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Best car insurance with a $500 deductible

Updated Oct 17, 2022
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If you opt for full coverage when making selections for your auto insurance policy, the insurance company will have you select your car insurance deductible amounts. Deductibles apply for coverage like collision and comprehensive coverage, and are what you would pay first to repair your vehicle after an incident before the insurance company covers the rest. Because deductibles are tied to how much you pay in premiums, it helps to know the different amounts you can choose and your best auto insurance options.

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What is a car insurance deductible?

A car insurance deductible is the amount you would be responsible for paying out of pocket if your vehicle needs repairs or replacement due to a covered accident or incident. Deductibles might also apply to claims for personal medical expenses. Whereas insurance premiums are how much you pay to insure your car for a period of time, your deductible only applies when you make a covered physical damage claim. Deductibles are usually available in increments ranging from $0 to $1,500, and the amount you choose has an impact on how much you pay for premiums. Most people choose a deductible between $500 and $1,000.

If you caused an accident, your liability coverage will cover the other party’s medical and property damage expenses. You will not have a deductible tied to this amount. However, you will typically find an auto insurance deductible tied to a comprehensive, collision or personal injury protection (PIP) claim you make with your vehicle. You may also have one for uninsured or underinsured motorist property damage claims. The types of coverage a deductible applies to can vary from state to state. A licensed insurance agent can assist with the appropriate deductible for each coverage.

Cost of car insurance with a $500 deductible

The average cost of car insurance with a $500 deductible is $1,771 per year for a full coverage policy, based on Bankrate’s 2022 study of quoted annual premiums. Bankrate’s sample driver profile includes a $500 deductible for both collision and comprehensive coverage. However, your rate is likely to differ from the national average based on a variety of personal factors, like your state, policy options and insurance company. A licensed insurance agent can work with you to show you exact quotes based on your personal factors.

Best car insurance with a $500 deductible

A $500 deductible is a fairly common choice, which means you should be able to find quotes from numerous providers with this deductible amount. The table below includes examples of the best car insurance with a $500 deductible in 2022 determined by Bankrate’s analysis of average annual premiums.

A full coverage policy, which typically refers to a policy including liability, comprehensive and collision coverage, provides greater financial protection versus only purchasing the bare minimum. However, there are other options available for added financial protection. For instance, gap insurance helps pay the “gap” between how much you owe on a lease or loan and the amount an insurance company values your vehicle at, should your new vehicle be totaled in a covered accident or if it is stolen and cannot be recovered.

Car insurance company Average monthly full coverage premium Average annual full coverage premium
Erie $110 $1,321
Geico $108 $1,297
State Farm $116 $1,397
Travelers $121 $1,447
USAA $101 $1,209

Is it better to have a higher deductible?

Deciding if it is better to have a higher or lower deductible is an individual choice and based on your financial circumstances. While a higher deductible usually allows for lower overall premiums, it also means you would have to pay more out of pocket in case of a collision or comprehensive claim with your vehicle. Many financial experts recommend having enough in savings to cover the deductible amount at any point. For example, if you have an at-fault car accident and your vehicle gets damaged, your out-of-pocket costs for repairs would reflect the amount you selected for your deductible.

The chart below illustrates the difference in premiums when you choose a $500 deductible versus the $1,000 option. By selecting the higher deductible option, the national average of premium savings is $215. It is up to your personal and financial situation to determine if it is better to pay less upfront and have to pay more out of pocket should you need to make a claim.

How to keep car insurance rates low

Adjusting your deductible is only one way to save on your auto insurance policy. In some cases, the cost difference between a higher and lower deductible may be negligible, or the higher deductible may be a price you couldn’t comfortably pay out of pocket. If that’s the case, there are still solutions to manage your car insurance premium.

Other ways to keep your car insurance rates low could include reviewing all discounts offered by your carrier to see if you are missing any that you’re eligible for on your policy. Additionally, driving safely and maintaining a clean driving record is the best way to keep rates in your favor. Being in an at-fault accident or receiving a moving violation could increase your car insurance rates for years to come.

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2022 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 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 2020 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.

Written by
Cate Deventer
Insurance Writer & Editor
Cate Deventer is a writer, editor and insurance professional with over a decade of experience in the insurance industry as a licensed insurance agent.
Edited by Insurance Editor
Reviewed by Senior wealth manager, LourdMurray