HOW GOOD IS COSTCO AUTO INSURANCE

Costco Auto Insurance, powered by Connect, aims to offer competitive rates and member benefits. This guide explores its coverage options, pricing, customer service, and overall value to help you determine if it's a good fit for your needs in 2025.

What is Costco Auto Insurance?

Costco Auto Insurance is not a direct insurance provider in the traditional sense. Instead, Costco partners with various insurance companies to offer auto insurance policies to its members. For many years, the primary partner was American Family Insurance, but as of 2024, the program transitioned to being powered by Connect, a subsidiary of Liberty Mutual. This means that while you access the insurance through Costco's platform, the actual underwriting, policy management, and claims handling are managed by Connect. The appeal for Costco members lies in the potential for exclusive discounts and a streamlined purchasing process facilitated by Costco's brand trust and member loyalty programs. The goal is to leverage Costco's purchasing power to negotiate competitive rates and potentially offer enhanced benefits to its members, making it an attractive option for those already invested in the Costco ecosystem. In 2025, this partnership continues to evolve, aiming to provide a robust and value-driven auto insurance solution.

Understanding the Connect Partnership

The partnership between Costco and Connect is central to understanding Costco Auto Insurance. Connect, a brand of Liberty Mutual Insurance, is the underwriter and administrator of the auto insurance policies offered through Costco. This means that while Costco members benefit from the association, the insurance itself is provided by Connect. Connect is known for offering a range of insurance products and has a history of working with affinity groups to provide tailored insurance solutions. For Costco members, this partnership translates into potential advantages such as:

• Exclusive Member Discounts: Access to special pricing or discounts not available to the general public.
• Streamlined Quoting Process: A user-friendly system designed to make obtaining a quote efficient for Costco members.
• Leveraging Costco's Brand Trust: The association with a reputable brand like Costco can provide a sense of security and reliability.

In 2025, this relationship signifies a commitment to providing Costco members with a reliable insurance option. Connect's infrastructure and underwriting expertise, combined with Costco's member base, creates a unique marketplace for auto insurance. It's important for consumers to recognize that while the "Costco" name is on the program, the policy details, coverage limits, and claims handling will be governed by Connect's terms and conditions. This partnership aims to offer a competitive edge by combining the buying power of Costco with the insurance capabilities of Connect, a significant player in the insurance industry. This collaboration is designed to deliver value beyond just price, potentially including enhanced customer service and policy features tailored for Costco members.

How Connect Operates as an Underwriter

As the underwriter, Connect assumes the financial risk of insuring policyholders. This involves assessing the risk associated with each applicant, determining appropriate premiums, and managing the claims process when an incident occurs. Connect utilizes actuarial data, risk assessment models, and its own financial reserves to underwrite policies. For Costco members, this means that Connect is the entity that will approve or deny applications, set the specific rates based on individual driving records, vehicle types, and coverage choices, and ultimately pay out claims. The "Costco Auto Insurance" branding serves as a marketing and distribution channel, facilitating access to Connect's services for a specific demographic.

Benefits of Affinity Partnerships in Insurance

Affinity partnerships, like the one between Costco and Connect, offer several advantages. For consumers, they can lead to:

• Potential Cost Savings: Group purchasing power can translate into lower premiums.
• Convenience: A simplified process for obtaining quotes and purchasing insurance through a trusted brand.
• Tailored Products: Policies and discounts may be designed to meet the specific needs of the group's members.

For the insurance provider, these partnerships offer access to a large, pre-qualified customer base, reducing marketing costs and potentially attracting lower-risk individuals who are already loyal to the affinity group. In 2025, the insurance market continues to see the value in such collaborations, with Connect aiming to capitalize on Costco's extensive membership to build its auto insurance portfolio.

Key Coverage Options and Features

Costco Auto Insurance, through Connect, offers a comprehensive suite of coverage options designed to meet the diverse needs of drivers. Understanding these options is crucial for selecting the right policy. The standard offerings typically include:

Bodily Injury Liability

This coverage helps pay for medical expenses, lost wages, and legal fees if you are at fault in an accident that injures another person. It is a mandatory coverage in most states.

Property Damage Liability

This coverage pays for damage to another person's property (e.g., their car, fence, building) if you are at fault in an accident. Like bodily injury liability, it is generally required by law.

Collision Coverage

collision insurance covers damage to your own vehicle resulting from a collision with another vehicle or object, such as a tree or a guardrail, regardless of who is at fault. This coverage is typically required if you have a car loan or lease.

comprehensive coverage

This covers damage to your vehicle from non-collision events, such as theft, vandalism, fire, natural disasters (hail, flood, wind), and hitting an animal. Comprehensive coverage is also often required by lenders.

Uninsured/Underinsured Motorist (UM/UIM) Coverage

This coverage protects you if you are 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 damage to your vehicle.

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

MedPay covers medical expenses for you and your passengers, regardless of fault. PIP, available in "no-fault" states, is broader and can cover medical expenses, lost wages, and other related costs.

Roadside Assistance and Towing

Many policies offer optional roadside assistance, which can cover services like towing, jump-starts, tire changes, and lockout assistance. This can be a valuable add-on for peace of mind.

Rental Reimbursement

If your vehicle is being repaired due to a covered claim, rental reimbursement coverage can help pay for a rental car, allowing you to maintain mobility.

New Car Replacement

For newer vehicles, this optional coverage can provide the funds to purchase a brand-new car of the same make and model if your current vehicle is totaled, rather than just its depreciated cash value.

Gap Insurance

If you have a loan or lease on your vehicle, gap insurance covers the difference between what you owe on the car and its actual cash value if it's declared a total loss.

Example Scenario:

Imagine a Costco member in California driving a 2023 Toyota Camry. They have a comprehensive policy with Connect that includes liability, collision, comprehensive, UM/UIM, and rental reimbursement. If they are involved in an accident where they are at fault, their liability coverage will pay for the other party's damages. If their Camry is damaged in a hailstorm, their comprehensive coverage will pay for the repairs (minus their deductible). If the car is stolen and recovered with damage, comprehensive would also apply. If the car is totaled in an accident, collision coverage would pay for the car's depreciated value, and if they have a loan, gap insurance would cover the difference between the loan balance and the car's value.

2025 Statistics on Coverage Needs:

According to industry projections for 2025, the demand for robust coverage, particularly for uninsured/underinsured motorists and comprehensive/collision, is expected to remain high. With increasing vehicle repair costs and the prevalence of advanced automotive technology, ensuring adequate protection for one's vehicle and personal well-being is paramount. Data from the National Highway Traffic Safety Administration (NHTSA) continues to highlight the importance of liability coverage, as accidents, unfortunately, remain a reality. Furthermore, the rise in extreme weather events underscores the value of comprehensive coverage for protecting vehicles against non-collision damage.

Costco Auto Insurance: Pricing and Discounts

Pricing for Costco Auto Insurance, provided by Connect, is determined by a variety of factors, similar to most auto insurance providers. However, the Costco affiliation introduces potential avenues for savings through exclusive discounts. Understanding these elements can help members gauge whether the program offers competitive rates.

Factors Influencing Premiums

Connect, like any insurer, will assess individual risk profiles. Key factors include:

• Driving Record: Accidents, tickets, and DUIs will increase premiums. A clean driving record is the most significant factor in securing lower rates.
• Vehicle Type: The make, model, year, safety features, and theft risk of your car all play a role. More expensive or frequently stolen vehicles typically cost more to insure.
• Location: Where you live and park your car impacts rates due to local crime rates, traffic density, and weather patterns.
• Age and Experience: Younger, less experienced drivers generally pay more than older, more experienced drivers.
• Credit-Based Insurance Score: In many states, insurers use a credit-based insurance score to predict the likelihood of filing a claim. A higher score often leads to lower premiums.
• Coverage Selections: The types and limits of coverage you choose, along with deductibles, directly affect the premium. Higher deductibles usually mean lower premiums.
• Annual Mileage: Driving fewer miles per year can often result in lower rates.

Potential Costco Member Discounts

The primary draw for Costco members is the potential for exclusive discounts. While specific offers can vary and are subject to change, these often include:

• Costco Membership Discount: A direct discount for being a Costco member, which is the cornerstone of the program.
• Multi-Policy Discount: Bundling auto insurance with other Connect policies, such as homeowners or renters insurance, can lead to significant savings.
• Good Driver Discount: Rewarding drivers with a clean record over a certain period.
• Safety Features Discount: Discounts for vehicles equipped with advanced safety features like airbags, anti-lock brakes, and anti-theft systems.
• New Driver Discount: Some programs offer discounts for young drivers who maintain good grades or complete defensive driving courses.
• Defensive Driving Course Discount: Completing an approved defensive driving course can often earn a discount.
• Low Mileage Discount: For drivers who drive fewer miles annually.
• Paperless Billing/Auto-Pay Discount: Incentives for opting for electronic statements and automatic premium payments.

Example Pricing Comparison (Hypothetical for 2025):

Let's consider a hypothetical scenario for a 40-year-old married couple in a suburban area with two cars (a 2022 Honda CR-V and a 2023 Toyota Corolla), both with clean driving records. They require full coverage (liability, collision, comprehensive) and uninsured/underinsured motorist coverage.

*Note: These are hypothetical figures for illustrative purposes in 2025. Actual rates will vary significantly based on individual circumstances and location.

In this hypothetical example, Costco Auto Insurance appears to offer a competitive rate, especially when factoring in the potential for additional savings through bundling or other member-specific perks. The key is to obtain personalized quotes from all providers to make an informed decision.

How to Maximize Discounts

To ensure you're getting the best possible rate with Costco Auto Insurance (Connect), it's advisable to:

• Inquire about all available discounts: When getting a quote, ask the Connect representative about every possible discount you might qualify for.
• Bundle policies: If you own a home or rent, explore bundling your auto insurance with homeowners or renters insurance through Connect for potential multi-policy savings.
• Maintain a clean driving record: This is the most impactful way to keep your premiums low.
• Consider higher deductibles: If you have a financial cushion, opting for higher deductibles on collision and comprehensive coverage can lower your premium, but ensure you can afford the deductible if you need to file a claim.
• Review your policy annually: As your circumstances change (e.g., fewer miles driven, new safety features on your car), your premium may be eligible for adjustments.

How Costco Auto Insurance Compares to Competitors

Evaluating Costco Auto Insurance requires comparing its offerings, pricing, and customer service against other major auto insurance providers. While the partnership with Connect is a key differentiator, its overall performance needs to be assessed against the broader market landscape of 2025.

Direct Competitors and Their Strengths

Costco Auto Insurance (Connect) competes with a wide array of insurers, from large national carriers to smaller regional ones. Some prominent competitors include:

• State Farm: Known for its extensive network of local agents, strong financial stability, and a broad range of discounts. Often ranks high in customer satisfaction.
• Geico: Emphasizes online and phone-based sales, often promoting competitive pricing and a user-friendly digital experience.
• Progressive: Offers a variety of coverage options and discounts, including its Name Your Price tool and Snapshot program to reward safe driving.
• Allstate: Provides a comprehensive suite of products and services, with a focus on local agents and personalized advice.
• USAA: While not a direct competitor to Costco members unless they are military personnel or their families, USAA is consistently ranked as a top insurer for customer satisfaction and value.

Costco Auto Insurance (Connect) Strengths

• Membership Benefits: The primary strength is the potential for exclusive discounts and a streamlined process for Costco members. This can be particularly appealing to loyal Costco shoppers who trust the brand.
• Bundling Opportunities: The ability to bundle auto insurance with other Connect/Liberty Mutual products (home, renters) can lead to significant cost savings.
• Potentially Competitive Rates: By leveraging Costco's purchasing power, Connect aims to offer rates that are competitive, especially when combined with member discounts.
• Reputable Underwriter: Connect is a brand of Liberty Mutual, a well-established and financially stable insurance company, which provides a level of security.

Potential Weaknesses and Considerations

• Limited Direct Control: Costco acts as a facilitator. Policy details, underwriting, and claims are handled by Connect. This means the "Costco experience" might differ from the actual insurance provider's.
• Availability: Costco Auto Insurance might not be available in all states, or Connect might not be licensed to offer all types of policies everywhere.
• Customer Service Variability: While Costco has a strong reputation for customer service, the insurance-specific service is provided by Connect. Reviews for Connect's customer service and claims handling can vary, and it's important to research these independently.
• Not Always the Cheapest: While discounts are available, it's not guaranteed to be the lowest-priced option for everyone. Individual factors and specific discount eligibility play a significant role.

Comparison Table: Key Features (2025 Outlook)

*Note: Customer satisfaction data is based on general industry trends and J.D. Power/Consumer Reports ratings from recent years, projected for 2025. Actual performance can fluctuate.

In conclusion, Costco Auto Insurance's primary advantage lies in its exclusive benefits for Costco members. For individuals who are already loyal Costco shoppers and can leverage membership discounts and bundling opportunities, it presents a compelling option. However, it's crucial to conduct a thorough comparison by obtaining personalized quotes from Connect and other leading insurers. Factors like local agent availability, specific discount eligibility, and individual customer service experiences with Connect will ultimately determine if it's the best choice for your unique needs in 2025.

Customer Service and Claims Experience

The quality of customer service and the efficiency of the claims process are paramount when choosing an auto insurance provider. For Costco Auto Insurance, these aspects are handled by Connect, a subsidiary of Liberty Mutual. Therefore, evaluating the Costco Auto Insurance experience necessitates looking into Connect's performance in these critical areas.

Customer Service Channels and Support

Connect typically offers multiple channels for customer support:

• Online Portal: A secure website where policyholders can manage their accounts, view policy documents, make payments, and potentially initiate claims.
• Mobile App: A dedicated mobile application for convenient access to policy information and services on the go.
• Phone Support: Customer service representatives are available via phone to answer questions, assist with policy changes, and provide general support.
• Email Support: For less urgent inquiries, email communication may be an option.

The Costco connection might also offer a point of contact for initial inquiries or directing members to the appropriate Connect resources. However, the day-to-day management and issue resolution will be with Connect.

The Claims Process with Connect

When a policyholder needs to file a claim, Connect's process generally involves the following steps:

1. Reporting the Claim: The policyholder contacts Connect to report the incident. This can typically be done online, via phone, or through the mobile app. Prompt reporting is usually advised.
2. Claim Adjuster Assignment: A claims adjuster will be assigned to the case. This adjuster will assess the damage, gather information from all parties involved, and determine the extent of coverage.
3. Damage Assessment and Estimates: For vehicle damage, the adjuster will work with repair shops to get estimates. Policyholders may have the option to choose their preferred repair shop, though insurers often have networks of preferred providers.
4. Settlement: Once the damage is assessed and liability is determined, Connect will offer a settlement amount based on the policy's terms and conditions.
5. Payment: If the claim is approved, payment will be issued for repairs or replacement, minus any applicable deductible.

What to Expect in 2025:

The insurance industry is increasingly leveraging technology to streamline customer service and claims. In 2025, Connect is likely to continue investing in digital tools for faster claim processing, potentially including AI-powered damage assessment and virtual inspections. For Costco members, the expectation is a service level that aligns with the convenience and efficiency often associated with Costco's retail operations, translated into the insurance realm. However, it's important to manage expectations, as insurance claims can be complex and vary significantly in their resolution time and outcome.

Customer Reviews and Ratings

Independent reviews and ratings from organizations like J.D. Power, Consumer Reports, and the Better Business Bureau (BBB) can offer insights into Connect's customer service and claims handling. While Costco itself generally receives high marks for customer satisfaction, Connect's performance as an insurer is what matters for policyholders. Historically, Liberty Mutual (Connect's parent company) has received mixed reviews, with some customers praising its efficiency and others expressing frustration with claim settlements or communication.

Key areas to look for in reviews:

• Responsiveness: How quickly does Connect respond to inquiries and claims?
• Fairness of Settlements: Are claim payouts perceived as fair and in line with policy terms?
• Ease of Process: How straightforward is the claims process from start to finish?
• Communication: Is communication clear, consistent, and proactive?
• Agent/Adjuster Professionalism: Are the representatives knowledgeable and helpful?

It's advisable for potential customers to research recent customer feedback for Connect specifically, as performance can change over time. For instance, a search for "Connect Insurance reviews" or "Liberty Mutual auto claims satisfaction" can yield valuable information. By examining these reviews, consumers can gain a more realistic understanding of the service quality they can expect.

Who is Costco Auto Insurance Best Suited For?

Costco Auto Insurance, powered by Connect, is not a one-size-fits-all solution. Its unique structure and benefits make it particularly appealing to certain demographics and consumer profiles in 2025. Understanding these ideal customer segments can help you determine if it aligns with your priorities.

Loyal Costco Members

The most obvious group is individuals who are already dedicated Costco members. If you frequently shop at Costco, appreciate the brand's commitment to value, and trust its curated offerings, then exploring their auto insurance program is a natural next step. The built-in membership discount and the convenience of accessing insurance through a brand you already patronize can be significant advantages.

Value-Conscious Shoppers Seeking Bundling Discounts

Costco Auto Insurance is often attractive to consumers who are actively looking for ways to save money by bundling multiple insurance products. If you are looking to insure your home, renters, or other assets, the potential for multi-policy discounts through Connect can lead to substantial overall savings. This appeals to those who prefer to manage their insurance needs with fewer providers and seek integrated solutions.

Drivers with Good to Excellent Driving Records

Like most insurance providers, Connect likely offers its most competitive rates to drivers who have demonstrated a history of safe driving. Individuals with no recent accidents or traffic violations are typically well-positioned to receive the best pricing, especially when combined with the exclusive Costco member discounts. If you have a clean record, you are more likely to find Costco Auto Insurance to be a cost-effective option.

Members Seeking a Streamlined, Digital-First Experience (via Connect)

While Costco facilitates the initial connection, the actual insurance provider, Connect, often emphasizes digital tools for policy management and claims. Individuals who are comfortable using online portals and mobile apps to handle their insurance needs may find the Connect platform efficient and convenient. This contrasts with those who strongly prefer face-to-face interactions with a local agent.

Individuals Prioritizing Brand Trust and Convenience

For some consumers, the peace of mind that comes with associating with a trusted brand like Costco is a significant factor. The program offers a sense of security, knowing that Costco has vetted the provider to some extent. The convenience of a potentially simplified quoting process and consolidated billing (if bundling) can also be a major draw for busy individuals or families.

Who Might Not Find It Ideal?

• Drivers with Poor Driving Records: While Connect will offer policies, individuals with multiple recent accidents, tickets, or DUIs might find that other insurers offer more competitive rates or specialized programs for high-risk drivers.
• Those Needing Extensive Local Agent Support: If you strongly prefer working with a dedicated local agent for personalized advice and support, Costco Auto Insurance (Connect) might not be the best fit, as the primary interaction is through Connect's customer service channels or digital platforms.
• Consumers Seeking the Absolute Lowest Price Above All Else: While Costco Auto Insurance aims for competitive pricing, it's not guaranteed to be the absolute cheapest option for every driver in every situation. Thorough comparison shopping is always recommended.
• Individuals Not Eligible for Costco Membership: The core benefits, including the primary discount, are exclusive to Costco members.

Ultimately, the "goodness" of Costco Auto Insurance is subjective and depends heavily on individual circumstances, priorities, and eligibility. By understanding these factors, consumers can make a more informed decision about whether this program aligns with their insurance needs for 2025.

How to Get a Quote and Enroll

Getting a quote for Costco Auto Insurance through Connect is designed to be a straightforward process, leveraging the Costco membership. Here’s a step-by-step guide on how to navigate the process and potentially enroll in a policy for 2025.

Step 1: Verify Your Costco Membership

Before you begin, ensure you have an active Costco membership. You will likely need your membership number during the quoting process, as it's a prerequisite for accessing the program's benefits and potential discounts.

Step 2: Visit the Costco Auto Program Website or Contact Them

Costco typically directs members to a dedicated section of its website for the Auto Program, which includes insurance. Alternatively, you might find a specific phone number or link provided by Costco for insurance inquiries.

• Online: Navigate to the Costco website and look for the "Auto Program" or "Insurance" section. You should find a link to get an auto insurance quote through Connect.
• Phone: If you prefer speaking with someone, find the dedicated Costco Auto Insurance phone number. A representative can guide you through the process or connect you with Connect's quoting specialists.

Step 3: Provide Necessary Information for the Quote

You will be asked to provide detailed information about yourself, your household, your vehicles, and your driving history. Be prepared to share:

• Personal Information: Full names, dates of birth, addresses, and contact details for all drivers in your household.
• Driver Information: Driver's license numbers, driving history (accidents, tickets), and years of driving experience for each driver.
• Vehicle Information: Make, model, year, VIN (Vehicle Identification Number), safety features, and current mileage for each vehicle to be insured.
• Coverage Preferences: You'll need to decide on the types and levels of coverage you want (e.g., liability limits, deductibles for collision and comprehensive). If you're unsure, the quoting tool or representative can offer guidance based on state requirements and common practices.
• Costco Membership Number: This is crucial for verifying your eligibility and applying any membership-specific discounts.

Step 4: Review Your Quote(s)

Once you submit the required information, Connect will generate a personalized quote. Take your time to review it carefully:

• Coverage Details: Ensure the quote reflects the exact coverage options and limits you requested.
• Premium Breakdown: Understand how the total premium is calculated, including any applied discounts.
• Deductibles: Note the deductible amounts for collision and comprehensive coverage.
• Payment Options: Inquire about available payment plans (e.g., monthly, annual) and any associated fees.

Pro Tip: It's highly recommended to get quotes from other reputable insurance providers simultaneously to compare rates and coverage effectively. This ensures you are making the most informed decision.

Step 5: Ask Questions and Clarify Doubts

Don't hesitate to ask the Connect representative any questions you may have about the policy, coverage, discounts, or the claims process. Understanding the details upfront can prevent future misunderstandings.

Step 6: Enroll in the Policy

If you are satisfied with the quote and terms, you can proceed with enrolling in the policy. This typically involves signing policy documents electronically or physically and arranging for your initial payment.

Step 7: Post-Enrollment

After enrollment, you will receive your official policy documents. Keep these in a safe place and ensure you have your insurance ID cards readily accessible. Familiarize yourself with the contact information for customer service and claims filing.

The process is designed to be user-friendly, especially for those accustomed to Costco's efficient service model. By being prepared with the necessary information and taking the time to review the details, Costco members can effectively explore and potentially secure auto insurance through this partnership in 2025.

Conclusion

In summary, Costco Auto Insurance, powered by Connect, presents a compelling option for many Costco members in 2025, particularly those who value brand association, seek potential discounts, and appreciate a streamlined approach to insurance. The partnership leverages Costco's extensive membership base to offer competitive rates and exclusive benefits through Connect, a subsidiary of Liberty Mutual. Key strengths include the potential for significant savings through membership and multi-policy discounts, alongside the reliability of a well-established underwriter.

However, it's crucial for consumers to understand that the insurance itself is provided by Connect, and its performance in customer service and claims handling should be independently evaluated. While the program is well-suited for loyal Costco members with good driving records who prefer a blend of digital convenience and value, it may not be the optimal choice for everyone. Drivers with challenging records or those who prioritize extensive local agent support might find better alternatives elsewhere.

Therefore, the definitive answer to "How good is Costco Auto Insurance?" hinges on your individual circumstances. We strongly recommend obtaining personalized quotes from Costco Auto Insurance (Connect) and comparing them against at least two other leading insurance providers. By meticulously reviewing coverage options, deductibles, potential discounts, and customer service feedback, you can confidently determine if this partnership offers the best value and protection for your automotive needs in 2025.