Taking insurance when it pays 3x?

[nighterfighter]

Hey guys,

New member to the board, but been reading here for a long time. Lot's of smart people (and less smart ones on occasion) on here, love checking the new posts when I get home from work.

I was recently playing Blackjack on a free website in a tournament setting against 1 other player, and it was all fake money while they are building the website (won't put it here unless requested/allowed, as I know it seems like spam).

Anyway, the game uses 4 decks, but it uses a CSM (It isn't a live dealer, just computer dealt).

One weird thing I noticed is that insurance pays 3:1 instead of the normal 2:1...

If you aren't counting, taking insurance is -EV, at 2:1 payouts. But at 3:1, isn't it +EV?

Thanks!

[BugsySeagull]

Did you take the insurance bet? Did you get paid 3-1 or 2-1? I wonder if it means 3 FOR 1?

Yes the insurance bet would be +EV, I’m not sure what that does to the EV of the game as a whole. You would want to take insurance every time it’s offered, even if you have a BJ against an ace.

[Freightman]

It is plus EV to take insurance on all hands when payout is 3:1.

Reasoning - assume 100-$100 bets, dealer ace up, taking insurance on all 100 bets at $50, or $5000 insurance cost at risk. You will win 4/13 or 30.7% of hands. At 2:1, Your return is 30.7 x $100 for $3070 plus return of your insurance cost of $1535. Your total return is $4605 against an insurance cost of $5000 for a net loss of $395.

Now, with a 3:1 return, you still have an insurance cost of $1535, however, 3:1 pays $4605, for a total return of $6140.

Nice work if you can get it (provided it's honest)

[nighterfighter]

Thanks, I did take it and it was 3 TO 1, not 3 FOR 1, which made me think it was weird and +EV.

Freightman, that was similar to my thinking as well, just wanted to double check.

It is honest play. The website gets all their revenue through advertising (basically you play a few hands, watch an ad), and the players never put their own money in. It seems like you are always playing with fake money, but if you win the tournaments often enough you get something like $3 to $15, or some paltry amount. Not worth the time, really. They also claim to take any leftover money from the advertisers and donate it to charities, which is cool if true.

Anyways, thanks for confirming what I thought. Wish the real casinos near me would offer that...

[Meistro123]

should be a little more than 20% edge

[lij45o6]

I get:

3(16/52) - (36/52) = (48-36)/52 = 0.230769

or 23% +EV.

[Freightman]

Using my dollar example if 1140 won on 5000 risked equates to 22.8%. That can be fine tuned by calculating or extending 30.7% to more decimal places.

[DSchles]

I get:

3(16/52) - (36/52) = (48-36)/52 = 0.230769

or 23% +EV.

The denominator isn't 52 because you already know that the dealer has an ace, so the edge is about a half percent greater.

Don