Best Car Insurance with a $500 Deductible (2024)

With a $500 car insurance deductible, you’ll pay less out of pocket if you need to file a claim, but your monthly premiums will likely be higher.

Amy Beardsley
Written byAmy Beardsley
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Amy BeardsleyInsurance Writer
  • 3+ years writing about auto, home, and life insurance

  • 7+ years in personal finance and technology

Amy specializes in insurance and technology writing and has a talent for transforming complex topics into easy-to-understand stories.

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Sarah Archambault
Sarah Archambault
  • Experienced personal finance writer

  • Background working with banks and insurance companies

Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.

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Updated October 30, 2024

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*Quotes generated for Insurify users within the last 10 days. Last updated on October 30, 2024

Rates shown are real-time Insurify user quotes from 100+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from October 30, 2024. Actual quotes may vary based on the policy buyer’s unique driver profile.

*Quotes generated for Insurify users within the last 10 days. Last updated on October 30, 2024

Rates shown are real-time Insurify user quotes from 100+ insurance companies and Quadrant Information Services data. Insurify’s algorithm excludes anomalous quotes and anonymizes personal details, then displays refined quotes by price, date, and insurer popularity up to 10 days ago from October 30, 2024. Actual quotes may vary based on the policy buyer’s unique driver profile.

A car insurance deductible is the amount of money you agree to pay before your insurance company pays for a covered collision or comprehensive claim. Choosing a deductible amount is one of the biggest decisions you’ll make when shopping for car insurance.

For $500 deductible car insurance, the average cost of a six-month full-coverage policy is $1,470, Insurify data shows. Allstate, American Family, and Erie Insurance top the list as some of the best car insurance companies for policies with a $500 deductible.

Quick Facts
  • NJM offers the cheapest full-coverage policy with a $500 deductible, at $66 per month on average, but it’s only available in New Jersey, Pennsylvania, Ohio, Maryland, and Connecticut.

  • Car insurance typically costs more with a $500 deductible than if you choose a higher out-of-pocket amount.

  • Your deductible applies when your collision or comprehensive insurance covers a claim; liability insurance doesn’t have a deductible.

How car insurance deductibles work

When filing a claim for damage to your vehicle, your insurer typically requires you to pay a deductible before it picks up the remaining costs. You select the deductible amount when enrolling in your car insurance policy. Common options are $250, $500, and $1,000.[1]

Auto insurance deductibles are a way to share the financial risk between you and your insurance company. They apply to damage claims for your vehicle, not liability insurance claims, and you’ll pay them each time you file a claim.

A higher deductible can help you get a lower car insurance rate. But it means you’ll have to dig deeper into your wallet in case of an accident, so make sure you’re comfortable with the deductible amount you choose.[2]

Keep in mind if you have both collision coverage (for car crashes) and comprehensive coverage (for non-collision events), you might have two separate deductibles.

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Cheapest car insurance with a $500 deductible

In the table below, you can see 10 of the cheapest car insurance companies for a full-coverage policy with a $500 deductible, according to Insurify data.

Insurance Company
Average Monthly Quote: Full Coverage
NJM$66
Auto-Owners$94
Erie$109
Root$113
USAA$115
Mile Auto$123
State Farm$133
GEICO$137
Safeco$145
Allstate$159
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers. Actual quotes may vary based on the policy buyer's unique driver profile.

Best car insurance with a $500 deductible

You pay for your auto insurance coverage through regular premium payments, as well as a set out-of-pocket deductible if you file a comprehensive or collision claim for covered damages. If you buy a policy with a $500 deductible, you’ll owe $500 any time you file a claim for a car accident or other covered damages.

Some top insurers that offer policies with a $500 deductible include NJM, Erie, and GEICO.

NJM: Cheapest rates

Regional insurer NJM provides some of the most affordable $500 deductible full-coverage policies. With an average cost of $66 per month, it’s a good balance between affordable premiums and quality coverage. You’ll find several discounts to keep rates low, including bundling, multi-car, and good student discounts.

Pros
  • Cheapest rates for policies with a $500 deductible

  • Above-average J.D. Power claims satisfaction rating

  • Offers gap insurance and rideshare coverage

Cons
  • Available in only five states

  • Not all discounts available in all states

  • Not as many add-on coverages as some other insurers

Erie Insurance: Best for customer service

User Reviews
4.1
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
9.0 /10
Liability Only
Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages.
$50/mo
Full Coverage
Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible.
$93/mo
4.1
Best choiceBased on 231 verified guest reviews and ratings
How drivers feel about Erie Insurance

Drivers appreciate the excellent customer service, fair pricing, and responsive assistance. However, some are unhappy with unexpected rate increases and policy cancellations.

AI-generated from the text of verified reviews collected by Insurify
Best For
High customer satisfaction
Competitive rates
Optional coverages
How drivers feel about Erie Insurance

Drivers appreciate the excellent customer service, fair pricing, and responsive assistance. However, some are unhappy with unexpected rate increases and policy cancellations.

AI-generated from the text of verified reviews collected by Insurify
Best For
High customer satisfaction
Competitive rates
Optional coverages
Reviews (119)

Satina

October 28, 2024

Verified Review

Erie Insurance Unreliable

The service is not good, and they are unclear about some policy benefits like 24-hour towing, which is non-existent but included in the policy.

Lana

October 25, 2024

Verified Review

Expensive but Efficient Company

Erie provides excellent claims service if you ever need it, but their rates are fairly expensive. I've been with them for 55 years.

Shannon

October 19, 2024

Verified Review

Could be Better

I had an unfortunate accident and they were very helpful at the time managing the claim, so the company was great. My rate did go up which I expected and it was reasonable at the time. When my policy was supposed to renew the following year, they wanted to again increase my rate by almost $100 per month. The insurance broker I dealt with was very rude when I called about canceling my policy because unfortunately, I can't afford that kind of increase as a single parent with one income.
See all Erie Insurance reviews
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
870
NAIC Index
Average amount of customer complaints relative to competitors on a 0-5 scale. A lower score represents fewer complaints.
0.49
A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
A+
Why we picked this company

Erie is a top choice if you value excellent customer service alongside your $500 deductible. The regional insurance company has 14,000 licensed insurance agents and ranks highest in J.D. Power’s 2024 U.S. Insurance Shopping Study. It also earns high marks for claims satisfaction, ensuring a smooth experience if you need to file an insurance claim.

Pros
  • Excellent customer service

  • High J.D. Power claims satisfaction rating

  • Local agents for personalized service

Cons
  • Available in only 12 states and Washington, D.C.

  • Fewer digital tools than some insurers

  • Not as many discounts as some competitors

GEICO: Best for discounts

User Reviews
4.0
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
9.0 /10
Liability Only
Liability-only insurance, sometimes called minimum-coverage insurance, pays for bodily injury and property damage to others in an accident the policyholder causes. It does not pay for the insured’s own damages.
$55/mo
Full Coverage
Full-coverage car insurance generally includes liability, collision, and comprehensive coverage, and may include other optional coverages such as uninsured motorist coverage. Collision covers a policyholder’s repair or replacement costs in case of an accident. Comprehensive covers damages caused by non-accident events. The average quote displayed here reflects policies with the following coverage limits: $50,000 bodily injury liability per person; $100,000 bodily injury liability per accident; $50,00 property damage liability per accident; $1,000 collision deductible; and a $1,000 comprehensive deductible.
$121/mo
4.0
Best choiceBased on 10113 verified guest reviews and ratings
How drivers feel about GEICO

Drivers appreciate the excellent customer service and initial low prices but dislike the frequent price increases.

AI-generated from the text of verified reviews collected by Insurify
Best For
Teen drivers
Cheap rates
Accident forgiveness
How drivers feel about GEICO

Drivers appreciate the excellent customer service and initial low prices but dislike the frequent price increases.

AI-generated from the text of verified reviews collected by Insurify
Best For
Teen drivers
Cheap rates
Accident forgiveness
Reviews (5,563)

Herman

October 29, 2024

Verified Review

Excellent

For us, it came down to cost and having all of our insurance with the same company, not farmed out.

Greg

October 29, 2024

Verified Review

It's Expensive

It's expensive.

Robert

October 29, 2024

Verified Review

Unpleasant Experience on Cape Cod

My insurance has gone from $37 a month to $82. Stay far away from this company.
See all GEICO reviews
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
835
NAIC Index
Average amount of customer complaints relative to competitors on a 0-5 scale. A lower score represents fewer complaints.
0.74
A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
A++
Why we picked this company

GEICO has a lot of discounts, making it a great option for budget-conscious drivers. You’ll find savings for good driving, having certain safety features in your car, getting good grades, insuring more than one car, bundling policies, being a military member, and more. These savings support competitive rates for $500 deductible car insurance without sacrificing coverage options. It’s also available in all 50 states and Washington, D.C.

Pros
  • Numerous discounts

  • Easy online policy management

  • A++ (Superior) financial strength rating from AM Best

Cons
  • Below-average J.D. Power claims satisfaction rating

  • Higher rates for high-risk drivers

  • Few options to customize coverage

Why deductibles affect premiums

When you select a higher deductible, such as $1,000 instead of $500, you lower your premium because you’re agreeing to pay for more of the initial costs when you file a claim. This shifts some of the financial risk from the insurance company to you, allowing them to charge you less for your policy — 15%–40% less, according to the Insurance Information Institute.[3]

For example, suppose you have $500 deductible car insurance, and your monthly premium is $245. If you increase your deductible to $1,000, you could potentially shave $37–$98 off your monthly cost. That’s an annual savings of $444–$1,176.

Of course, a high deductible means you’d fork over more cash if you file a claim, so pick an amount of money that won’t strain your finances.

Shop for a $500 Deductible Insurance Policy

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Cost of $500 vs. $1,000 deductible

Opting for a $1,000 deductible instead of a $500 deductible can be a good option if you have enough savings to cover a bigger bill when you file a claim. A high deductible can reduce your car insurance premiums, but it increases your financial responsibility when filing a claim.

A good rule of thumb is to choose the highest amount you can afford. A $500 deductible might be more manageable for drivers without a large emergency fund, even though a smaller deductible translates into slightly higher insurance premiums.

Here’s a look at how much your monthly rates can change depending on the deductible you choose.

Deductible
Average Quote: Liability Only
Average Quote: Full Coverage
$500$120$245
$1,000$104$211
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers and quote estimates from Quadrant Information Services. Actual quotes may vary based on the policy buyer's unique driver profile.

Pros and cons of a $500 deductible

Pros
  • Pay less up front when filing a comprehensive or collision claim

  • Easier to fix your car without waiting

  • Less financial worry in case of an accident

Cons
  • Higher insurance premiums

  • Safe drivers may pay more over time

  • Filing multiple claims with a lower deductible could lead to rate increases and negate any savings

Other ways to lower car insurance costs

You have other ways to lower your premium besides increasing your deductible. If you prefer a lower deductible or have already chosen the highest deductible you can afford, you can try the following strategies to keep your car insurance costs low:

  • illustration card https://a.storyblok.com/f/162273/100x100/9cd41581f2/savings.svg

    Bundle insurance policies

    An insurer might reduce your premium if you buy multiple auto policies or different types of insurance from the company. For example, you can often get a discount for bundling your car insurance with renters or homeowners insurance.

  • illustration card https://a.storyblok.com/f/162273/x/ba9869f2f9/defensive-driving.svg

    Take a defensive driving course

    A defensive driving course can help you improve your skills behind the wheel, and courses usually cost less than $100. Successfully completing a course can earn you a discount of as much as 10% off your premiums, depending on your insurer.

  • illustration card https://a.storyblok.com/f/162273/150x150/1f77dd73f2/money-96x96-orange_042-invoice.svg

    Avoid unnecessary claims

    Filing lots of claims can lead to a higher premium down the line, so you may want to pay out of pocket for minor dings or scratches.

  • illustration card https://a.storyblok.com/f/162273/150x150/c766092b3a/banking-96x96-yellow_031-credit-card.svg

    Improve your credit

    Many insurance companies consider your credit history when they set your premium. Paying down credit balances, paying bills on time, and monitoring your credit report for errors might help raise your score and lower your insurance costs.

  • illustration card https://a.storyblok.com/f/162273/150x150/8329623678/money-96x96-blue_025-online-money.svg

    Compare prices

    The first insurer you approach won’t always offer the most affordable option. You may find a better rate if you get quotes from at least three different insurers.

$500 car insurance deductible FAQs

You have lots of things to think about when choosing an auto insurance policy. Consider speaking to an insurance agent if you have questions about specific policies from a certain car insurance company. Otherwise, find answers to help you navigate the process below.

  • Is it better to have a lower car insurance deductible?

    A lower auto insurance deductible may sometimes work better than a higher one, but it depends on what you can afford. A higher deductible results in lower premiums, but you need to have access to out-of-pocket funds in the event of an accident. Your policy deductible should be an amount you can comfortably pay out of pocket.

  • Which company has the cheapest full-coverage $500 deductible?

    NJM offers the cheapest full-coverage car insurance policy with a $500 deductible, with an average cost of $66 per month.

  • Is a $500 deductible good for car insurance?

    A $500 deductible is a standard option that helps balance lower premiums with manageable out-of-pocket expenses. What’s best for you depends on your individual financial needs.

  • What is a normal car insurance deductible?

    Normal car insurance deductibles range from $250 to $1,000. But $500 is the most common deductible amount, making it a good choice for most drivers.

  • When do you have to pay the $500 deductible?

    You pay the $500 deductible whenever you file a collision or comprehensive claim for covered damages, such as after an accident. Your amount is due before your insurance covers the remaining costs.

Methodology

Insurify data scientists analyzed more than 90 million quotes served to car insurance applicants in Insurify’s proprietary database to calculate the premium averages displayed on this page. These premiums are real quotes that come directly from Insurify’s 50+ partner insurance companies in all 50 states and Washington, D.C. Quote averages represent the median price for a quote across the given coverage level, driver subset, and geographic area.

Unless otherwise specified, quoted rates reflect the average cost for drivers between 20 and 70 years old with a clean driving record and average or better credit (a credit score of 600 or higher).

Liability-only premium averages correspond to policies with the following coverage limits:

  • Bodily injury limits between state-minimum rates and $50,000 per person, $100,000 per accident
  • Property damage limits between $10,000 and $50,000
  • No additional coverage
Full-coverage premium averages correspond to the same bodily injury and property damage limits in addition to:
  • Comprehensive coverage with a $1,000 deductible
  • Collision coverage with a $1,000 deductible

Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates.

Sources

  1. National Association of Insurance Commissioners. "Does your vehicle have the right protection? Best practices for buying auto insurance."
  2. Insurance Information Institute. "Understanding your insurance deductibles."
  3. Insurance Information Institute. "Nine ways to lower your auto insurance costs."
Amy Beardsley
Amy BeardsleyInsurance Writer

Amy is a personal finance and technology writer. With a background in the legal field and a bachelor's degree from Ferris State University, she has a talent for transforming complex topics into content that’s easy to understand. Connect with Amy on LinkedIn.

Sarah Archambault
Sarah Archambault
  • Experienced personal finance writer

  • Background working with banks and insurance companies

Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.

Featured in

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