Car Insurance With a $500 Deductible

A car insurance deductible is the amount you pay out of pocket before your insurer pays the rest of a covered comprehensive or collision claim. If you have a $500 deductible on your auto policy and a hailstorm causes $2,000 in damage to your car, you'd pay $500 and your insurer would cover the remaining $1,500. The deductible applies separately to comprehensive and collision coverage and doesn't affect liability claims, which pay for damage or injuries you cause to others.

Deductibles only come into play when you file a claim for physical damage to your vehicle. Choosing the right amount depends on your savings, your vehicle's value and how often you're likely to file a claim.

Full coverage options with a $500 deductible cost an average of $135 per month ($1,616 per year) for a male adult driver with good credit and a clean driving record, based on MoneyGeek's analysis of 14 major insurers. Rates vary by insurer, and the cheapest option (GEICO at $95 per month) is $104 per month cheaper than the most expensive option, AIG at $199 per month.

The table below shows average monthly and annual rates for each insurer, along with how each compares to the $135 national average.

*Rates are for full coverage with 50/100/50 liability limits and a $500 comprehensive and collision deductible.

GEICO is the most affordable insurer for a $500 deductible policy at $95 per month ($1,146 per year), 29% below the national average. Travelers follows at $99 per month ($1,187 per year), which is 27% below average. Both options cost well under $100 per month for drivers with good credit and no recent violations.

A $500 deductible is the most common choice among full coverage policyholders because it balances monthly savings against out-of-pocket exposure. Choosing a lower deductible (say $250) reduces what you pay per claim but increases your monthly premium. A higher deductible, like $1,000, cuts your premium but means you'd need $1,000 available immediately after a covered accident or weather event. Learn more about how to choose a deductible that fits your financial situation.

The right deductible depends on two factors: how much cash you can access quickly if you need to file a claim and how much your vehicle is worth. If your car is worth $4,000 or less, full coverage may not make financial sense regardless of deductible level. A payout after a total loss may barely exceed what you'd pay in premiums over time.

Your deductible directly affects your premium: higher deductibles lower your monthly cost, while lower deductibles raise it. The $500 deductible is the standard midpoint insurers price around. Drivers who raise their deductible from $500 to $1,000 can cut their comprehensive and collision premium by 10% to 25%, though the exact savings vary by insurer and state.

Raising your deductible makes financial sense only if you can cover the higher amount after a loss. A $1,000 deductible that saves you $20 per month takes four years to recoup if you file one claim, but you'd save money over time if you're a low-claim driver. See how deductibles impact insurance rates across different driver profiles.

Full coverage with a $500 deductible costs $135 per month on average, but GEICO and Travelers each offer rates under $100 per month for drivers with good credit and a clean record. A $500 deductible is a sound default choice: low enough to be manageable after a claim, high enough to keep monthly costs reasonable. Compare quotes from at least three insurers before buying, and ask each one about available discounts.

MoneyGeek analyzed car insurance rates from 14 major insurers for a full coverage policy with 50/100/50 liability limits and a $500 comprehensive and collision deductible. Rate data comes from Quadrant Information Services.

The sample profile is a male adult driver with good credit and a clean driving record. This baseline profile represents a standard low-risk driver and allows for direct comparisons across insurers. Rates will be different for drivers with violations, poor credit, younger age, different vehicles or different ZIP codes.