I would resolve this matter promptly and to the full satisfaction of your employee, otherwise your company will end up in deep s**t.
I would have had no hesitation in contacting my own insurers there and then, it would have been well within my rights, and if you had tried to get into any negotiation about the extent of the damage, then I would have been on the phone before you had taken your next breath.
What for a miserly £500, that is a nothing to get any sort of body work/ paint work done to a car. All in all count your blessings it wasn't worse and someone wasn't injured or killed and take use the incident as a learning opportunity.