Blackjack Should You Buy Insurance
Taking insurance at the blackjack table is a bad bet most of the time. If you’re a basic strategy player or a seat of your pants player and don’t count cards, your best play is to always decline blackjack insurance. For most blackjack players who use basic strategy, but don’t count cards, it’s a good rule of thumb to just avoid insurance. In most cases, blackjack insurance is going to be a sucker bet. If you don’t want to spend the time and energy learning when insurance is an advantage play, don’t take it at all. The premise is that you can ‘insure’ a good hand against the risk of a blackjack. Say you’re holding a pair of 10’s and have a 20. That would typically be a pretty strong hand but if the dealer shows an ace you’ll be sweating it out. So should you buy ‘insurance’? To at least break even if the dealer does have a blackjack? Like splitting sevens in blackjack when the dealer has a six showing or doubling on a 10 against a dealer five. The only bet they print right on the blackjack layout, that the dealer always asks if you want, is insurance. Nobody hypes insurance to do you a favor. It's high-profit for the house. Except under certain circumstances. There are six varieties of outcomes if you place an insurance bet. The dealer has blackjack, and you do too. In this scenario, the hand is a push, also known as a tie, since you both have blackjack. You will receive your stake back, but you will also win the insurance bet, meaning you receive the insurance stake at 2-1 odds.
One seemingly good bet to beginning blackjack players is taking insurance. And a major reason why beginning players are fooled into thinking insurance is a good idea is because dealers ask players beforehand if they want insurance when the opportunity arises. However, this is a very poor wager, and we’ll get into the specifics of why after explaining more about this bet.
How Insurance Bets Work
The opportunity for insurance wagers arise when the dealer draws a face-up ace; at this point, the dealer will go around the table and ask everybody if they want to take insurance. The insurance is in case the dealer receives a blackjack, and you put out half of your original bet as the insurance. Assuming the dealer does have a blackjack, you win 2-1 on your insurance wager.
To illustrate how this works, let’s say that you make a $10 bet, and the dealer shows an ace. You then take the offered insurance bet by laying another $5 out on the table. The dealer turns over his second card, which is a king, thus giving him a blackjack. In this event, you receive win $5 on your insurance bet ($10 total), but lose $10 since the dealer had a blackjack. So basically, your overall bet was a push, and this doesn’t seem like such a bad deal so far.
Now, let us assume that the dealer didn’t have a natural blackjack; in this instance, you automatically lose the $5 insurance wager; however, you still have a chance to win the original $10 wager if your hand beats the dealer’s.
Why the Insurance Bet is Bad
Consult any source of blackjack strategy and they’ll tell you that insurance is bad. And the first thing you have to understand with this concept is exactly what insurance entails. Most players mistakenly assume that insurance is meant to protect their hand in the event that the dealer has a blackjack. But the reality is that insurance is merely a wager on the dealer having a natural blackjack.
The main number you want to concentrate on here is 9:4 odds – or rather, the odds against the dealer having a blackjack when they’re showing an ace is 9:4. To break this down further, let’s say you make $5 insurance bets 130 times; based on the 9:4 odds, you’d win your bet 40 times for $400 in total winnings ($10 total earnings X 40 bets). On the other hand, you’d lose 90 of these bets for $450 in total losses ($5 total losses X 90 bets). As you can see, this leaves you $50 in the hole, thus making it a bad bet overall.
I’ve written a few articles in the past that included advice that said you should never take insurance when you play blackjack. I stand by this advice because, for over 90% of the players who read my articles, the advice is 100% correct.
But I also need to present the other side of the argument to give you a complete understanding of insurance. The truth is that insurance is the correct play in a few specific situations. Most of these situations only become apparent to professional card counters, and because counting pros spend most of their time beating the casinos and not reading my articles, my advice of never taking insurance is correct for everyone else.
So why am I writing an article about taking insurance?
As you’re getting ready to learn, there are a few situations while playing blackjack when clearly it seems that taking insurance is a good bet. The odds are good that these situations are going to surprise you because they’re not why most players take insurance.
The Argument Against Insurance
The reason why taking insurance is a bad decision most of the time can be explained using simple math. But, as you’re going to see in the next section, this same simple math is used to show in a few situations that insurance is a good bet.
When the dealer has an ace, he or she offers insurance to the payers at the table. Insurance costs half of your original wager and pays 2 to 1 when the dealer has a natural blackjack. The only way the dealer has a natural blackjack is when his or her down card is worth 10 points.
The odds of the face down card being worth 10 points are 9 to 4 against. This is a percentage chance of 30.77% that the dealer has a blackjack. The reason why the odds are 9 to 4 is because of the 13 total card ranks, four of them are worth 10 points, and the other nine aren’t. The four 10-point value ranks are the face cards and the 10s.
When you compare 9 to 4 against the payout of 2 to 1, the casino has an edge. For the bet to be fair, the chances of the dealer having a blackjack need to be the same as the payout. The payout of 2 to 1 means that the percentage chance of the dealer having a blackjack needs to be 33.33%.
In any situation where the chance the dealer has a blackjack is over 33.33%, the insurance wager is a good bet.
The problem is that most of the time, the dealer doesn’t have a 33.33% or higher chance to have a blackjack. This goes back to how you compute the dealer’s percentage, or odds, based on the normal makeup of a deck of cards.
Determining the odds or percentages based on a normal distribution of cards in the deck sounds correct, but it assumes you don’t know the value of any cards. This is the safe way to do it, especially in a shoe game because a single card doesn’t change the odds or percentages much.
But what happens if you take the knowledge of cards played and remaining available in the deck or shoe into account?
Is there a way to use this information to determine when taking insurance is a good bet?
When You Should Take Insurance
Now that you understand how the math behind the insurance bet works, let’s look at a specific example where the bet changes from bad to good.
You’re playing in a single deck blackjack game.
- On the first round of hands, you see the value of 14 cards. Only one of them is worth 10 points, so the remaining cards have 15 cards valued at 10. With 14 cards played, the deck has a total of 38 cards.
- The second round of hands is dealt, and the dealer has an ace face up. You haven’t seen the value of the other player’s cards at this point, and you have a king in your hand. Now you’ve seen the values of 17 cards when you include the two in your hand and the dealer’s ace.
- The remaining unseen cards total 35 and 14 of them are worth 10 points. This means that the odds of the dealer having a 10-point value down card are 21 to 14 or 3 to 2 against. In other words, 40% of the time the dealer is going to have a natural blackjack.
A winning insurance wager pays 2 to 1, so the odds are better than that in this hand. The 2 to 1 payout means that the chance of a dealer blackjack needs to be at least 33.3%, and in this example, the chance is 40%.
While this example is an extreme one to show when insurance is a good bet, you can also learn something from it. Now that you know that the chances of the dealer having a natural blackjack need to be 33.3% or higher, you can use this information in any single deck blackjack game. You can even use it in a double deck game if you do a good job of tracking cards.
This is much like card counting in that you don’t have to memorize every single card that’s been played. All you need to do is keep track of the ratio of total cards played to 10-point value cards. This even works in shoe games, but the truth is if you’re able to keep track of this ratio in shoe games, you should be counting cards.
How Important Is This Knowledge?
While it’s important to recognize and use every small advantage you can find, the truth is that the opportunity to take insurance with an edge is rare. If you play in single and double deck games often, it’s something that you should watch for.
Blackjack Should You Buy Insurance Without
But you should only concern yourself with profitable insurance opportunities after you do a few other things to lower the house edge. The first thing you should do is find blackjack games with good rules. The next thing every blackjack player should do is use basic strategy. It’s a waste of time and energy to worry about insurance before you do these two things.
Once you learn about the rules and learn how to use perfect strategy, then you can start looking for opportunities to take advantage of insurance. But even in this situation, I recommend looking for insurance opportunities as an introduction to learning more about counting cards.
When you start tracking card ratios, which is at the heart of determining when taking insurance is a good bet, you’re starting to use the same techniques card counters use. And the fact is that most popular card counting systems include a breakpoint where players start taking insurance.
If you’re looking for every possible edge at the blackjack table, understanding how insurance works and when you should take it is important. But if you don’t want to do the extra work, then stick with good rules and proper strategy. By declining insurance every time, you’re not going to make a mistake often. When you do, it’s only going to cost you a small amount over time.
It’s a much more costly mistake to take insurance when you shouldn’t than to miss an opportunity to take insurance every once in a while, when it’s the correct play.
Conclusion
Blackjack Should You Buy Insurance Online
Taking insurance at the blackjack table is a bad bet most of the time. If you’re a basic strategy player or a seat of your pants player and don’t count cards, your best play is to always decline blackjack insurance. But as you can see from the numbers included in this article, there are certain situations when insurance goes from a bad bet to a good one.
Once you master basic blackjack strategy, start looking for opportunities where insurance is a good bet. When you start recognizing these opportunities, it’s a good sign that you’re ready to investigate card counting. It’s a small step from understanding and using what you learned above to become a successful card counter.