Best car insurance with a $500 deductible

Key takeaways

• The average cost of car insurance with $500 deductibles for both collision and comprehensive insurance is $2,278 per year.
• An auto insurance deductible is the out-of-pocket cost a driver agrees to pay before insurance kicks in on a covered accident or incident.
• For cheap car insurance with $500 deductibles, drivers may want to get quotes from Auto-Owners, Travelers or NJM if they are available in your area.

What is a car insurance deductible?

A car insurance deductible is the amount you are responsible for paying out of pocket in order to make a comprehensive or collision claim 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 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. Deductibles are not required for state-mandated liability coverage. 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 $2,278 per year, based on Bankrate’s July 2024 analysis of quoted annual premiums. Bankrate’s sample driver profile includes $500 deductibles 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 insurance editorial team analyzed key factors that impact a policyholder’s experiences with a company — such as premiums, customer satisfaction and claims ratings — 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 major national and regional insurance carriers for cheap policies with $500 deductibles for comprehensive and collision insurance 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?

A lower deductible makes it cheaper to file an insurance claim, but a higher deductible can make your insurance cheaper to maintain by lowering your premium. The decision between a high or low deductible depends on your personal finances and priorities, but a few factors can guide your choice:

• Cost of coverage: If lowering your premium is your main priority, it may be better to choose a higher deductible, such as $1,000, in exchange for a reduced premium.
• Ability to file claims: A higher deductible makes it more expensive to file a claim — and if your vehicle sustains damage that’s less than your deductible amount, you won’t have the option to have it covered.
• Ability to pay deductible: Always choose a deductible that you can afford to pay in the event of a serious accident. If you don’t have the ability to cover your deductible, your coverage will be unusable if your vehicle is totaled.

How to keep car insurance rates low

Adjusting your deductibles 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 premium for $500 deductible car insurance.

• Shop for quotes: Not all insurance providers charge the same premium for a policy with  $500 deductibles. 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 $500 deductibles, 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.

Methodology

Bankrate utilizes Quadrant Information Services to analyze July 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.

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.

• 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.