15 Things to Know Before Buying Costco Insurance

Costco, the fifth-largest retailer in the world, has made a name for itself as the purveyor of quality goods at low, low prices, and even sells insurance to club members.

Therefore, you may wonder if you can save more by switching to Costco Insurance. However, make sure to read this list of facts before deciding to make a change!

15 Things to Know Before Buying Costco Insurance In 2024

1. Insure Your Home and/or Vehicle With CONNECT Through Costco Insurance

Costco may be a large international company, but it doesn’t have its own insurance agency.

Instead, Costco has partnered with CONNECT, a subsidiary of American Family Insurance, to bring its club members home and auto insurance for a lower price.

American Family Insurance is an established, trustworthy entity that currently holds two percent of the insurance market share in the U.S.

2. Costco Insurance Is Only Available for Warehouse Members

As you might have gleaned from the above, Costco Insurance coverage is only available to members of the warehouse chain. Membership costs $60 for the Gold level and $120 for the Executive, both per year.

As you will see, while there are plenty of benefits for Gold members, the Executive-level perks are even better.

3. Make Sure Costco Insurance Is Available in Your State

One downside to Costco insurance is that auto coverage is not available in every state.

The states in which you cannot be covered by Costco’s CONNECT plans include Louisiana, Maine, Michigan, North Dakota, West Virginia and Wyoming.

4. Costco Insurance for Vehicles Provides Basic Coverage

In a word, Costco insurance for automobiles can be best described as basic. Few frills mark this coverage, which does take care of the following:

  • Personal injury and damage to property
  • Collision damage
  • Comprehensive
  • Uninsured and/or underinsured drivers
  • Medical treatment

There are other types of coverage, including rental insurance and gap insurance, but those are add-ons and cost extra.

Included perks for all members and all auto insurance policyholders include a Glass Repair Deductible Waiver, Stolen Key Coverage and Accident Travel Expense.

5. Costco Insurance for Homes Is More Robust

Bankrate.com finds Costco home insurance options “more robust,” and the coverage does seem fuller.

There is the baseline basic coverage, which includes protection for the residence and personal property, as well as liability coverage and payments for medical treatment.

If you live somewhere that is earthquake-prone, like along the California coast, Costco offers coverage for that.

Built-in home insurance benefits include identity theft protection, coverage for credit card or other fraud and even food spoiling up to $500.

In fact, if your electricity goes out in the heat of summer (as it can do) and the contents of your fridge spoil, you can be reimbursed by your insurance company!

Also, if your home is broken into and burgled, you can get $100 to replace the locks.

6. You Can Cover Other Investments with Costco Insurance, Too

Costco insurance covers more than just single-person homes and vehicles, and you can purchase policies for the following:

  • Renter’s insurance
  • ATVs
  • Boats
  • Collector Cars
  • Flooding
  • Motorcycles
  • RVs
  • Rental properties (as the landlord)

7. Save Potentially Hundreds of Dollars with Costco Insurance

Costco claims that it can save most people hundreds of dollars on insurance, and The Zebra finds that Costco does indeed have the cheapest average rates out of all the major names in insurance, like Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm.

Even USAA, which costs about $607 per half-year, is overpriced compared to Costco’s CONNECT average rate of $534.

There aren’t any definite numbers for Costco’s homeowner’s insurance available to the public at this time, but Investopedia, an authority on all things financial, finds it very likelythat itsrates are quite competitive.

8. Bundle for Even Greater Costco Insurance Savings

8. Bundle for Even Greater Costco Insurance Savings

If you need both home insurance and car insurance, you can bundle and save even more on Costco insurance rates.

Consider bundling these policies, or using the bundling discount as an excuse to get that RV or boat you’ve been eyeing.

9. Check Out Which Costco Insurance Discounts Could Benefit You

Costco offers discounts for a variety of situations, for both home and auto. You can get a discount on your home insurance based on the following:

  • Age of your home
  • Lack of former claims
  • Presence of protective devices
  • Tenure (length of time as a policyholder with Costco Insurance)
  • Renovations

For auto policies, Costco gives discounts based on the following:

  • Simply being a Costco member
  • Being a safe driver
  • Spotless driving record overall
  • Completion of state-certified defensive driving courses
  • Driving vehicles with safety features
  • Owners who park in garages
  • Good students with high grades
  • College students who only use the car when home
  • Drivers who have completed four years of higher education or additional education beyond high school
  • Policyholders with multiple vehicles insured by Costco
  • Tenure (length of time as a policyholder with Costco Insurance)

10. Choose From Plenty of Costco Insurance Add-ons for Home & Auto

In addition to the previously mentioned types of add-ons for Costco auto insurance, rental car coverage and GAP insurance, you can also add on new car replacement and roadside assistance.

Add-on home insurance includes coverage for extraordinarily expensive items on the property, called Scheduled Personal Property.

If you have a Picasso, a rare sports card collection, or great-grandmother’s five-carat platinum ring on the property, you can specially protect it.

11. Receive Extra Costco Insurance Services as an Executive Member

Executive members pay more annually than Gold members, but they also receive more in the form of perks, as well.

For example, the roadside assistance add-on that Gold members have to pay for (if they want it to be part of their policy) is included with Executive members’ policies.

They also get Lifetime Renewability benefits, meaning that the Costco Insurance can’t drop them for minor accidents (major ones are a different story, however).

As well, Executive members also get extra home insurance perks, including Glass Repair Reimbursement and Home Lockout Assistance.

12. Make Your Costco Insurance Payments on Your Terms

You have options when it comes to paying for your Costco Insurance policies, including monthly installments or one large lump payment once a year.

Let’s face it- even Costco Insurance prices constitute a huge chunk of change to put down all at once, so take advantage of the smaller payments monthly if you need to.

13. Costco Insurance Isn’t the Most Tech Savvy

One additional drawback to Costco Insurance is that CONNECT isn’t the most tech-savvy company to work with. Mainly, it doesn’t have a mobile app for easy payment and claims.

For example, if you’re hit by a driver who has State Farm insurance, they can use the company app to take pictures of all the damage to your vehicle and fully detail the extent of the body work needed.

Unfortunately, CONNECT has no such technology at this time.

14. Customers Are Generally Positive About Costco Insurance

Customers of Costco Insurance tend to be pretty happy about their coverage, with half of all reviewers at Clearsurance.com calling it “Excellent,” while a further 27 percent called it “great.”

Customers singled out the flexible billing options, discounts and transparent pricing as major wins.

However, there are definitely some unhappy customers, and their most common complaint appears to be rate changes, up and down, from year to year.

15. Ultimately, Costco Insurance Is Great for Some

Overall, Costco Insurance might not be a great fit for some customers, especially those who are very particular about their coverage and want to be able to customize it.

However, if you’re looking for basic, general coverage that hits all the major needs when it comes to insuring your home or vehicle, the prices are worth giving Costco Insurance a try.

To know more, you can also see our posts on whether or not Costco optical takes insurance, if Costco offers a senior discount on membership, and if Costco offers military discounts.


Costco Insurance offers affordable coverage for both home and auto, through the company CONNECT, a subsidiary of American Family Insurance.

Customers can potentially save hundreds of dollars on policies with many discounts and perks, plus 24/7 incident reporting.

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Marques Thomas

Marques Thomas graduated with a MBA in 2011. Since then, Marques has worked in the retail and consumer service industry as a manager, advisor, and marketer. Marques is also the head writer and founder of QuerySprout.com.

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