In my last post I covered what insurance really is. Also discussed was why taking insurance will cost you more money in the long run. However, there is one instance in which it is actually profitable to take insurance.
If you are a card counting player then you are able to distinguish the one instance in which it is good to take insurance.
In order to be in that one instance two circumstances must be in place first:
You must be playing with a remaining deck that is rich in ten value cards. You must also have been dealt a natural blackjack.
Now, let’s examine the two profitable results that can happen once you find yourself in that instance of a high card rich deck and are holding a natural.
For this example, we will say that you are playing at a $10 table. You have been dealt a natural blackjack and the dealer’s up card is an Ace. You have been counting the deck as the game has been played. You know that the deck is rich in ten value cards. Because of the dealer’s Ace you are offered insurance. Because this is that one instance when it is favorable to take insurance, you take it.
The first result is that the dealer’s hole card is a ten value card—he has a natural blackjack too. You will collect on your insurance bet—this is because insurance is really a side bet on whether or not the dealer’s hole card is a ten value, and since it is you win the side bet with a 2-1 payout: $10. As for you both having naturals, that is a push and your original bet is returned to you. But you still made a net gain of $10 all because you took insurance. If you had not taken it, while you would not have lost any money, you would not have gained any either.
The other result is that the dealer does not have a natural, so you lose the insurance bet. But since you have a natural blackjack you won the 3-2 payout. You win $15 minus the $5 insurance bet. Your net gain is still $10.
This is how insurance can in fact be profitable for you.
But you must be dealt a natural blackjack. And you must have been card counting and know that the deck is rich in ten value cards.
If you do not have both of those then do not take insurance.
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