Taking insurance on a good blackjack hand will extend your card counting career.
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Blackjack Insurance

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Card Counting Reality The Blackjack Insurance Bet
    By Arnold Snyder
Card Counting Reality Insure a Good Hand? Part II
    By Peter A. Griffin
The Easiest Professional Level Card Counting System Excerpt from Beat the 6-Deck Game
    How to Use Frequency Distributions to
    Determine Your Win Rate and
    By Arnold Snyder
Best Opportunities Right Now for Blackjack Players The Hi-Lo Lite and Rounding Indices:
    Why All Those Index Numbers Card
    Counters Have Been Learning For
    Years Never Really Mattered
    By Arnold Snyder
How Professional Gamblers Win How True is Your True Count?
    By Arnold Snyder w/ Dr. John Gwynn Jr.
Blackjack Strategy The "Best" Card Counting System
    By Arnold Snyder
Card Counting Reality The "Best" Card Counting System:
    A Comparison of the Red Seven, KO,
    and Hi-Lo Counts (And How Blackjack
    Systems Are Best Compared)
    By Arnold Snyder
    with computer sims by John Auston
Blackjack Strategy Surrender: When It Pays to Say
    By Arnold Snyder
Card Counting Reality Improving Your Insurance Decisions:
    The Victor Insurance Parameter
    By Rich Victor
Blackjack Strategy So You Think You're A Blackjack
    By Arnold Snyder
Card Counting Reality Late Surrender & Blackjack Statistics
    By Arnold Snyder
Blackjack Strategy Bad Player at the Blackjack Table:
    Do Other Players Steal Your Aces?
    By Arnold Snyder

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Blackjack Insurance on Good Hands? Part I

By Marvin L. Masters
(From Blackjack Forum Volume VII #4, December 1987)
© Blackjack Forum 1987

Should you insure a good blackjack hand? Blackjack gurus ridicule this question, replying that insurance is a side bet that has nothing to do with the player's hand. They say if you're counting cards and know that more than one-third of the unseen cards are ten-valued then you insure; if less, you don't.

But what if the tens make up exactly one-third of the unseen cards? That makes the 2 to 1 insurance payoff exactly right, with no advantage to the casino or blackjack player. At first glance it seems that taking insurance in this case is wrong. It's like taking the odds in craps; you increase your bankroll fluctuations without any long run gain.

But wait. Let's look at the statement that the insurance bet has nothing to do with the original bet. This is not true, because correlation is involved, and that is important when making your blackjack insurance decision.

Correlation and the Blackjack Insurance Decision

If you have a natural, the correlation is perfectly negative, -1.0. Whichever bet wins, the other loses. If you do not have a natural but the dealer does, then the negative correlation is also perfect: You lose the original bet and collect on the insurance.

But what if neither you nor the dealer has a natural? Now the correlation between the lost insurance bet and the result of the original bet depends on the quality of your hand. If you have a 20, the correlation will be highly negative: The insurance bet is lost, and the original bet will probably win. With a 16, however, the correlation will be positive: The insurance bet loses, and the original bet will probably lose too.

These correlations lead to some interesting conclusions when there are exactly one-third tens in the deck. If you have a natural, then taking insurance should be automatic. It costs you nothing in the long run, and reduces bankroll fluctuation.

If you have a 20, it seems to me that the decision should be the same. You will probably win the hand if you lose the insurance, so insuring to reduce fluctuation seems like a good idea.

With a 16, however, bankroll fluctuation is increased, not decreased, by the blackjack insurance bet. I speculate that a player hand of 11, 19, or 20 should take the blackjack insurance bet, but other blackjack hands should not. Do any mathematicians out there care to comment? ♠

[Note from Arnold Snyder: Yes, the mathematicians did care to comment. You can see my response and the response of mathematician Peter Griffin by following the links at the top left of this page.]

Recommended Books on Blackjack Insurance and all Aspects of Blackjack

The Big Book of Blackjack by Arnold Snyder contains an entire chapter on the subtleties of the blackjack insurance decision.

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  Taking Insurance on a Good Blackjack Hand is a Good Way to Extend Your Card Counting Career
Perfect insurance play has killed off more card counting careers than any other play in the blackjack card counting arsenal. Insuring good blackjack hands is a low-cost way to improve your lifetime return from card counting.