Even Money vs. Insurance

Two different names. Two different things right? You might be surprised.

Let’s say that you have a natural blackjack and the dealer has an Ace for an up card. You’re offered even money. Should you take it or not?

No, you shouldn’t.

You have the chance of winning a 3-2 payout. Why throw it away to settle for 1-1 blackjack payout? It’s kind of like having a winning argument and then backing down with meek deference.

So rather than take the even money you think you might want to insure your blackjack. You don’t want to do that either because it’s the same thing. You will come out with the same amount of money.

I’ll show you how this works. Let’s say that you have wagered $10 and you have that blackjack against an Ace. We’ll say that you take insurance on your hand, so you put forth $5. But it turns out that the dealer doesn’t have blackjack. He’ll take your $5 insurance bet…and then pay you $15. Now subtract the $5 you lost to insurance, and you’ll find that in reality your payout was only $10. Which is the same thing as taking even money.

See how it doesn’t matter whether you insure your blackjack or take even money on it?

Oh but wait! What if the dealer does have blackjack too and you have taken insurance? In that instance your blackjack would push his. And you would collect $10 on your insurance bet. It’s still the same $10 profit.

What even money does is simplify the steps in giving you the same amount you would win if you took insurance on your blackjack. But dealers don’t get a 10 for a hole card often enough to warrant taking insurance or even money in any case. Your best bet is to decline both and stick with your basic strategy.

That Insurance Thing

It seems that I’m seeing more and more about blackjack insurance—both land-based and online blackjack. There are people that say it’s a good thing and other that say it’s not all that great.

I would be one of those people…one of those that doesn’t think insurance is a great thing.

But then I don’t like side bets either.

Did you know that insurance is a rather sneaky side bet that casinos try to pull you in with? They want you to think that you can save your hand and part of your money for a little bit more money, of course.

But really you’re not saving anything. At best you’ll wind up with the same amount of money that you wagered (more on that jewel tomorrow), and at worst you’ll lost more money.

Here’s the thing—insurance is a side bet. And there’s no other way to look at it.

You’re only offered insurance when the dealer is showing an Ace. A natural blackjack is made up of a 10 value card and an Ace. Since an Ace is the less likely to show than a 10, the dealer will offer you insurance when he’s showing one.

Insurance is to save part of your bet in case the dealer has a natural blackjack. Meaning, in case he has a card worth 10 for a hole card. You can only collect on insurance if the dealer has a natural blackjack. Again, you can only collect if he has a 10 hole card.

And that is a side bet. You are making a side wager on whether his hole card is worth 10. And you’ll win that side bet if it is a 10.

But it comes down to losing money faster since you’re wagering more money per round than if you declined. And you will notice that serious blackjack players won’t take insurance. That’s a pretty good cue to follow.

Insurance Not Good for Basic Strategy

Insurance is a much debated play in blackjack. To take it or not? And the school of thought seems to be split pretty evenly, with one side believing that if they have blackjack and they take insurance that they are guaranteed even money, odds aside.

What insurance really is, is a side bet on whether the dealer’s hole card is a 10 or not. Basic strategy is designed to not take insurance. So if you want to maintain that house edge being lowered to 0.05% then you need to not take insurance.

This is because insurance increases the houses edge. Which will really mess up that 0.05%.

Here’s how insurance will mess up the lowered house edge that basic strategy can give you:

We’re going to say that in a game of online blackjack that the RNG is polling results by taking into account six decks, which is what you will usually find in a blackjack game in Vegas. With six decks in play there are 312 cards.

Now the dealer has an Ace, so subtract one card from the 312; you now have 311. Now let’s count how many 10 value cards we have. There are four cards per suit, and four suits per deck, which makes sixteen 10 value cards per deck; with six decks, that is ninety-six 10 value cards. And any one of those ninety-six cards could be the hole card. That’s what the casino is hoping you will bet on.

Now comes how all that translates into odds. There is a 96 out of 311 chance that the hole card will be a 10 value card. And translates to 30.868% that the hole card will be worth ten, and 69.132% that it won’t be.

So if you are taking insurance you’re taking it on the 30% chance. Not the smartest move. Why wager on the likely of outcomes?

Now on to how this impact the edge. To figure the edge impact, multiple the payout per dollar by the chance of winning, then subtract the chance of losing: 2×0.30868-0.69132= -7.395. See that negative sign? Negative signs mean that the house is favored.

Taking insurance gives the house an increase of about 7.395%.

By taking insurance, you are throwing the 0.05% that basic strategy gives you out the window.

So if you’re playing according to basic strategy, you will want to decline insurance . Keep in mind that only about 30% of the time will the hole card be a 10 value card, and that taking insurance will increase the house edge by about 7%. Taking insurance doesn’t do you any favors.

Blackjack Philosophy No-No’s—Part VII

Raise your hand if you like losing money?

No hands? I didn’t think so.

We’re going to take a look at a bad play that is also another player contrived blackjack philosophy. It’s also a no-no.

In your time playing blackjack you are bound to come across other players who are set on insuring a 20. There are only two hands that you can have to have 20 and be in the position to take insurance: an Ace-9 and 10-10.

Both of those are two of the strongest hands that you can have. The only thing that can beat them is a dealer blackjack or a dealer hitting to 21.

Really quick, let’s review what insurance is. Insurance is offered to you when the dealer is showing an Ace. Insurance is offered because blackjack is played with everyone assuming that the dealer’s hole card is a 10. Hence insurance is offered. And hence insurance is really a bet of whether the dealer’s hole card is a 10. That’s what insurance really is.

So let’s say that you have been dealt 10-10 and the dealer is showing an Ace; do you take insurance?

No. Insurance is a side bet on whether the dealer’s hole card is a 10. And you have two of those 10s in your hand. Not a bright move.

Insurance overall will cost you more money than you will save, and it’s best to be brave, not take it and play on.

Insuring a $10 bet means putting $5 more out on the table. If the dealer has blackjack you’ll get your $5 insurance back and half of your bet–$5. At the end of that round you get to keep $10 but you have given up $5 to keep that $10.

Overall, insurance is designed to give the casinos more of your money. And unless you know the principle inside and out and know the only times to insure your hand, just decline and play on.

The Mystery that is Insurance in Blackjack

When playing blackjack online or in a casino, at some point in time you have most likely been offered insurance. There are a lot of notions out there as to whether insurance is a good bet or a waste. So which is it? Or is it both?

First, let’s take a look at what insurance is.

The way that it is explained to you, is that an insurance bet is to protect you from losing all your money in case the dealer has a natural blackjack. Insurance is only offered when the dealer’s up card is an Ace—one of the cards that is required to have a natural. The reason insurance is offered on Aces and not on ten value cards is because Aces are smaller in number than the ten value cards and less likely to appear.

Now, insurance is really a side bet on whether or not the dealer’s hole card is a ten value card. You are making a 2-1 bet on what that card is. If it is a ten value then you get the 2-1 payout. And if the hole card isn’t worth 10 then you lose your insurance bet.

When looking at all the outcomes of making an insurance bet, you will find that there are three winning situations, two losing and one push. You will win money if you and the dealer both have naturals, if you have blackjack and the dealer doesn’t, and if neither of you have blackjack and you win the hand. You lose if neither of you have blackjack and you lose the hand, and if neither of you have naturals and you tie the hand. The only push outcome happens when you don’t have blackjack and the dealer does.

So three winning chances and one push versus two loses sounds pretty good right?


Let’s look at this from a statistical point of view, because, let’s face it, we are dealing with numbers and probability. Let’s say we’re talking about an infinite shoe, and since most tables use six to eight decks and online casinos have RNGs, we might as well think of them as infinite. With that number of decks or an RNG, there is a nine-to-four odds against the hole card being worth 10; this is because for every four ten value cards there are nine others.

Now we’ll combine math with statistics. Let’s say that in one year you make a $5 insurance bet 1300 times (considering how often a dealer has an Ace up card that’s a lot of blackjack). Going off of the nine-to-four statistic, you’d win 400 times and lose 900 times.

Translate that into money now. Winning a $5 insurance would give you $10. So if you won 400 times you would have made $4,000. For every time you lost a $5 insurance bet you would lose that $5. So losing 900 insurance bets means that you have lost $4,500. Add $4,000 and a negative $4,500 and you are left with a loss of $500.

And that is why, for the most part, you do not take insurance in both online blackjack and land based blackjack.

However, if you’re a card counter, there is an instance when taking insurance can be profitable.

Keep an eye open for Card Counting and Insurance.