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Neither of your outcomes is correct because your premises are faultyOption B, but not for the reason you think.

You have made two errors:

  1. When you take insurance, you may insure only up to half of your original bet, turning what would ordinarily be a loss into a push at 2:1. In this case, if your wager was $200, you could insure for up to $100.

  2. Once insurance is "closed," the dealer checks to see whether he or she has a natural 21. If he or she does, it is revealed immediately, your insurance is paid out, and all other players lose[*]. If he or she does not, insurance is collected, and the hand proceeds normally. In no case would you still have an insurance payout pending and get to hit.

[*]= Barring those who had naturals themselves, who either took the option for "even money" before insurance had closed, or will now "push" against the dealer's 21.

So, in this case:

  1. You bet $200 ($800 left)
  2. You take insurance of $100 ($700 left)
  3. The dealer shows a natural 21. You lose your $200 bet, but your insurance bet pays out 2 to 1 -- your initial $100, plus $200, for a total of $300 back to you.
  4. You have $1000, same as you had before this hand.

Neither of your outcomes is correct because your premises are faulty.

You have made two errors:

  1. When you take insurance, you may insure only up to half of your original bet, turning what would ordinarily be a loss into a push at 2:1. In this case, if your wager was $200, you could insure for up to $100.

  2. Once insurance is "closed," the dealer checks to see whether he or she has a natural 21. If he or she does, it is revealed immediately, your insurance is paid out, and all other players lose[*]. If he or she does not, insurance is collected, and the hand proceeds normally. In no case would you still have an insurance payout pending and get to hit.

[*]= Barring those who had naturals themselves, who either took the option for "even money" before insurance had closed, or will now "push" against the dealer's 21.

Option B, but not for the reason you think.

You have made two errors:

  1. When you take insurance, you may insure only up to half of your original bet, turning what would ordinarily be a loss into a push at 2:1. In this case, if your wager was $200, you could insure for up to $100.

  2. Once insurance is "closed," the dealer checks to see whether he or she has a natural 21. If he or she does, it is revealed immediately, your insurance is paid out, and all other players lose[*]. If he or she does not, insurance is collected, and the hand proceeds normally. In no case would you still have an insurance payout pending and get to hit.

[*]= Barring those who had naturals themselves, who either took the option for "even money" before insurance had closed, or will now "push" against the dealer's 21.

So, in this case:

  1. You bet $200 ($800 left)
  2. You take insurance of $100 ($700 left)
  3. The dealer shows a natural 21. You lose your $200 bet, but your insurance bet pays out 2 to 1 -- your initial $100, plus $200, for a total of $300 back to you.
  4. You have $1000, same as you had before this hand.
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Neither of your outcomes is correct because your premises are faulty.

You have made two errors:

  1. When you take insurance, you may insure only up to half of your original bet, turning what would ordinarily be a loss into a push at 2:1. In this case, if your wager was $200, you could insure for up to $100.

  2. Once insurance is "closed," the dealer checks to see whether he or she has a natural 21. If he or she does, it is revealed immediately, your insurance is paid out, and all other players lose[*]. If he or she does not, insurance is collected, and the hand proceeds normally. In no case would you still have an insurance payout pending and get to hit.

[*]= Barring those who had naturals themselves, who either took the option for "even money" before insurance had closed, or will now "push" against the dealer's 21.