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Geico vs Costco
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Established in 1936, Geico holds a 13.8 percent share of the auto insurance market share. It provides standard coverage policies and perks for everyday drivers, and operates nationwide. Geico also extends its insurance offerings beyond auto insurance. However, the company doesn’t underwrite these policies directly; instead, it works with various insurance companies for underwriting.
Founded in 1976, Costco offers discounted car insurance in 44 states and Washington, D.C. through a partnership with American Family. American Family, holding a 2.1 percent share of the private passenger auto insurance market, underwrites Costco’s auto policies through its subsidiary CONNECT. Costco’s car insurance partnership includes typical coverage options and requires membership for coverage discount eligibility. If you’re deciding whether to go with Costco or Geico for coverage, Bankrate’s in-depth comparison can help.
| Geico | Costco | |
|---|---|---|
| Bankrate score | 4.4 | Not rated |
| Tier 1 | 4.7 | Not rated |
| Tier 2 | 4.0 | Not rated |
| Tier 3 | 4.4 | Not rated |
Geico vs. Costco comparison
When comparing Geico vs. Costco for auto insurance, it may be helpful to weigh a number of different variables. For instance, discounts, coverage options, average rates for different incidents and unique incentives can all be worth considering. It may also be helpful to consider the unique pros and cons for each provider to determine which may be the best fit for your needs.
Geico pros and cons
Pros
- Low average premiums
- A range of digital tools
- Numerous discount opportunities
Cons
- Limited options for add-on coverage
- Brick-and-mortar agency access is limited
- Doesn’t offer rideshare insurance
Costco pros and cons
Pros
- Exclusive discount opportunities for members on Connect policies
- Strong financial strength rating from AM Best
- Offers other discount opportunities
Cons
- Not available in all states
- Requires membership for eligibility
- Customer service not available 24/7
Is Geico cheaper than Costco?
Average rate data for Costco members is not available, making it difficult to compare Geico and Costco’s average costs for car insurance. It may instead be helpful to compare the 2023 national average costs of car insurance against Geico’s average car insurance rates to find out how they stack up. Based on our comparison of average rate data from Quadrant Information Services, Geico generally has lower averages for both full and minimum coverage policies compared to the national average.
| Car insurance company | Average annual premium for full coverage | Average annual premium for minimum coverage |
|---|---|---|
| Geico | $1,353 | $373 |
| Costco | N/A | N/A |
| National Average | $2,014 | $622 |
Geico is generally cheaper for drivers with poor credit
Not all states allow insurance companies to consider credit scores when calculating car insurance rates. In particular, California, Hawaii, Maryland, Massachusetts and Michigan outlaw the use of credit-based insurance scores to determine rates. In other states, credit scores can impact the cost of car insurance. When compared to the national average, Geico has lower average rates by credit score in each category.
| Credit Score | Geico | National Average |
|---|---|---|
| Poor | $1,791 | $3,479 |
| Average | $1,379 | $2,176 |
| Good | $1,297 | $2,014 |
| Excellent | $1,207 | $1,764 |
Geico is generally cheaper for young drivers
Younger drivers have less experience behind the wheel, which means that they are statistically more likely to get into an accident on the road. In turn, young drivers tend to pay the highest average rates for car insurance in most states to compensate for the higher risk of insuring them. When compared to the national average, Geico’s average rates tend to be lower for young drivers in several age groups.
| Geico | National Average | |
|---|---|---|
| Age 16 | $2,977 | $4,392 |
| Age 17 | $2,753 | $4,102 |
| Age 18 | $2,523 | $3,837 |
| Age 19 | $2,212 | $3,345 |
| Age 20 | $2,054 | $3,149 |
*Rates for young drivers on their parent’s policy
Geico is generally cheaper for adult drivers
Average car insurance rates tend to go down for drivers as they get older and gain more experience behind the wheel. Compared to the national average, Geico tends to offer lower average rates for adult drivers.
| Geico | National Average | |
|---|---|---|
| Age 18 | $4,048 | $6,110 |
| Age 25 | $1,584 | $2,473 |
| Age 30 | $1,389 | $2,125 |
| Age 40 | $1,353 | $2,014 |
| Age 60 | $1,264 | $1,824 |
*Rates are for drivers on their own policy.
Geico is generally cheaper for high-risk drivers
Speeding tickets, accidents and other incidents can have a significant impact on the cost of car insurance. Compared to national average rates, Geico generally offers lower average rates for high-risk drivers. While average DUI rates are outlined below, it’s important to note that not all companies will offer coverage to drivers with a DUI on their record.
| Geico | National Average | |
|---|---|---|
| Clean driving record | $1,353 | $2,014 |
| Speeding ticket conviction | $1,658 | $2,427 |
| At-fault accident | $1,988 | $2,854 |
| DUI conviction | $3,351 | $3,091 |
Geico vs. Costco: 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 unique discounts
- 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 discount.
- 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 unique discounts
- 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: Customer experience comparison
Geico and Costco’s Connect by American Family both offer an online experience with websites that include information about coverage options and discounts, as well as online quote tools and support for online claims. Geico also offers a mobile app 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 | Costco (American Family) | |
|---|---|---|
| App Store | 4.8 out of 5 | N/A out of 5 |
| Google Play Store | 4.6 out of 5 | N/A out of 5 |
| J.D. Power | 871 / 1,000 | 882 / 1,000 |
Frequently asked questions
Methodology
Bankrate utilizes Quadrant Information Services to analyze May 2024 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a single, 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 coverage that meets each state’s requirements. Our base profile drivers own a 2022 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-based insurance scores: 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. Four states prohibit or limit the use of credit as a rating factor in determining auto insurance rates: California, Hawaii, Massachusetts and Michigan.
Incidents: 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.
Age: Rates were calculated by evaluating our base profile with the ages 18-60 (base: 40 years) applied. Depending on age, drivers may be a renter or homeowner. Age is not a contributing rating factor in Hawaii and Massachusetts due to state regulations.
Bankrate Scores
Our 2024 Bankrate Score considers variables our insurance editorial team determined impacts policyholders’ experiences with an insurance company. These rating factors include a robust assessment of each company’s product availability, financial strength ratings, online capabilities and customer and claims support accessibility. Each factor was added to a category, and these categories were weighted in a tiered approach to analyze how companies perform in key customer-impacting categories.
Each category was assigned a metric to determine performance, and the weighted sum adds up to a company’s total Bankrate Score — out of 5 points. Our scoring model provides a comprehensive view, indicating when companies excel across several key areas and highlighting where they fall short.
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Cost & ratings 50%
-
Coverage & savings 30%
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Support 20%
- Tier 1 (Cost & ratings): To determine how well auto and home insurance companies satisfy these priorities, average quoted premiums from Quadrant Information Services (if available), as well as any of the latest third-party agency ratings from J.D. Power, AM Best, Demotech and the NAIC, were analyzed.
- Tier 2 (Coverage & savings): We assessed companies’ coverage options and availability to help policyholders find a provider that balances cost with coverage. Additionally, we evaluated each company’s discount options listed on its website.
- Tier 3 (Support): To encompass the many ways an auto insurance company can support policyholders, we analyzed avenues of customer accessibility along with community support. This analysis incorporated additional financial strength ratings from S&P and Moody’s and factored a company’s corporate sustainability efforts.
Tier scores are unweighted to show the company's true score in each category out of a possible five points.