Best car insurance with a $500 deductible

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 $2,014 per year for a full coverage policy, based on Bankrate’s 2023 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

When shopping for quotes from various providers, you’ll find that a $500 deductible is a fairly common choice. Bankrate analyzed average quoted premiums from Quadrant Information Services to show what drivers might expect their policy to cost from top carriers. To determine our list of the best companies, our highly experienced insurance editorial team determined what factors impact a policyholder’s experiences with a company most and incorporated them into our five-point Bankrate Score model. 

The higher a company’s Bankrate Score, the better it performs across categories like customer satisfaction, financial strength, coverage options, online accessibility and more. Shoppers can use Bankrate Scores as an easy comparison tool between insurers. The table below includes the best car insurance with a $500 deductible based on our research.

A full coverage policy typically includes liability, comprehensive and collision coverage, and provides greater financial protection than only purchasing liability coverage. 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.

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. 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.

By selecting a higher deductible option, you could save considerably in some cases — even upwards of $100 per year on average. However, 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.

• Shop for quotes: As you saw in the chart above, not all insurance providers charge the same premium for a policy with a $500 deductible. Shopping around for multiple quotes can help ensure you find a comfortable balance between your premium and deductible.
• Ask about discounts: If you’re having trouble finding cheap car insurance with a $500 deductible, you may want to consider asking your provider what discounts you qualify for. Often excluded from your initial quote, discounts for safe driving, bundling, and more can help lower your car insurance costs — no matter your deductible.
• Opt out of collision and comprehensive: As your car depreciates, the cost of maintaining collision and comprehensive coverage may outpace the value of your vehicle. Once you own your vehicle outright and are no longer making payments, you may want to consider running the numbers to see if it would be more financially efficient to decrease to a liability-only policy. Just make sure that you are financially comfortable with your ability to repair or replace your vehicle if it gets damaged.
• Choose a higher deductible: You generally only have to pay your deductible if you are at fault in an accident and need to use your collision or comprehensive coverage. If you're confident in your safe driving abilities, you could consider raising your deductible in exchange for a cheaper premium.

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2023 rates for 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 2021 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.

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 highlight where they fall short.

• Tier 1 (Cost & ratings): To determine how well auto and home insurance companies satisfy these priorities, 2023 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.