Should you buy insurance from Costco? Here's what members should know

Shopping at Costco can offer more than just discounted bulk items and cheap hot dogs. The big box chain has some financial products worth looking into — including insurance.  

Buying a policy through Costco can result in lower premiums and exclusive benefits, especially for those with upgraded executive memberships. If you're considering a policy through Costco, you should factor in the membership costs when crunching the numbers: As of December 2025, a standard gold star membership costs $65 a year plus tax, while an executive membership costs $130. 

If you're already a Costco member, it could be worth getting a quote as you shop for insurance. Here's what you need to know about buying insurance from Costco.   

Costco Insurance Agency offers many types of policies, including life, auto, home, rental, umbrella and pet insurance.

When you get a policy through Costco, you're purchasing coverage from a third-party insurer -- the mammoth warehouse club leverages its size to offer members lower rates and other perks. Auto policies are underwritten by American Family Connect Property and Casualty Insurance Company, American Family Connect Insurance Company, or Midvale Indemnity Company. Homeowners insurance is through Homesite, and life insurance policies are handled by Protective Life.

However, Costco's member discount is not available on home insurance in Florida and Tennessee, or on auto insurance for non-Executive Members in Massachusetts.

Costco auto policies include an exclusive discount in addition to the rate reductions that Connect offers for student drivers, insuring multiple cars and completing a defensive driving course.  

Costco gold star members enjoy a number of benefits, including:  

• Glass repair deductible waiver. If your windshield is chipped or cracked and can be repaired rather than replaced, the deductible is waived.  
• Accident travel expense coverage. If you're involved in an accident more than 100 miles from home, your lodging, meals, transportation home and other expenses may be covered.

Executive members also enjoy:  

• Guaranteed renewability. This can ensure your coverage continues, even after an accident. (Not available in Michigan or Maryland.) 
• Roadside assistance. In most states, your policy covers flat tires, dead batteries and other issues, up to $75 per occurrence. 

American Family has good ratings for financial strength, according to A.M. Best, and it was relatively well-rated in J.D. Power's 2025 claims satisfaction study.

Costco's home insurance is provided by Homesite, with several types of enhanced coverage, including:

• Refrigerated property coverage. If your home loses power for an extended period, you can be reimbursed for up to $500 in perishable items. (This coverage isn't available to residents of Florida or Texas.) 
• Identity theft protection. If your identity is stolen, Costco's home insurance can cover associated costs of up to $5,000.
• Stolen credit card and check fraud coverage. If your credit card is stolen or hacked, or if someone writes a fraudulent check on your account, this deductible-free benefit can cover legal fees, lost wages and other costs associated with restoring your identity.
• Service line coverage. Homeowners are responsible for water pipes, power lines, cables and sewer lines on their property. This add-on covers the cost of repairing damage caused by wear and tear, rust and deterioration, freezing, electrical malfunction, root and tree invasion, and other issues.
• Equipment breakdown coverage. If an appliance or smart home system is damaged, this add-on coverage can pay for repairs or replacements.

Costco executive members get several other perks, including:  

• Glass repair reimbursement. Up to $1,000 in repairs to broken windows is covered per occurrence, with a limit of two claims per 12-month period.  
• Home lockout assistance. Policies include 24-hour service and coverage of up to $100 per occurrence, with a limit of two claims a year.  

Insurance companies can calculate the actual cash value (ACV) of your belongings, which factors in depreciation, or they can use the replacement cost value (RCV), which doesn't. Many providers offer RCV coverage as an optional add-on, but in most states, it's standard with Costco's CONNECT by American Family policies. 

Homeowners insurance via Costco is underwritten by Homesite. In J.D. Power's home insurance customer satisfaction index, Homesite scored well below the study average. However, it has earned an A for financial strength from A.M. Best. 

Underwritten by Protective Life, Costco's life insurance policies pay out up to $5 million and are available in 10-, 20- and 30-year terms. No medical exam is required and you can apply online or by phone.  

According to Protective Life's website, a 40-year-old male in good health could obtain $250,000 of coverage with a 20-year period for $19.04 per month as a gold star member for the first five years, and $18.28 per month for five years as an executive member. However, prices with both membership types increase to $20.83 in the sixth year of coverage and beyond.

Even after the fifth year's increase, these prices remain relatively affordable: According to Policygenius data, the same 40-year-old male would typically pay $25.39 for a similar policy.

Costco only offers a term life insurance product. If you want permanent life insurance, you'll need to look elsewhere.

In terms of customer satisfaction, Protective scored below average in J.D. Power's 2025 Individual Life Insurance Study.

At CNBC Select, our mission is to provide our readers with high-quality service journalism and comprehensive consumer advice so they can make informed financial decisions. Every insurance review is based on rigorous reporting by our team of expert writers and editors with extensive knowledge of insurance products. While CNBC Select earns a commission from affiliate partners on many offers and links, we create all our content without input from our commercial team or any outside third parties, and we pride ourselves on our journalistic standards and ethics.

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