If you opt for full coverage when choosing your auto insurance policy, the insurance company will ask you to select your auto insurance deductible amounts. A deductible is the amount you would be responsible for paying out of pocket if you file a covered disclaimer claim on your policy. Many people choose a $ 500 deductible for their collision coverage and comprehensive coverage. Since deductibles are tied to the amount you pay in premiums, knowing your best auto insurance options helps.
Below, Bankrate’s insurance editorial team explains how much auto insurance costs with a $ 500 deductible and what are the best auto insurance companies to consider if you’re looking for a policy.
What is an automobile insurance deductible?
An auto 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 may also apply to personal medical expense claims. While insurance premiums are the amount you pay to insure your car for a period of time, your deductible only applies when you make a claim for covered physical damage. Deductibles are generally available in increments ranging from $ 0 to $ 1,500, and the amount you choose affects how much you pay for premiums. Most people choose a deductible between $ 500 and $ 1,000.
If you caused an accident, your liability insurance will cover the medical costs and property damage of the other party. You will not have a deductible linked to this amount. However, you will usually find an auto insurance deductible tied to a Comprehensive Collision or Injury Protection (PIP) claim that you make with your vehicle. You may also have one for uninsured or underinsured property damage claims. The types of coverage to which a deductible applies may vary from state to state. A licensed insurance agent can help you with the appropriate deductible for each coverage.
Cost of auto insurance with a $ 500 deductible
The average cost of auto insurance with a $ 500 deductible is $ 1,674 per year for a full coverage policy, based on Bankrate’s 2021 study of annual premiums offered. Bankrate’s sample driver profile includes a $ 500 collision deductible and full coverage. However, your rate is likely to differ from the national average depending on various personal factors, such as your condition, policy options, and the insurance company. A licensed insurance agent can work with you to show you exact quotes based on your personal factors.
Best auto insurance with a $ 500 deductible
A $ 500 deductible is a fairly common choice, which means you should be able to find quotes from many vendors with that deductible amount. The table below includes examples of the best auto insurance with a $ 500 deductible in 2021 determined by Bankrate’s analysis of average annual premiums.
|Auto insurance company||Average monthly full coverage premium||Average annual premium for full coverage|
|Erie||$ 103||$ 1,233|
|Geico||$ 117||$ 1,405|
|State farm||$ 121||$ 1,457|
|Travelers||$ 110||$ 1,325|
|United States||$ 102||$ 1,225|
A full coverage policy, which typically refers to a policy that includes liability, full, and collision liability coverage, offers better financial protection than buying the bare minimum. However, there are other options available for additional financial protection. For example, gap insurance helps close the “gap” between the amount you owe on a lease or loan and the amount at which an insurance company appraises your vehicle, if your new vehicle is destroyed in a car. accident covered or if it is stolen and cannot be reinstated.
Is it better to have a higher deductible?
Deciding whether it is better to have a higher or lower deductible is an individual choice and based on your financial situation. While a higher deductible usually results in lower overall premiums, it also means you’ll have to pay more out of pocket in the event of a collision or full claim with your vehicle. Many financial experts recommend having enough savings to cover the deductible amount at all times. For example, if you have a at-fault car accident and your vehicle is damaged, your repair costs will reflect the amount you selected for your deductible.
The table below illustrates the difference in premiums when you choose a $ 500 deductible versus the $ 1000 option. By selecting the highest deductible option, the national average premium savings are $ 215. Whether it is better to pay less up front and have to pay more out of pocket if you have to make a claim is up to your personal and financial circumstances.
How to keep auto insurance rates low
The deductible is only one piece of the puzzle in determining your overall insurance premium. If you are looking for other ways to save on your auto insurance policy, be sure to check out any available discounts offered by the provider. There may be some available that you weren’t even aware of. Staying safe from claims and accidents, as well as ensuring a safe vehicle, could also help you get a lower rate. Your driving history and your claims history are two main factors insurance companies use to determine how much you will pay.
Bankrate uses Quadrant Information Services to analyze 2021 rates for all zip codes and carriers in all 50 states and Washington, DC Rates shown are based on a 40 year old male and female driver with a clean driving record, credit and the following comprehensive coverage limits:
- $ 100,000 liability for bodily injury per person
- $ 300,000 liability for bodily injury per accident
- Civil liability for property damage of $ 50,000 per accident
- $ 100,000 in bodily injury caused by an uninsured motorist per person
- $ 300,000 in uninsured bodily injury per accident to a motorist
- $ 500 collision deductible
- Global deductible of $ 500
To determine the minimum coverage limits, Bankrate used a minimum coverage that meets the requirements of each state. Our basic profile drivers own a 2019 Toyota Camry, commute five days a week and cover 12,000 miles a year.
These are sample rates and should be used for comparison purposes only.