with a driver who has no insurance (uninsured) or not enough insurance (underinsured) to cover your damages. It can cover medical expenses, lost wages, and sometimes vehicle repairs.

Medical Payments (MedPay) / Personal Injury Protection (PIP)

These coverages help pay for medical expenses for you and your passengers, regardless of fault, after an accident. PIP is broader and may also cover lost wages and other related expenses. Availability and requirements vary by state.

Optional Coverages and Add-ons

Depending on the partner insurer, you may have access to additional coverage options such as:

• Rental Reimbursement: Covers the cost of a rental car while your vehicle is being repaired after a covered claim.
• Roadside Assistance: Provides help with towing, flat tires, dead batteries, and lockouts.
• Accident Forgiveness: Prevents your rates from increasing after your first at-fault accident.
• New Car Replacement: If your new car is totaled, this coverage can help you replace it with a brand-new vehicle of the same make and model.
• Gap Insurance: Covers the difference between what you owe on your car loan or lease and its actual cash value if it's totaled.

2025 Statistics on Coverage Trends

For 2025, trends indicate a continued demand for comprehensive and collision coverage, especially as vehicle values remain high and the cost of repairs increases. According to industry analyses, approximately 85% of drivers carry collision coverage, and 80% carry comprehensive coverage. The uptake of optional coverages like rental reimbursement and roadside assistance is also growing, with over 60% of drivers opting for at least one of these add-ons for added convenience and protection. Uninsured motorist coverage remains a critical component, with state mandates and consumer awareness driving its adoption, though a significant percentage of drivers still remain uninsured or underinsured.

Comparing Costco Auto Insurance to Competitors

To determine if Costco auto insurance is the best option, it's essential to compare it against other leading auto insurance providers. The comparison should focus on price, coverage options, customer service, financial stability, and member-specific benefits.

Costco Auto Insurance vs. Major National Insurers (e.g., GEICO, Progressive, State Farm)

Costco Auto Insurance:

• Pros: Potential for exclusive member discounts, access to reputable insurers, streamlined quoting process, bundled savings opportunities.
• Cons: Availability varies by region, partner insurers may not always be the cheapest for every driver profile, coverage options might be limited by the partner.

Major National Insurers:

• Pros: Wide availability, diverse range of coverage options, often competitive pricing for various driver profiles, extensive agent networks (for some), robust online tools.
• Cons: Lack of Costco-specific member benefits, may require more effort to find the best deal across multiple providers.

Costco Auto Insurance vs. Warehouse Club Competitors (e.g., Sam's Club)

While Sam's Club also offers insurance programs through partnerships, the specific providers and benefits differ. Costco's program is generally well-regarded for its partnerships with established insurers like American Family. The key is to compare the specific offerings from each club's partners in your region.

Costco Auto Insurance vs. Online-Only Insurers (e.g., Root, Metromile)

Online-only insurers often leverage telematics (usage-based insurance) or focus on technology to offer potentially lower rates, especially for low-mileage or safe drivers.

Comparison Table (Illustrative - 2025 Data)

Feature	Costco Auto Insurance (via Partner)	Major National Insurer (e.g., State Farm)	Online-Only Insurer (e.g., Root)
Price Potential	Competitive, especially with member discounts.	Varies widely; can be competitive for many profiles.	Potentially lower for low-mileage/safe drivers; usage-based.
Coverage Breadth	Standard to good; depends on partner.	Very broad; many optional coverages.	Standard; may have limitations on certain options.
Customer Service	Generally good, via partner insurer.	Varies; strong agent networks for some.	Primarily online/app-based; can be less personal.
Member Benefits	Exclusive Costco member discounts.	Standard loyalty programs, multi-policy discounts.	Focus on tech-driven savings.
Ease of Quoting	Streamlined via Costco portal.	Varies; online, phone, agent.	Primarily online/app.

Key Considerations for Comparison:

• Your Driving Profile: Are you a low-mileage driver? Do you have a perfect record? Your profile heavily influences which insurer offers the best rates.
• Your Vehicle: The make, model, and age of your car can impact premiums.
• Your Location: State regulations and local risks play a significant role.
• Coverage Needs: Ensure the provider offers all the coverages you deem necessary.
• Customer Service Preference: Do you prefer online self-service, phone support, or an in-person agent?

In 2025, the auto insurance market remains dynamic. While Costco's program offers a compelling value proposition through its partnerships, it's always wise to get quotes from multiple sources to ensure you're getting the most competitive rate and the best coverage for your specific situation.

Getting a Quote and Enrolling

The process of obtaining a quote and enrolling in Costco auto insurance is designed to be straightforward for members. It leverages Costco's existing infrastructure and its partnerships with insurance providers.

Step-by-Step Guide to Getting a Quote:

1. Verify Your Costco Membership: Ensure you have an active Costco membership. You will likely need your membership number.
2. Visit the Official Costco Services Portal: Navigate to CostcoServices.com or the specific auto insurance landing page provided by Costco. Look for branding like "Connect, powered by Costco."
3. Initiate the Quote Process: Click on the "Get a Quote" or similar button. You will be directed to the website of the current partner insurance provider.
4. Provide Personal Information: You will need to provide details about yourself, including your name, address, date of birth, and contact information.
5. Enter Driver Information: List all drivers who will be covered under the policy, including their driver's license numbers, driving history (accidents, tickets), and relationship to you.
6. Detail Your Vehicle(s): Provide information about the vehicle(s) you want to insure, including make, model, year, VIN (Vehicle Identification Number), and current mileage.
7. Specify Coverage Needs: Select the types of coverage you want (liability, collision, comprehensive, etc.) and the desired coverage limits. You can often use online tools to help you understand recommended levels based on your state's requirements and your personal preferences.
8. Review and Customize: The system will generate an initial quote based on your inputs. You may have the option to adjust deductibles, coverage limits, or add optional coverages to fine-tune the quote.
9. Apply Costco Member Benefits: Ensure that any applicable Costco member discounts are applied. The quoting system should automatically recognize you as a Costco member and apply relevant savings.
10. Compare Quotes: If you are comparing options, save your quote details. It's advisable to get quotes from at least 2-3 other providers to ensure you're getting the best overall value.

Enrolling in a Policy

If you are satisfied with the quote provided through the Costco program:

1. Proceed to Enrollment: Follow the prompts on the insurer's website or through the phone service to officially purchase the policy.
2. Provide Payment Information: You will need to provide payment details for your down payment or first premium installment. Various payment plans (monthly, semi-annually, annually) are usually available.
3. Review Policy Documents: Carefully read through the policy declarations page and all accompanying documents to ensure you understand your coverage, terms, conditions, and exclusions.
4. Receive Proof of Insurance: Once enrolled, you will receive your insurance ID cards and policy documents, typically via email or mail. You can then update your vehicle registration and provide proof of insurance as required.

Tips for a Smooth Quoting Process:

• Have Information Ready: Gather your driver's license numbers, vehicle information (VINs), current insurance policy details (if applicable), and Costco membership number before starting.
• Be Accurate: Provide honest and accurate information. Inaccuracies can lead to incorrect quotes or issues with your policy later.
• Understand Coverage Levels: If you're unsure about coverage limits, consult the insurer's resources or speak with a representative. State minimums are often insufficient for adequate protection.
• Ask Questions: Don't hesitate to ask the insurance representative any questions you have about the policy, discounts, or coverage options.

The enrollment process is typically completed online or over the phone, offering flexibility to members.

Potential Drawbacks and Considerations

While the Costco auto insurance program offers attractive benefits, it's important to be aware of potential drawbacks and considerations to make an informed decision.

Not Always the Cheapest Option

Despite the promise of member discounts, Costco auto insurance, through its partners, is not guaranteed to be the cheapest option for every individual. Insurance rates are highly personalized, depending on numerous factors like driving history, location, vehicle type, credit score (in some states), and coverage choices. For some drivers, particularly those with specific risk profiles (e.g., young drivers, those with recent accidents), other insurers might offer more competitive pricing. It's always recommended to compare quotes from multiple providers.

Dependence on Partner Insurers

The quality of service, claims handling, and overall customer experience are dictated by the partner insurance company, not Costco directly. While Costco vets its partners, the day-to-day interactions and policy management are solely with the insurer. If a member has a negative experience with the partner insurer, Costco's ability to intervene may be limited.

Limited Choice of Insurers

Costco partners with a select few insurance companies. This means members are not choosing from the entire spectrum of insurance providers available in the market. If the offerings or service of the current Costco partner don't align with your preferences, you might miss out on better options elsewhere.

Geographic Limitations

As mentioned, the program's availability and the specific partner insurers can vary by state. If the program isn't offered or competitive in your particular region, it won't be a viable option.

Potential for Rate Increases

Like all insurance policies, rates are subject to change. A good rate at the time of initial purchase doesn't guarantee the same rate upon renewal. Factors such as increased claims in your area, changes in your driving record, or shifts in the insurer's pricing models can lead to rate increases.

Complexity of Partnership Models

While Costco aims to simplify the process, understanding the nuances of the partnership model can sometimes be confusing. Members need to remember they are dealing with an insurance company that happens to have a partnership with Costco, rather than Costco itself providing the insurance. This distinction is important for understanding policy terms and customer service channels.

Availability of Niche Coverages

While standard coverage options are generally robust, if you require highly specialized insurance (e.g., for exotic cars, classic vehicles, or unique business use), the partner insurers might not offer these niche products. In such cases, seeking out specialized insurers would be necessary.

Is Costco Auto Insurance Right for You?

Deciding whether Costco auto insurance is the right choice involves weighing its benefits against your individual needs and circumstances. It's not a one-size-fits-all solution, but for many Costco members, it presents a compelling value proposition.

Who Might Benefit Most:

• Costco Loyalists: If you are a dedicated Costco member who values the brand and its commitment to member benefits, exploring their auto insurance program is a natural extension of that loyalty.
• Budget-Conscious Shoppers: Individuals and families looking for competitive pricing and potential savings will find the exclusive member discounts attractive.
• Those Seeking Simplicity: The streamlined quoting process and the assurance of dealing with a vetted, reputable insurer can simplify the often-daunting task of shopping for car insurance.
• Drivers with Good Records: Drivers with clean driving histories and stable financial profiles often qualify for the best rates and discounts, making them prime candidates for programs like Costco's.
• Members Looking to Bundle: If you already have other insurance policies (home, renters) with a Costco partner insurer, bundling can lead to significant additional savings.

Who Might Want to Look Elsewhere:

• Drivers with Poor Records: While some partner insurers may offer options for drivers with past issues, those with multiple tickets, accidents, or DUIs might find more specialized high-risk auto insurance providers to be a better fit.
• Those Needing Highly Specialized Coverage: If you own a classic car, exotic vehicle, or require coverage for commercial purposes, you may need to seek out insurers specializing in these niche markets.
• Drivers Prioritizing Specific Insurer Features: If you have a strong preference for a particular insurer not partnered with Costco, or if you value a specific type of customer service (e.g., extensive local agent network) that the partner doesn't offer, you might look elsewhere.
• Price-Sensitive Individuals Who Haven't Compared: Simply assuming Costco's program is the cheapest without getting quotes from other providers is a mistake. Always compare rates from at least three different companies.

Final Recommendation:

The Costco auto insurance program is a valuable resource for its members, offering a blend of potential savings, access to reputable insurers, and a simplified shopping experience. However, it is not a universal solution. The most effective strategy is to treat it as one option among many.

Actionable Advice:

1. Always Get a Quote: As an active Costco member, you have nothing to lose by getting a quote through their program.
2. Compare Thoroughly: Simultaneously obtain quotes from at least two or three other leading insurance providers.
3. Evaluate Total Value: Consider not just the price but also the coverage options, deductibles, customer service reputation, and financial stability of each insurer.
4. Read the Fine Print: Understand the terms, conditions, and exclusions of any policy you are considering.

By following these steps, you can leverage your Costco membership to potentially secure great auto insurance rates while ensuring you choose the policy that best fits your unique needs and budget in 2025 and beyond.

In conclusion, the question "Does Costco do auto insurance?" is answered with a nuanced "yes." While Costco itself doesn't underwrite policies, its strategic partnerships provide members with access to competitive auto insurance options through established carriers. The program's strengths lie in its potential for exclusive member discounts, the assurance of dealing with vetted insurers, and a streamlined quoting process. However, it's crucial for consumers to remember that these policies are provided by third-party insurance companies, and the best option for any individual will depend on their specific driving profile, coverage needs, and geographic location. Thorough comparison shopping, even when using a member benefit program, remains the cornerstone of finding the most suitable and cost-effective auto insurance.