Why Do Online Casinos Offer Insurance?

When casinos talk about insurance, it refers to bets you make to hedge your position.

11:35 22 January 2020

You can bet on both yourself and the casino dealer to mitigate your losses should the dealer win the hand.

There are pros and cons to this method. It can save you money or lose you money, depending on your approach. It's essential to understand how it works, so you use insurance when it's in your favor, not the casino's.

In this article, we’re going to tell you all you need to know about online casino insurance.

But first, we’re going to cover where you legally can play casino on the internet:

 

Where in the world is online gambling legal?

This depends on where in the world you are residing. The gambling laws differ depending on where you live, so there is no one right answer to this query. Most countries today actually have online gambling, even though they have not legalized it, as they have not banned it.

This created a grey zone, where online casinos can offer their services legally.

A few examples of countries and states where people can play casino legally:

USA - In the United States of America there is legal online gambling, but only in some states.

New Jersey and Pennsylvania are 2 states among a few where you can gamble online without breaking the law.

The UK - the United Kingdom have legal gambling since 2015. Everyone can play online without any issues.

Canada - This is one of the gray zones we talked about earlier. In Canada online casinos are not legalized, but they are not banned if they are not within the state borders. This means as long as the casinos are offshore (in countries with generous gambling regulations like Malta, Curacao or Cyprus) they can offer their games legally.

Germany - Germany is a unique case in many ways when it comes to gambling regulation. Like the US, they have different states that are independent in some ways, but in some ways not. This has resulted in some states approving online gambling, and some not, while the state does not recognize any of the licenses issued.

Today, many offshore casinos are offering their service to German players, however they still pay tax to the German state.

This might sound a bit weird, as they do not have a license system in place, but casinos do this so that if the country one day legalize gambling, they will be on their good side, and might have a better chance at scoring a legal license to offer online gambling.

So back to the subject of insurance on online casinos, when and how should you use insurance?

We explain below.

When to Add Insurance

In Blackjack, you would take out insurance on the dealer's hand when you think they might hit a Blackjack, scoring 21 with a ten-value card and an ace. If the dealer’s face-up is an ace, it might be a good idea to place an insurance bet.

Insurance is a side bet that does not affect the main pot. It is designed to minimize your losses when the dealer hits a Blackjack. The stake is half the amount of your initial bet, with odds of 2/1. This means that you break even on the hand, should the dealer hit a Blackjack.

How it Works

It is important to note that placing an insurance bet is time-sensitive. You must bet before the dealer reveals their hole card or when the croupier invites you to do so. At most Blackjack tables, online or in real life, you can wager up to half of what you wagered on your hand. If the card dealer does win, then you will receive a payout for your insurance bet while losing your initial stake. This might seem tempting, but there is only about a 30% chance of winning because that is how often a natural Blackjack happens. It depends on how many favorable cards you think to remain in the card shoe.

Pros

• You don't lose as much money. The biggest advantage of an insurance bet is when the card handler gets a Blackjack, you don't lose, but you have to be smart about when to make the bet.
  
  
• Adds excitement to the game. The thrill of gambling is all about the risk you and others take. Some people believe this is a risky move because of the low chances of winning, but when you do win, others will be just as excited for you.
  
  
• Works well with counting cards. Although frowned upon, if you can count cards, insurance bets usually work in your favor.
  
  

Cons

• You have the potential for significant losses. There is a very low chance of actually winning using this type of bet. It is a risky move, but if done correctly, it can make you a lot more money.
  
  
• High house edge. You will lose your bet 70% of the time. If the card handler does not get a Blackjack and you bet, the money goes back to the house.
  
  

Conclusion: Use insurance sparely when playing casino

Casino games have insurance to make the game more playable, but overall to collect more money. When done right, it is in the player's favor, but done too often, you will lose more money than you win. We recommend only doing this if you are an experienced player who wants to take this risk. If you are new to the game, then stay away from betting insurance until you feel comfortable enough to do so.