Losing Your Insurance Bet?

Blackjack Insurance: Is it a Sucker Bet?

By Arnold Snyder
(From Casino Player, May 1997)
© Arnold Snyder 1997

Question from a Player:  My problem is that I have this feeling that I’m taking insurance far too often. I lose this bet a lot, even though I only take insurance when my true count is +3 or more. (I’m playing mostly in six-deck games in Mississippi and Louisiana.)

On my last trip, I put in 19 hours at the tables over a three day period. I kept track of all my insurance bets. I took insurance 14 times, won 5 times and lost 9 times. I realize this is a very short test from the statistical point of view (I’ve been reading your column for years!), but my experience on all of my trips is similar to this. I lose the insurance bet way more than I win it. This is just the one trip where I kept track of my results.

What’s worse, when I win the bet, I don’t really win anything, I just break even on my hand. Winning is actually more like pushing. When I lose the insurance bet, however, I not only lose the insurance, but I still have to play the hand against a dealer ace, which also often loses. I’m starting to think this insurance bet is just a sucker bet for card counters.

Blackjack Insurance: A Side Bet, Nothing More

Answer:  Many players are confused about the way insurance works because, in casino jargon, you are “insuring your hand.” Insurance is a side bet, and has nothing to do with the results of your blackjack hand.You are simply betting that the dealer has a ten in the hole. If he does, you win 2-to-1. It is not a “push” for your hand.

For example, you have a $100 bet on the table. You have a 16 vs. a dealer ace. Let’s say the insurance bet does not exist. The dealer peeks at his hole card, flips over a ten, and you lose your $100.

Now, assume insurance is offered. You have a true count of +5, so you put out $50 for insurance. Now, when the dealer flips over his ten, he pays your $50 insurance bet at 2-to-1 ($100), but you still lose your hand, so you break even.

Since, without the insurance bet, you would have been minus $100, this $50 bet gained you $100.

The actual result on your blackjack hand will be exactly the same regardless of whether or not you take insurance. If, for example, the dealer has a blackjack, you lose; if not, then you have to play out your hand vs. whatever he does have.

Also, your analysis of your blackjack insurance results indicates that you did pretty close to what you would expect as a card counter. For the sake of simplicity, let’s say all of your insurance bets were $50 each. Since you lost 9 times, this is a $450 loss; since you won 5 times (at 2-to-1), this is a $500 win. So, you’re $50 ahead of where you would have been had you never taken insurance.Technically, your fourteen $50 insurance bets would total $700 in action. A $50 win total on $700 action would mean that insurance has paid you at the rate of 6.67% — which is more likely a positive fluctuation in your favor than a negative one.

Remember, if you win your insurance bet just half as often as you lose it, you break even. So, it will always seem like you lose this bet more than you win it, even when you are making money on it.  ♠