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In Blackjack, if the dealer's initial draw reveals an Ace, players are allowed to "insure" against a dealer having a natural blackjack.

If the dealer turns out to have a natural blackjack, the player collects a 2:1 payout on the insurance - so that you don't wind up losing your bet!

Here's the specific scenario I'd like to understand: Imagine that you're a blackjack player who has $1,000 in chips:

  1. You bet $200 (so you have $800 left).
  2. Cards are dealt, dealer shows an Ace.
  3. You buy insurance (cost: $200; you now have $600 in-hand).
  4. You hit, and your hand busts: you've gone over 21.
  5. Dealer reveals their hand, it's a natural blackjack.

Which of the following outcomes would apply?

  • Outcome A: You don't collect your insurance, because you busted. You have $600 in-hand.
  • Outcome B: You collect insurance, even though they busted. You now have $1,000 in-hand.
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  • 1
    Your proposed steps are out of order; 5 would happen before 4. The dealer checks for blackjack (and reveals if they have it) after insurance bets but before the players act on their hands.
    – Esoteric Screen Name
    May 20, 2016 at 16:39
  • Your comment makes no sense for games where the dealer only receives faceup at the initial deal and then draws after players have acted. You can't have a blackjack (and pay insurance) with just an ace.
    – Nij
    Mar 9, 2018 at 21:40

1 Answer 1

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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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  • If the dealer did not have a natural 21 then you would lose your $100 insurance?
    – John Odom
    Oct 9, 2015 at 16:28
  • @JohnOdom Yes. You would lose the $100 and then play out the hand as normal.
    – Jadasc
    Oct 9, 2015 at 16:42

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