Geico vs Costco | Bankrate

Table of Contents Geico vs Costco Insurance: car insurance rates comparisonRates by credit scoreRates by ageRates by driving recordGeico vs Costco Insurance: discounts Geico vs Costco Insurance: online and mobile experience comparisonFrequently asked questionsWhat is the best car insurance company?How much does car insurance cost?Is car insurance legally required?MethodologyBankrate Scores […]

Geico, which stands for Government Employees Insurance Company, is owned by international holding company Berkshire Hathaway. Geico has more than 17 million car insurance policies in force and insures more than 28 million vehicles across the country. Geico was founded in 1936 and holds 14% of the total market share, making it the second largest car insurance provider in the U.S.

While not a traditional insurance company, wholesale retailer Costco offers a members-only insurance policy through CONNECT by American Family. CONNECT came to the market when American Family acquired Ameriprise Insurance in 2019 and went through a rebrand. The company offers a few insurance policies, with a focus on affordable home and auto coverage.

Geico vs Costco Insurance: car insurance rates comparison

The table below includes the third-party ratings and average premiums from Quadrant Information Services for Costco car insurance via Geico. One disclaimer is that the rates for Costco insurance reflect the rates for American Family, as Costco insurance is provided through the CONNECT division of the company. That means the average rates for American Family may or may not reflect the rates that a Costco member will receive through CONNECT.

In addition to third-party ratings, we also assigned each company a Bankrate Score, a score out of 0.0 to 5.0. To determine this score, Bankrate evaluated the company on different categories (average annual rates, third-party ratings, coverages offered, discounts offered) and utilized a uniform methodology to ensure that each company is rated using the same criteria.

Car insurance company Bankrate Score AM Best J.D. Power Average annual premium for minimum coverage Average annual premium for full coverage
Geico 4.6 A++ 871/1,000 $433 $1,405
Costco 3.7* A- 862/1,000 N/A N/A

*Costco offers insurance through CONNECT, a division of American Family, whose ratings are provided here

Rates by credit score

Geico and Costco will use your credit score to determine your premium, but it depends on where you live. The only states where it is illegal for insurance companies to use credit scores to calculate insurance rates are Hawaii, California, Massachusetts, Michigan and Washington. In the table below, you can see the average premiums for Geico and the national average based on credit score – rates are unavailable for Costco but they would be similar to the national average:

Car insurance company Poor Average Good Excellent
Geico $1,978 $1,505 $1,405 $1,312
National average $3,873 $1,865 $1,674 $1,487

Rates by age

Young drivers pay the highest rates for car insurance because they lack on-road experience, and are more likely to get into an accident. The table below highlights the average annual rates for several age groups. While rates are not available for Costco insurance specifically, its rates will likely be similar to the national average rate based on age.

Car insurance company Age 16* Age 18 Age 25 Age 30 Age 40 Age 60
Geico $1,897 $3,672 $1,674 $1,465 $1,405 $1,326
National average $2,531 $5,243 $2,108 $1,850 $1,674 $1,544

*16 year old cost when added to parents’ policy, 18-year-old renter

Rates by driving record

Drivers with a clean record pay the lowest rates for car insurance and drivers with a history of accidents, speeding tickets or DUI convictions pay much higher rates. The table below compares Geico’s average rates to the national average based on driving record. While rates are not available for Costco insurance, expect the average premiums to match up to the national average.

Car insurance company Clean driving record Speeding ticket Accident DUI conviction
Geico $1,405 $1,734 $1,971 $3,064
National average $1,674 $2,062 $2,311 $3,139

Geico vs Costco Insurance: discounts

Both Geico and Costco offer car insurance discounts that can help drivers save money on their auto policy. However, each provider offers unique discounts. Here are the discounts you can get through Costco auto insurance vs. Geico:

Geico:

  • Federal employee discount — Geico is one of the few insurance companies that offers a potential discount for federal government employees.
  • Military discount — Geico customers who are active duty military service members may qualify for a reduced premium.
  • Membership/employee discount — Drivers may get a discount on their Geico policy if they belong to certain membership groups or work for a participating employer.

Costco Insurance:

  • Premier safety discount — Drivers who have a perfect record, with no traffic violations, accidents or claims within the past four years may qualify for a discount.
  • Garaging discount — If you keep your car in a garage when it is not in use, CONNECT may give you a lower premium.
  • Education discount — CONNECT offers potential savings for students who complete a four-year degree program. This also applies to students who are insured on their parent’s policy.

Geico vs Costco Insurance: online and mobile experience comparison

Geico and CONNECT by American Family both have a good online experience. Based on our comparison, we found that Geico’s website is slightly easier to navigate and has more information about the coverage options and discounts. It is also worth noting that Geico and CONNECT both have an online quote tool and support online claims.

In terms of mobile experience, Geico has one of the top-rated mobile apps that allows policyholders to manage their policy, file claims, make payments and more. If you have Costco insurance, you can only manage your policy online.

Geico:

  • App Store (4.8 stars) — Geico’s free iOS app allows policyholders to file a claim, make a payment, request roadside assistance, view ID cards and get maintenance reminders. Overall, customers are satisfied with Geico’s app, with positive reviews of the user interface, ease-of-use and frequent updates
  • Google Play Store (4.8 stars) — Through Geico’s Android mobile app, users get access to all the same features that are included with the iOS app. Customers say the app is easy to navigate and convenient. However, some users have complained about issues logging in and making payments.

Costco Insurance:

If you have Costco insurance through CONNECT by American Family, you can manage your policy through the online customer portal. You can pay your premium, request your declaration page or insurance binder and download your ID cards. To make changes to your policy, you will need to contact an agent.

Frequently asked questions

What is the best car insurance company?

The best car insurance company is different for every driver. Some car insurance carriers are known for low premiums, some are great for customer service and others stand out for their coverage options. The only way to find the best company for you is to shop around and compare providers using your own criteria.

How much does car insurance cost?

In the United States, the average cost of car insurance is $1,674 per year for a full coverage policy. However, auto insurance premiums are personalized based on factors like your age, state, credit score (in most states), driving history and the type of car you have.

Is car insurance legally required?

Yes, car insurance is legally required in almost every state. The only state that does not require traditional car insurance is New Hampshire. In many states you also have the ability to satisfy financial responsibility in other ways, like securing a bond.

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

  • $100,000 bodily injury liability per person
  • $300,000 bodily injury liability per accident
  • $50,000 property damage liability per accident
  • $100,000 uninsured motorist bodily injury per person
  • $300,000 uninsured motorist bodily injury per accident
  • $500 collision deductible
  • $500 comprehensive deductible

To determine minimum coverage limits, Bankrate used minimum coverages that meet each state’s requirements. Our base profile drivers own a 2019 Toyota Camry, commute five days a week and drive 12,000 miles annually.

These are sample rates and should only be used for comparative purposes.

Credit: Rates were calculated based on the following insurance credit tiers assigned to our drivers: “poor, average, good (base), and excellent.” Insurance credit tiers factor in your official credit scores but are not dependent on that variable alone. The following states do not allow credit to be a factor in determining auto insurance rates: California, Hawaii, Massachusetts, Michigan, Washington.

Age: Rates were calculated by evaluating our base profile with the ages 18-60 (base: 40 years) applied. 16-year-old rates were factored as the added cost to their parents’ policy; 18-year-old rates were calculated as drivers who rent their primary residence. The following states do not allow age to be a factor in determining auto insurance rates: Hawaii

Incident: Rates were calculated by evaluating our base profile with the following incidents applied: clean record (base), at-fault accident, single speeding ticket, single DUI conviction (BAC of >= .08) and lapse in coverage.

Bankrate Scores

Bankrate Scores primarily reflect a weighted rank of industry standard ratings for financial strength (AM Best, S&P, Moody’s) and customer experience (J.D. Power, NAIC), in addition to average quoted rates from Quadrant Information Services. The J.D. Power studies utilized include the 2020 Auto Insurance Study and the 2020 Auto Claims Study. Our Bankrate editorial team’s extensive research and analysis provided a secondary assessment of each insurer’s online and mobile resources and policy management options, which also contributed to overall ratings.

Melinda Krah

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