Can someone explain insurance for me?

[Captn_All_In]

Okay so I watch HSP and listen to Phil Helmuth and Eli Elezra talking about insurance after Phil and Sam Farha are both all in pre-flop. Phil has AhQh, and Sam has AQo. Phil wants isurance for 10K (I think). They end up not making the insurance deal and run the hand. Phil wins.

Am I am correct in understanding that if Farha wins the pot Eli will pay Phil, and if Phil wins the pot Phil pays Eli 10K?

Okay so if that thinking is correct how much does Phil win from Eli?

Some other basic questions:

When is asking for insurance a good idea?

When is it not a good idea?

How do I translate this into my home game?? Typically .05¢/.10¢ NL, or maybe .25¢/.50¢ NL.

Let me say upfront that I seriously appreciate any and all advice on this subject!!!

[Vince]

For the case they had made the deal.


First, Hellmuth wins nothing from Eli, well, unless he losses.
Phil payed Eli 10K for Eli takes the loss if Phil would have lost.
So Hellmuth payed 10k to insure his 80k (I think that was what Sammy had).
So the math:

let's say he payed 10k insurance the he had 100k at risk.
Let's say Hellmuth is a 8:1 favorite, means he looses every9th hand.
so he wins 800k and looses 100k. Nothing new.
But the insurance is 10k for 100k, so it is 9:1.
that means he pay 8 times 10k insurance (for the times he wins the all-in) that makes costs of 80k, but he saves loses of 100k (for the one time he looses the ll-in).

Or something like that, I can't explain it any better

Insurance is a good deal, if the odds of the insurance are better than the pot odds.

[Captn_All_In]

Okay I think I am following you.

So if I go all in with another player, I could get insurance from a third player to cover my loss instead of taking the loss from my stack, but if I win I pay that third player an agreed upon amount.

[ipgyst]

Originally Posted by Captn_All_In

Okay I think I am following you.

So if I go all in with another player, I could get insurance from a third player to cover my loss instead of taking the loss from my stack, but if I win I pay that third player an agreed upon amount.

Yup. You also have to be the favorite in the hand to get insurance. If you are the underdog there is no point.

[Captn_All_In]

Okay, so I got the idea. Now, in order to make this work in one of my games do you think it would be good to have some basic percentages on paper so that when I make this offer people won't look at me like I am complete flaming idiot....even though I am a complete flaming idiot I at least need to make it look like I am not!!

Any suggestions??

[Diablo_Rojos]

Seems to me like insurance is a sucker bet.

[ipgyst]

Originally Posted by Diablo_Rojos

Seems to me like insurance is a sucker bet.

Give insurance. Never take insurance. And make sure you know the math when you are giving insurance to ensure your long-term profitability.

[Diablo_Rojos]

Originally Posted by ipgyst

Give insurance. Never take insurance. And make sure you know the math when you are giving insurance to ensure your long-term profitability.

Well yeah. Just like in the real world.

[ipgyst]

Originally Posted by Diablo_Rojos

Well yeah. Just like in the real world.

Exactly!

[Captn_All_In]

So basically whenever I see the opportunity I want to offer it up for someone else (meaning I will cover someone) but I don't want to ask someone else when I am the one who is all in??