Blackjack Strategy: Insurance

If the dealer’s upcard is an ace, he or she will offer you insurance. The strategy for whether you should take insurance is simple: never take insurance under any circumstances.

There is a simple mathematical reason why you should always refuse insurance. You’ll win your insurance bet only if the dealer has a 10 in the hole, in which case you’ll be paid 2:1. To break even on this bet, 1/3 of all the cards in the deck would have to be tens. In other words, in order to break even when taking insurance, you’d have to be confident that one out of every three times you accepted insurance you would win your insurance bet. For instance, if you took insurance 6 times and bet $5 each time, you would have to win insurance twice (winning $10 each time) in order to offset the $5 loss you would face the other four times.

In reality, however, the odds are worse than 1 in 3 that you’ll win your insurance bet at any given time: only 4/13 of the cards in a deck are 10s, and 4/13 is smaller than 1/3. For that reason, taking insurance is always a bad idea.

Some blackjack players find the option of taking insurance particularly hard to pass up when they themselves have blackjacks. These players figure that by taking insurance, they’re guaranteed to make money:

Since the odds of the dealer getting blackjack are fairly low, over the long term you’re better off not taking the insurance. Once in a while the dealer may get a blackjack and you’ll push, but more often you’ll win and get a 3:2 payout.