How Does Blackjack Insurance Work?
If you’re new to blackjack, you might be confused the first time you sit at the table and see “insurance pays 2:1” emblazoned on the felt. For most people, thinking of insurance brings to mind protection for their car or home. Well, insurance in blackjack isn’t a million miles away from that; it’s essentially a payment to mitigate losses. However, this time you’re not protecting against fire or theft but instead against a pair of cards.
What is insurance in blackjack?
In blackjack, you can make an insurance bet if the dealer is likely to have a strong hand – namely, blackjack. You will be offered insurance against the dealer having a natural blackjack if the dealer’s upcard (their one face-up card) is an ace. If their face-down card is a 10 or a face card, they have blackjack and will automatically win the hand without dealing further cards.
Assuming no knowledge of any other cards besides the dealer’s ace, there are 96 cards from the remaining 311 (in a six-deck game) that will give the dealer blackjack. This means they will win automatically almost one-third of the time. Players take insurance to mitigate this risk.
How does blackjack insurance work?
So you’ve got your hole cards. The dealer has an ace. Time to decide if you’re going to take insurance. Insurance is a bet worth half of your main bet and will pay out 2:1. Here’s an example of how it works:
- You bet £20 on a hand of blackjack.
- You receive a 9-6 for a total of 15.
- The dealer’s upcard is an ace.
- You place an insurance bet of £10 in addition to your original £20 bet.
In this instance, if the dealer has blackjack, you will lose your £20 main bet but receive a 2:1 payout on your insurance bet, thereby breaking even. If the dealer does not have blackjack, you will lose your £10 insurance bet but have the chance to play out the hand as normal to try and double your £20 main bet.
The mathematics of blackjack insurance
As we mentioned, there are approximately 96 cards from 311 (six decks, less the dealer’s ace) that will give the dealer blackjack and allow you to break even on the hand. This means that 96/311 times (61.74%) your insurance bet wins. You break even.
Happy days, right? Wrong. There are 215 cards that the dealer could have that do not result in blackjack, thereby losing your insurance bet 215/311 (69.13%) of the time. That results in the insurance bet carrying a house edge of (0.6913 – 0.6174) 7.40%.
In other words, for every £10 you wager on insurance you can expect to lose £0.74 in the long run.
Should you take insurance in blackjack?
If you want to play in the most optimal way to minimise the house edge, then according to the mathematics of blackjack insurance you should never take it. The house edge, by the way, is simply the standardised way of saying: the odds are in the casino’s favour.
The odds of a dealer having blackjack, if their card on display is an ace is roughly 31%, meaning if you played 100 hands having laid out the insurance, you would lose 69 of them.
In addition, whatever way it is framed, it is simply a side bet – an additional bet that stands a chance of losing you more money than you initially laid out; remain focused on the opening bet and hand, and play that game as you had originally planned – an ace being revealed shouldn’t blow that intention out of the water.
That being said, if you are at a live casino and skilled at counting cards to overcome the house edge, there are situations in which insurance may be profitable if you know that there are a lot of tens and face cards in the deck.
If you have given yourself a fixed bankroll for the day’s blackjack session (always a good idea) and want to try to prolong your time at the table, then insurance might be a good idea if you have a poor hand and would rather break even against blackjack than lose.
What is the difference between insurance and even money?
Mathematically, even money is another disguised way of offering you insurance, and therefore another side bet, that is stacked against you, and a quickfire way to lose additional money in one game of blackjack.
Even money, however, only enters the game when you are dealt your two face-up cards, and you hit blackjack (i.e an ace and a picture card or a 10), and the dealer is showing an ace – reminder: insurance becomes an option when just the dealer has revealed an ace in their hand.
This is where the tension builds: the dealer right away offers to double your initial stake right away, without even turning over their second card – also shown as a 1:1 payout.
But this is where you have to consider why would the house offer you this in the first place? And, like all things related to gambling establishments, that is to minimise their losses.
If you rejected the dealer’s even-money offer, and then they revealed a card that didn’t result in them hitting blackjack, then your payout would be 3:2 – or in simpler terms: one-a-half-times more than your initial outlay.
Other blackjack side bets
Although it’s not strictly in the same category, you can think of blackjack insurance as a kind of side bet. After all, you’re wagering money against an outcome – in this case, that the dealer has blackjack.
Most side bets aren’t to be factored into any strategic blackjack approaches, since they all exist due to the fact that they have a high house edge.
Other examples of side bets that might be a little more fun than the nervy wait to see if the dealer turns over a natural blackjack include the following:
Lucky Ladies blackjack side bet
The Lucky Ladies side bet pays out if your first two cards are a pair of tens or higher. The name comes from the huge 200:1 payout you’ll receive for being dealt two queens of hearts.
As always, the sliding scale rewards the likelihood of the occurrence actually happening:
- Unsuited 20 = 4:1
- Suited 20 = 10:1
- Matched 20 (same suit and number/picture) = 25:1
- 2 x Queen of Hearts = 200:1
- 2 x Queen of Hearts and the dealer has blackjack = 1000:1
Super Sevens blackjack side bet
The Super Sevens blackjack side bet will reward you for being dealt any number of sevens. The sevens can be pretty super indeed, with a top payout of 5,000:1 if you receive three suited sevens.
The breakdown of the Super Sevens side bet are as follows:
- 1 x 7 = 3:1
- 2 x unsuited 7s = 50:1
- 2 x suited 7s = 100:1
- 3 x unsuited 7s = 500:1
- 3 x suited 7s = 5000:1
21+3 blackjack side bet
One of the most common blackjack side bets is the 21+3 side bet. This combines blackjack with three-card poker, paying out if your first two cards and the dealer’s up card make a poker hand.
There are various payouts depending on the rarity of the poker hands created:
- A flush, which is five cards from the same suit, returns 5:1
- A straight, which requires five cards to be in numerical order from any suit, gets a 10:1 payout
- Three of a kind, so any suit but the same number/picture, would see a 30:1 return on investment
- Straight flush takes the standard flush to new level by revealing five cards from the same suit that are in numerical order; this lesser-spotted occurrence generates 40:1
- Finally, the suited trips i.e. 3 x four of hearts, sees a payout of 100:1
Perfect Pairs side bet
Plain and simple: you win if the first two cards you’re dealt by the dealer form a pair. This side bet has varying tiers of payout:
- A mixed pair (i.e. the same number but from different suits, of different colours) will result in five times your return on investment (5:1)
- A coloured pair is the same number, from different suits, but either both red or both black; this generates a 10:1 payout
- Finally, a rarely seen perfect pair would require the same number from the same suit i.e 2 x seven of diamonds. If you achieve this, you will see a 30 x growth on your original bet.
Bust It side bet
Before the dealer has revealed any cards for the hand, you place a wager that the dealer will go bust in three cards. Depending on how they go bust will also impact the payout you receive if they do indeed total higher than 21.
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