Blackjack Insurance: Always a Bad Bet

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The term “Insurance” is used to define a form of protection from financial loss. It is a very safe thing to do. You can insure your house, car, and belongings against accidental damage. This makes it all the more strange when you hear the term associated with the turbulent game of blackjack. 

When playing blackjack, insurance can only be taken in certain circumstances. However, it does what it says, giving you a chance to break even on certain dealer hands. Below, we discuss blackjack insurance and why it is always a bad bet. 

What is Blackjack Insurance?

Insurance is a slightly misleading term for this option in blackjack, as it is essentially a side bet. Once the cards have been dealt, if the dealer’s up card is an ace all the players will be offered the chance to take ‘insurance.’ The bet is made just before the dealer checks the hole card. 

This is a bet made against the probability that the dealer will get a 10-value card to accompany their ace, creating blackjack. If they do, then the players will get a payout that sees them break even. To do this, the cost of a bet is usually half the amount of the player’s main wager and pays out at 2/1. 

While there are some detractors from the insurance side bet, it does offer some advantages. Players can break even, even if they lose the main bet. 

Blackjack Insurance Winning Examples

You place a bet of $20.

Your hand is a nine and a queen. This gives you a value of 19.
 
The dealer has a face card which is an ace. You are offered the insurance bet. 

The insurance bet is taken. It costs half your initial bet, which is $10.
 
The dealer turns their card over to reveal a card with a value of 10. Giving them a combined total of 21 they now have blackjack. 

As a result, you win the insurance bet. This pays out at 2/1 so you manage to break even. 

Blackjack Insurance Losing Examples

You make a bet of $20. 

The dealer gives out the cards. You have a 7 and a queen. This gives you a hand of 17.

The dealer’s up card is an ace. You are offered the insurance bet and take it. 

The insurance bet is half of your initial bet, so you put down $10.
 
The dealer reveals a 5. As they don’t have blackjack, you have lost the $10 insurance bet, but keep your $20 original bet. 

The game then continues to see if the dealer can beat your total of 17. 

Blackjack Insurance Odds

The odds of blackjack insurance are determined by several factors. The most obvious is how many decks are in the shoe. Knowing how many 10-value cards have already been dealt can also change the odds. 

However, blackjack insurance states that the dealer’s other card has around a one in three chance of being a value of ten. This can sound quite appealing. Despite this, when playing, over time blackjack insurance does not offer favourable odds. Chances are if the dealer does have blackjack, you are more than likely to lose the main bet. Insurance will only see you break even, not make a profit. 

Is Blackjack Insurance a Good Idea?

Most experts will advise against blackjack insurance. It should only really be used by seasoned professionals. Even then, it still does not offer good enough odds to payout ratios.
 
For example, imagine you play against a dealer in a one-deck game. You do not have any 10-value cards in your initial hand. This is the best-case scenario as now, 16 of the cards remaining have a value of 10. This means your insurance has the best possible chance of coming up. 

Long term though, this is not great. Assuming all your blackjack insurance bets have this most likely outcome (it is very unlikely they will) then you would still encounter a loss. If you play 49 times, the bet has an average of 16 wins and 33 losses. If you bet $10 each time, making $20 back, this would bag you $320. However, bet this with the losses and you come out $10 short. Add to this that most games do not have a one-deck shoe and that other players may have 10 value cards and predicting the probability becomes a tough one anyway.

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