• Insurance Blackjack Payout Options
• Insurance Blackjack Payout Payouts
• Insurance Blackjack Payout 2020
• When To Take Insurance Blackjack
• Insurance Blackjack Payout Rules

Michael Shackleford: Hi guys, this is Mike and the purpose of today's Wizard of Odds Academy lesson will be to explain why you should never take insurance in Blackjack. What insurance is, is a side bet that the dealer has a 10 point card in the hole.

It is offered when the dealer already has an ace up, so it wins in the event that the dealer gets a blackjack. The insurance bet can be made for up to half of the player's original bet and it pays two to one if it wins.

This is to help new or aspiring Blackjack dealers to memorize the payouts for a blackjack. Terms in this set (30) 0.50 Blackjack. The insurance bet pays off at 2-to-1 odds, which means that you break even on the hand. If the dealer checks and there is not a card underneath that completes a two-card 21, you will LOSE the insurance bet and both sides will play out the rest of the hand as normal.

I'm going to…

…put a two for the pace if the dealer has a 10 point card in the hole and a negative one if the dealer has an ace and a nine which represents that the player lost his insurance bet.

Let's assume six packs of cards, shall we?

Assuming no other information other than the ace up the dealer already has, there are 96 winning cards for the insurance bet, 16 times 6 out of 311 left. There's 311 because a full six-deck shoe is 312 cards and we take one out because of the dealer's ace, and there are 215 cards that will cause the insurance bet to lose.

Let's take the product of the win and the probability.

2 times 96 over 311 is 61.74% and 215 divided by 311 times -1 is -69.13%. In other words, the player can expect to win 61.74% of his bet and lose 69.13% of his bet. We take the sum which is -7.40%. That means that for every dollar the player bets on insurance, he can expect to lose 7.4 cents or 7.4% of whatever his insurance bet is.

7.4% is a pretty high house advantage and consequently, I recommend that you say no to insurance every time. Before someone says in the comments, 'Mike, what if the count is good? What if I'm counting cards?'

Yes. Then, of course, there are exceptions. If you've been counting cards and you know that the remaining cards are very 10 rich, but for the recreational player that's not counting, insurance is a terrible bet and, again, I recommend you decline it every time.

'What about even money?'

You might be asking me. Well, let me explain to you first of all, that the even money offer is the same thing as taking insurance. It's only offered when the player already has a blackjack and the dealer has an ace up.

Let's look…

…at what would happen both ways if the player has a blackjack and takes insurance. If the dealer ends up getting that blackjack, the main bet will push, so it wins nothing, but the insurance but will win one unit because the player bets half a unit on insurance. The insurance but pays two to one on the winning blackjack. One-half times two equals one.

Next…

If the dealer does not get that blackjack, the player's main wager will pay one and a half but he will lose half a unit on the insurance. The combined when between the main wager and the insurance wager is one unit when the dealer does get a blackjack and one unit when the dealer does not get a blackjack.

It doesn't make any difference whether or not the dealer gets a blackjack. If the player has a blackjack and takes insurance, he wins one unit either way and what the dealer is essentially saying is, 'Look, if you take insurance, you're going to win one to one regardless if I have a blackjack. I may as well just pay you now before I even check what I have.”

It sounds attractive but let's do some math and see if you should take it. Let's evaluate the situation where the player has a blackjack, the dealer has an ace up and the player declines insurance. If the dealer has a 10 in the hole, then the player will win nothing because it will be a blackjack against blackjack tie, in other words, a push. If the dealer has anything else in the hole, the player will win his full three to two on his wager or 1.5.

Let's assume:

knowledge of no other cards in the shoe other than what's already on the table. There are 309 cards left out of the 312 card shoe, less than three cards already involved, the player's ace and 10 and the dealers ace.

The probability that the dealer has a 10 in the hole is 95 divided by 309. Like I just said, there's 309 cards left, the shoe started with 96 tens but the player has one of them. The chances that the dealer has an ace to 9 in the hole is 214 divided by 309.

Let's examine what the player can get back either way:

If the dealer does have that 10 in the hole, the player can expect to get back nothing because the probability of zero times anything is zero. If the dealer does not have a 10 in the hole, the player can expect to get back 1.5 with a probability of 214 divided by 309. The product of those two numbers is 103.88%. If we add them up, it's obvious you still get that same 103.88%.

What this means is…

…if the player has a blackjack, the dealer has an ace up, the player can expect to win 1.0388 times his bet or about 104% of whatever he bet. The decision to whether or not to take even money is the decision; do you want to get back an average of 103.88% of your bet or just 100%?What's more? 100% or 103.88%? Well, 103.88% is more, therefore, if you're seeking the greater expected value, which you should be in any casino game, you should decline even money and go for that 103.88%.

Few caveats here:

Number one - again this is assuming the player is not counting cards, just a recreational player. Number two - this is assuming that a blackjack pays three to two.

Finally, this question has come up on my forum every once in a while and a lot of people use the argument that yes, I make a good mathematical argument for declining an insurance even money but what about the psychological argument?

If you’re in this situation with a blackjack against the dealer ace, some people will say you have a 100% chance of being happy by taking the even money, locking in a sure win but only a 69.26% chance of being happy by declining the even money.

Those figures are right but…

…in the casino as well as real life, you should be long-term minded. You should be thinking what is the expected average gain for any decision that you make? Do not always play conservatively and lock in the small win when the average win by taking a chance is greater.

Of course, there are exceptions for life-changing situations but if you’re playing Blackjack, it assumes that you like gambling, to begin with. You’re in the casino you’re gambling, gamble on winning that full one and half, don’t settle on the measly one unit. Furthermore, even if you do use this argument of I want a 100% chance of being happy right now, I’ll take the even money. That happiness is only going to last less than a minute until the next hand.

I think…

…you should be thinking what is going to be your happiness when you finally walk away from the table and you go home for your trip? The more money you win or the less money you lose from that sitting and the whole trip, the happier you’re going to be.

Furthermore, you’re going to get more, shall we say, action by taking that chance on winning with your blackjack. Like I said you’re gambling, to begin with, so gamble!

I can’t think of anything else to say on this topic. I hope that I’ve convinced you to always say no to insurance and even money.

Thanks, guys for listening and I’ll see you in the next video.

Use the Rubik Cube solver program to calculate the solution for your unsolved Rubik's Cube.

Anyone who’s read a reasonably good post about basic strategy in blackjack knows that you should never take insurance. It’s a sucker bet.

But sometimes casino dealers will confuse players by offering them “even money.” That’s just another way of offering insurance to the player.

The selling point of even money in blackjack is that you’re going to win no matter what. This post explains the fallacy behind thinking that insurance (or even money) is a good idea when playing blackjack.

How Even Money Works in Blackjack

Even money works when you’ve been dealt a natural, a two-card hand that totals 21. Such a hand is also called a blackjack, and it pays off at 3:2 in most games.

There’s one catch to having a natural. If the dealer also has a blackjack, it’s a push. When the dealer has an ace showing as the face-up card, you get the opportunity to place an insurance bet. They’ll often refer to this as taking “even money.”

If you have $100 in action and agree to take even money, the dealer will pay you $100 and take your cards before looking at her hand to see if she has a blackjack, too.

This seems like a good idea. After all, if you turn down the even money, and the dealer flips over a blackjack, you lose your $100.

On the other hand, if you decline even money, you win $150 on your $100 bet. Which is the better deal?

It’s about how much you win or lose in the long run.

To really understand whether even money makes sense, you need to look at how often the dealer will win or lose and how much you’ll win on average every time.

Decisions and Consequences in This Blackjack Situation

Let’s simplify this for a minute. You have two choices. You can take even money and win $100. Or you can decline even money, winning either $150 or facing a push.

It should be obvious why declining even money makes sense, because when you push, you don’t lose any money. You just get your original bet returned to you.

How often will the dealer have a blackjack?

This varies based slightly on how many decks are in use, but for the sake of simplicity, let’s assume that the dealer will have a blackjack only 30% of the time (this is really close to the actual number). 70% of the time, you’ll win 3:2 on your bet.

Let’s play this situation out 100 times in a row.

• Player A takes even money, which means he wins $100 on all 100 hands, or $10,000.
• Player B declines even money, which means he wins $150 on 70 hands, or $10,500.

Obviously, declining even money results in more wins in the long run.

What’s the Difference Between Even Money and Insurance?

Insurance is a side bet that the dealer has a 10 as the hole card. You can only place this bet when the dealer has an ace showing face-up, and the wager for this must always be half of the original wager size. If you bet $100, your insurance bet must always be $50.

If the dealer does have a blackjack, you get paid off at 2:1 for your insurance bet, which means it pays off at $100.

You don’t need to have a blackjack to place an insurance bet. You can take insurance with any total versus the dealer’s face-up card. If you have any total other than 21, you lose your original bet against the dealer.

But since insurance pays off at 2:1, you’ll wind up breaking even on that action.

So basically, even money is just an insurance bet that you can only make when you have a blackjack. When you take even money, though, you lose your opportunity to get the 3:2 payoff.

You don’t have to put up the additional bet, because the casino has just subtracted that $50 from your payoff for your hand.

Insurance is available any time the dealer has an ace showing, but even money is only available when the dealer has an ace showing and you have a blackjack.

There’s An Exception to Every Rule

Insurance Blackjack Payout Options

Not every blackjack game in every casino offers 3:2 payouts for a blackjack. In some games in some casinos, the payout for a blackjack is only 6:5.

Insurance Blackjack Payout Payouts

You should NEVER play in such a game, because it gives the house an edge almost 1.4% higher than it would have if it paid the standard amount.

Insurance Blackjack Payout 2020

But if you ignore that advice and choose to play in such a game, the even money bet suddenly makes sense.

Here’s why. You still have the 30% probability that the casino will have a blackjack. So, now, you’re looking at winning $120 approximately 70 times out of 100, or $8400.

But if you take even money, you’ll win $100 every time for $10,000 in winnings. In a 6:5 blackjack game, even money is a GREAT bet.

The problem is that it doesn’t come up often enough to make up for what it does to the house edge. A good blackjack game might have a house edge of around 0.4% if you play with perfect basic strategy.

Convert that to 1.8%, which is what the 6:5 payout does and, suddenly, that great game becomes pretty mediocre. And that 1.8% accounts for the even money proposition, too.

Conclusion

The basic blackjack strategy should inform your every decision in blackjack, but the correct basic strategy varies based on the rules in place.

The differences between insurance and even money and when it’s appropriate to place such a bet are great examples of this.

When To Take Insurance Blackjack

Do you ever take even money when it’s available at the casino? If so, do you think this post might have changed your mind about that?

Insurance Blackjack Payout Rules

Let me know what you think in the comments.