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Costco Car Insurance Reviews: Cost & Coverage

Costco has a long list of car insurance discounts and benefits but is lacking in coverage and availability. The company isn’t available in every state.

If you’re already a Costco member and want basic insurance without too many frills, Costco car insurance may have a great deal for you. The insurer includes useful perks with every insurance policy, including glass repair, stolen key coverage, and travel accident benefits.

How We Rated Costco Car Insurance

We refresh our review standards multiple times per year to keep our information current. Overall, our insurance research falls into six main categories:

  • Industry standing
  • Availability
  • Coverage
  • Cost and discounts
  • Customer service
  • Technology

Part of this research included examining millions of data points from Quadrant Information Services to provide the average car insurance premiums charged by top providers. Below, you can see how Costco car insurance through CONNECT scores out of 5.0 in each category.

Industry Standing: 4.3 Stars

To determine a company’s business value in the industry, we check its Better Business Bureau (BBB) rating, AM Best score, and total market share. The BBB analyzes the customer service records, business practices, and licensing information of different companies. AM Best looks at an insurance provider’s financial strength, among other factors.

American Family doesn’t have the strongest share of the car insurance market, but does get good ratings from both the BBB and AM Best. For having a standing in the car insurance industry that is strong but not perfect, American Family gets a high rating from us.

Availability: 3.5 Stars

To rate insurance availability, we consider what states the company offers coverage in and what kind of special exclusions it has. Since you can only get a Costco car insurance policy by being a Costco member, the company gets a middle-of-the-road rating. 

Coverage: 3.8 Stars

When considering what car insurance company to go with, you likely want a provider that offers the standard types of car insurance drivers put in their policies, plus plenty of add-ons. Costco’s auto insurance through CONNECT offers a fair amount of coverage options. 

However, the company lacks specific add-ons that are common in the industry, so we give it an above-average score. 

Cost And Discounts: 4.7 Stars

Most insurance providers offer very different costs and discounts. American Family has a generous amount of discounts, so we give it a high rating. 4.7 out of 5.0 stars due to its generous amount of discounts and low costs.

Customer Service: 4.7 Stars

Our team examines hundreds of customer reviews from sites like the BBB and Trustpilot. We also look at findings and scores from J.D. Power consumer studies, complaint ratios from the National Association of Insurance Commissioners (NAIC), and what customers report on our own consumer surveys.

American Family has low customer satisfaction ratings across the BBB and Trustpilot, but this is largely because there aren’t many negative reviews on these sites to begin with. American Family’s unhappy customers make up a very small portion of its overall policyholder population. The provider also shows positive scores from J.D. Power, so we give it a high service rating.

Technology: 4.0 Stars

For this last category, we look over customers’ experiences with providers through its website, apps, and other technology. American Family has well-rated apps on the App Store and Google Play – for both its mobile app and usage-based insurance app.

Costco Auto Insurance Quick Facts

Founded: 1976
Availability: 44 states
American Family AM Best financial strength rating: A
American Family BBB rating: A

Costco began as Price Club in 1976, which only served small businesses at first. After realizing it could make more money by getting low prices for the public, Costco remodeled the warehouse club industry. CONNECT is a company that partners with multiple insurers to bring Costco customers the right coverage for their specific needs.

Costco car insurance is sold through CONNECT by American Family Insurance. Some sites may state that Ameriprise is the company that backs Costco car insurance, but Ameriprise was bought by American Family in 2019 and renamed CONNECT. 

Where Is Costco Auto Insurance Not Available?

CONNECT sells American Family Insurance in 44 states total. Here are the states where Costco’s auto insurance is not available:

  • Alaska
  • Maine
  • Louisiana
  • Rhode Island
  • West Virginia
  • Wyoming

Costco Car Insurance Industry Ratings

American Family Insurance has an A rating from the BBB but isn’t accredited. It received rating from AM Best, attesting to the company’s financial strength.

American Family is one of the largest auto insurance companies in the U.S., with 2.11 percent of the national market share and $5.8 billion premiums written in 2022, according to the NAIC. However, its share isn’t large when compared to Geico’s or State Farm’s market shares.

CONNECT by American Family ranks well above average for customer satisfaction in the J.D. Power 2022 U.S. Auto Insurance Study℠ in California. American Family alone also remains above average in the Midwest, northern Midwest, and Southwest U.S. regions.


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