A "100 year storm" is a storm with a 1% probability of occurrence within any given year.[1] So a 500-year storm has an 0.2% annual occurrence probability.
Those of us who understand probabilities immediately recognise that even assuming the base-line probabilities are correct, this will occur far more frequently than once in 100 years.[2]
And of course, the probabilities require a known historical distribution, which itself changes over time (climate change being only one of multiple factors). It is possible to make inferences based on the observed rate vs. intensity or magnitude of events. In many cases these follow an inverse-log relation, such that order-of-magnitude greater intensity events occur with an order of magnitude less frequency. Tracking the more-frequent, lower-intensity incidents actually gives a good proxy for how often higher-intensity events will occur.[3]
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Notes:
1. "The 100-Year Flood" <https://www.usgs.gov/special-topics/water-science-school/sci...>
2. A 1% probability event has a 99% probability of not occurring. For a period of time, raise 0.99 to the power of the periods occuring. Over a 100 year period, that's 0.99^100, or a 63.4% chance of no such events occurring. For the probability of k occurrences over n periods you'd apply the binomial distribution: <https://en.wikipedia.org/wiki/Binomial_distribution>.
3. This is a relationship which applies to a whole host of events, and is very frequently observed in general physical phenomena. Asteroid impacts, earthquake intensities, volcanic eruptions, storms, wildfires, terrorist attacks, and the like.