A system and method for providing a gambling loss insurance policy
automatically computes insurance premiums and processes gambling
sessions covered by the gambling loss insurance policies. The players
may purchase the insurance policies using various means such as
coins, earned winnings, or credit cards. The gambling loss insurance
system provides a high level of flexibility for the players to define
specific parameters of the insurance policy. Additionally, the players
may purchase the insurance policies directly from the gaming machine,
a custom terminal on casino floor, or cage personnel having access
to a centralized network server.
What is claimed is:
1. A gaming system for providing a user of the system with a gambling
insurance policy to provide protection against gambling losses,
the gaming system comprising: a game terminal including; processing
means for executing a game, user input means for receiving a user
ID and policy requirements for the gambling insurance policy, and
a display for displaying game results and information relating to
the gambling insurance policy; and a game server, connected to the
game terminal, including means for receiving the policy requirements
from the game terminal, means for determining a premium cost based
on the policy requirements, and means for transmitting information
concerning the premium cost to the user.
2. The system of claim 1, wherein the user input means includes:
means for receiving from the user a confirmation to purchase the
gambling insurance policy.
3. The system of claim 1, wherein the user input means includes:
means for receiving an amount of coverage as one of the policy requirements.
4. The system of claim 1, wherein the user input means includes
means for receiving a period of coverage as one of the policy requirements.
5. The system of claim 1, wherein the gambling insurance policy
contains a period of coverage, and wherein the game server further
includes means for determining whether the period of coverage has
6. The system of claim 5, wherein the game server further includes
means for updating an expiration status of the gambling insurance
policy having an expired coverage period.
7. The system of claim 1, wherein the game terminal further includes:
payment means for receiving the premium cost from the user.
8. The system of claim 1, wherein the game terminal further includes:
means for receiving a credit card number, and means for transmitting
the credit card number to the game server.
9. The system of claim 1, wherein the game server further includes:
means for storing user ID and corresponding user information; and
means for authenticating the identity of the player by determining
whether the storing means contains the user ID.
10. The system of claim 1, wherein the processing means includes
means for generating a random number, and means for executing the
game based on the random number.
11. The system of claim 1, wherein the game terminal is a slot
12. The system of claim 1, wherein the game terminal is a video
13. The system of claim 1, wherein the game terminal is a keno
14. The system of claim 1, in which the game terminal further includes:
means for receiving information that is associated with the game.
15. The system of claim 1, in which the game terminal further includes:
means for displaying information that is associated with the game.
16. The system of claim 1, in which the game terminal further includes:
means for determining a game result.
17. The system of claim 1, in which the game terminal further includes:
means for transmitting a game result.
18. The system of claim 1, in which the game terminal further includes:
means for transmitting the user ID.
19. The system of claim 1, in which the game server further includes:
means for determining a game result.
20. The system of claim 19, in which the means for determining
the game result comprises: means for receiving the game result.
21. The system of claim 19, in which the game server further includes:
means for determining an insurance adjustment based on the game
22. The system of claim 1, in which the game server further includes:
means for receiving the user ID.
23. The system of claim 1, in which the game server further includes:
a database that includes an indication of the gambling insurance
BACKGROUND OF THE INVENTION
The present invention relates generally to gambling systems, and
more particularly to a system and method for generating and executing
insurance policies for gambling losses.
Gambling at casinos has long been a popular activity. Casinos offer
a wide variety of games such as slot machines and table games. Some
of the more common slot machines include standard reel machines,
video poker, and keno machines. A conventional slot machine operates
when a player inserts one or more coins, bills, or tokens into a
coin acceptor and plays the game by pulling a handle or pushing
a button. In many instances, the slot machines are connected to
a network with a centralized tracking system.
Regardless of the particular type of game, gambling generally exposes
the players to unpredictable gambling losses. Once a player starts
gambling, it is sometimes hard for the player to keep accurate track
of the amount of gambling losses, and even players that can do so
sometimes find it hard to control the urge to continue playing.
Thus, gambling may result in a substantial financial loss to the
It is known in the art to provide insurance policies against certain
types of gambling losses. One system for providing such gambling
loss insurance is described in U.S. Pat. No. 5,178,390 (Okada).
This patent describes a slot machine that offers insurance by having
the player insert coins into a coin acceptor dedicated to insurance
payments. Thereafter, the slot machine provides a payout to the
player depending on whether the machine has paid any jackpots over
a given number of handle pulls. The payout, however, is not directly
related to the amount of gambling losses, and the insurance protection
applies only to a particular machine from which the insurance was
purchased. Therefore, the player not only has limited flexibility
in defining the policy requirements, the player must play at a particular
machine during the entire insurance coverage period.
Another patent, U.S. Pat. No. 4,669,731 (Clarke), teaches a slot
machine that pays out to the player when a predetermined number
of consecutive games are lost. Similar to the Okada patent, however,
the protection is not transferable between various slot machines,
and the player cannot define the requirements of the protection,
such as amount of losses.
Accordingly, not only are these systems restrictive in defining
the type and scope of the insurance protection, they do not offer
avenues for individuals to play different types of games at different
locations under a single insurance coverage. Instead, the players
must purchase the insurance at the particular machine at which they
will play throughout the entire insurance coverage period. Additionally,
once the player initiates the insurance period, the player does
not have an option to suspend the gambling session. Thus, these
systems not only provide limited protection against gambling losses,
they also significantly limit the games that may be played while
covered by an insurance policy.
Therefore, it is desirable to provide protection against unpredictable
gambling losses with flexible insurance policies.
It is also desirable to offer insurance protection enabling players
the freedom to move between slot machines while maintaining a high
level of playing enjoyment.
It is further desirable to provide a method of procuring gambling
loss insurance through commonly accessible means such as credit
SUMMARY OF THE INVENTION
Systems and methods consistent with the present invention automatically
determine appropriate premiums for gambling insurance policies,
and provide convenient distribution and administration of those
Specifically, a system for providing a gambling loss insurance
policy consistent with this invention comprises a game terminal
and a game server. The game terminal includes processing means,
user input means, and a display. The processing means executes a
game. The user input means receives a user ID, game information,
and policy requirements for the gambling insurance policy. The display
displays game results and information relating to the gambling insurance
policy. Moreover, the game server includes a receiving means, a
determining means, and a transmitting means. The receiving means
receives the policy requirements from the game terminal and the
determining means determines a premium cost based on the policy
requirements. Finally, the transmitting means transmits the premium
cost to the user.
A method for providing a gambling loss insurance policy consistent
with this invention comprises several steps. Initially, a game terminal
receives a user ID and policy requirements for the gambling insurance
policy from the user. The game terminal transmits the user ID and
the policy requirements to a game server, which then determines
a premium cost based on the policy requirements. Finally, the game
server transmits the cost of the premium to the user at the game
BRIEF DESCRIPTION OF THE DRAWINGS
The accompanying drawings, which are incorporated in and constitute
a part of this specification, illustrate the invention, and together
with the description serve to explain the principles of the invention.
FIG. 1 is a block diagram of a gaming system consistent with the
FIG. 2 is a detailed block diagram of the network server in FIG.
FIG. 3 is a table illustrating the data structure of a player database
in the data storage device of FIG. 2;
FIG. 4 is a table illustrating the data structure of an insurance
database in the data storage device of FIG. 2;
FIG. 5 is a detailed block diagram of the slot machine in FIG.
FIG. 6 is a flowchart illustrating a preferred process for selecting
FIG. 7 is a flowchart illustrating a preferred process for calculating
an insurance premium;
FIG. 8 is a flowchart illustrating a preferred process for finalizing
the purchase of the insurance policy;
FIG. 9 is a flowchart illustrating a preferred process for system
maintenance of active insurance policies;
Fig. 10 is a flowchart illustrating a preferred process for processing
a gambling session covered under the insurance policy; FIG. 11 is
a flowchart illustrating a preferred process for determining whether
an insurance adjustment is necessary pursuant to the results of
the gambling session of FIG. 10;
FIG. 12 is a flowchart illustrating a preferred process for transmitting
a payout to the player;
FIG. 13A is a block diagram of a gaming system consistent with
the present invention; and
FIG. 13B is a block diagram of a gaming system consistent with
the present invention.
Reference will now be made in detail to preferred embodiments consistent
with the invention, examples of which are illustrated in the accompanying
FIG. 1 shows a gaming system consistent with the present invention
having a network server 200 and a slot machine 500. Slot machine
500 is only one example of a gaming machine, and one skilled in
the art may easily substitute slot machine 500 with other types
of gaming machines. Network server 200 is preferably a conventional
server computer and slot machine 500 is a conventional slot machine.
Although FIG. 1 shows only one slot machine 500 connected to network
server 200, several slot machines 500 and/or other gaming machines
may connect to network server 200.
In operation, slot machine 500 transmits to network server 200
information such as player ID number, policy requirements, insurance
premiums, and gambling results. Network server 200 transmits to
slot machine 500 information such as insurance premium and payout
FIG. 2 shows a detailed block diagram of network server 200. Network
server 200 preferably includes a central processing unit (CPU) 205,
a communication port 210, a random access memory (RAM) 215, a read-only
memory (ROM) 220, a clock 225, and a data storage device 240. All
of these later elements are connected to CPU 205 to facilitate the
operation of server 200.
In the example shown, network server 200 receives and transmits
information using an interface 230. Server 200 may be configured
in many different ways. For example, network server 200 may be a
conventional server computer such as an RS 6000 manufactured by
IBM Corporation. Alternatively, the function of server 200 may be
distributed across multiple computing systems as described below.
Data storage device 240 may include a hard magnetic disk drive,
optical storage units, CD-ROM drives, or flash memory. Data storage
device 240 contains databases used in processing transactions in
accordance with the present invention, including a player database
245 and an insurance database 250. In one embodiment, database software
such as ORACLE7, manufactured by ORACLE CORPORATION, creates and
manages these databases. Insurance premium calculation algorithms
(not shown) are preferably stored in storage device 240 and executed
by CPU 205.
FIG. 3 shows an example of the organization of player database
245, which maintains data about the players. Database 245 includes
multiple records 245a-c, each record including fields specific to
a player, such as name, player ID, address, credit card number,
credit card expiration date, earned payout, preferred payment method,
and insurance policy tracking number.
FIG. 4 shows an example of the organization of insurance database
250, which maintains data on insurance policies generated by the
players. Database 250 includes multiple records 250a-c, each record
including fields specific to a player such as player ID, policy
tracking number, coverage type, premium amount, loss threshold,
coverage period, coverage amount, status, and gambling session results.
Interface 230 connects network server 200 to a network of slot
machines 500 and/or other gaming machines. Interface 230 also connects
to communications port 210.
Network server 200 may also be configured in a distributed architecture,
wherein databases and processors are housed in separate units or
locations. Some such servers perform primary processing functions
and contain at a minimum, a RAM, a ROM, and a general processor.
In such an embodiment, each of these servers is attached to a wide-area
network (WAN) hub that serves as a primary communication link with
the other servers and gaming machines. The WAN hub may have minimal
processing capability itself, serving primarily as a communications
FIG. 5 shows a detailed block diagram of slot machine 500. Interface
230 connects slot machine 500 to network server 200. Slot machine
500 includes a CPU 505 connected to a RAM 510, a video display area
515, a ROM 520, a reel controller 525, a player card tracking device
530, a random number generator 535, a starting controller 540, interface
585, a data storage device 550, a hopper controller 565, hopper
570, an operating system 575 (typically comprising software stored
in memory), and a clock 580. Data storage device 550 includes a
probability table 555 and a payout table 560.
Slot machine 500 operates in a conventional manner. The player
starts the machine by inserting a coin or using electronic credit,
and initiating starting controller 540. Under control of a program
stored, for example, in data storage device 550 or ROM 520, CPU
505 directs random number generator 535 to generate a random number.
CPU 505 looks up the generated random number in stored probability
table 555 and finds the corresponding outcome. Based on the identified
outcome, CPU 505 locates the appropriate payout in the stored payout
table 560. CPU 505 also directs reel controller 525 to spin reels
526, 527, 528 and to stop them at a point when they display a combination
of symbols corresponding to the selected payout. When the player
wins, the slot machine 500 stores the credit balance in RAM 510,
and displays the balance in video display area 515.
Hopper controller 565 is connected to hopper 570 for dispensing
coins. When the player requests to cash out by pushing a button
on slot machine 500, CPU 505 checks RAM 510 to see whether the player
has any credits and, if so, signals hopper controller 565 to release
an appropriate number of coins into a coin tray (not shown).
In alternative embodiments, slot machine 500 does not include reel
controller 525, and reels 526, 527, 528. Instead, video display
area 515 graphically displays simulated representations of objects
contained in the selected game, such as graphical reels or playing
cards. These representations are preferably animated or displayed
to simulate playing of the selected game.
Player card tracking device 530 includes display 531 and card reader
532. Players insert player tracking cards into card reader 532.
Tracking cards can be plastic cards with magnetic strips electronically
storing respective player ID numbers. Display 531 displays information
concerning the use of player card tracking device 530, and allows
communications to be displayed to the player regarding insurance
policy requirements. Display 531 may be a touch screen display for
receiving signals from the player concerning the selection of the
Alternatively, slot machine 500 or player card tracking device
530 may include one or more separate input buttons (not shown) for
the players to select the policy requirements and provide other
input such as a PIN. Credits earned during play are stored locally
in RAM 510 and displayed in video display area 515. Slot machine
500 or player card tracking device 530 could also include one or
more separate input devices for selecting the policy requirements.
In other embodiments, slot machine 500 recognizes the identity
of players through player identification devices other than player
card tracking device 530, thereby eliminating the need for players
to carry player identification cards. For example, slot machine
500 could include a keypad, at which players enter either their
player identification numbers or their names along with a secured
password. Slot machine 500 could also include a device for measuring
player biometrics (e.g., fingerprint, voice, or retinal detection)
to identify players.
Commercially available player card tracking devices include, for
example, the Mastercom device available from Bally Manufacturing.
(See, for example, U.S. Pat. No. 5,429,361 to Raven et al.). Such
player tracking devices include a magnetic card reader and a numeric
keypad for entry of player information.
In one embodiment of this invention, a player registers in advance,
for example, at a cashier's station, and obtains a tracking card.
The tracking card may be a magnetically coded tracking card generally
used at casinos, a stored value card, or other form of smart card.
In the preferred embodiment, only the player ID number is stored
on the player tracking card for security reasons. However, other
types of information, such as monetary value, can also be stored
on the player tracking card.
During registration, the player provides the various player information
shown in FIG. 3, such as name, address, credit card number, and
credit card expiration date. The casino assigns each player a unique
numeric ID number. The player also provides preferred payment methods
to define the preferred methods of receiving payouts under the policy
which will be described in detail below. Additionally, the system
maintains an indication of whether the player has an insurance policy.
The player registration, as well as the purchase of insurance described
below, may also take place at slot machine 500 or any game machine
having an interactive interface.
FIG. 6 illustrates a process consistent with this invention for
purchasing gambling loss insurance. Initially, the player inserts
the tracking card into slot machine 500 (step 600). Card reader
532 of player card tracking device 530 reads the player ID stored
on the player tracking card, and player card tracking device 530
transmits the player ID to network server 200 (step 610). Network
server 200 looks up the player ID number in player database 245
and checks to see whether the player has an existing insurance policy
(step 620). If the player has an existing policy, the player may
either initiate a gambling session under that policy or purchase
Regardless of whether the player has a policy, display 531 presents
to the player information giving the player an option to purchase
a new or additional gambling loss insurance, at which point the
player may elect to establish an insurance policy (step 630). Policy
requirements may be established in various ways: entering data directly
into a key pad attached to slot machine 500; entering data into
a custom terminal on a casino floor; providing data to a cashier
who enters the requirements directly into network server 200; or
entering the data using a telephone, which then transmits the data
to network server 200. For this embodiment, it will be assumed the
insurance policy is purchased from slot machine 500.
Next, the player defines the type of coverage by establishing policy
requirements of the insurance policy (step 640). The player determines
the loss at which the insurance policy pays a claim, the amount
of each bet, and the time period over which the insurance policy
is in effect.
There are a number of ways in which the amount of coverage can
be described (step 650). For example, an insurance policy with a
stated loss limit of five hundred dollars provides a payment to
the player if his losses for the covered gambling session exceed
five hundred dollars. The payment could be made if losses exceed
five hundred dollars at any time throughout the session, or only
if losses exceed five hundred dollars at the conclusion of the covered
gambling session. Alternatively, a graduated insurance payout scale
could allow for insurance payouts to increase as the size of the
loss increases. Rather than specifying an amount of loss, the insurance
policy could instead describe a rate of loss, such as one hundred
dollars per hour. Any insured gambling session in which losses exceeded
one hundred dollars for a given one hour period would result in
an insurance payout. Loss amounts could also represent a fraction
of the amount of money gambled during the insured session. A forty
percent loss limit, for example, would trigger an insurance payout
when losses for the session exceed forty percent of the total amount
bet during the session.
The player next describes the amount of each bet over the insured
period (step 660). A slot machine player, for example, might indicate
that he is playing a dollar machine and that he is playing three
coins per handle pull. The player may also specify the type of slot
machine that he is going to play in order to provide basic information
about the standard deviation of the outcomes to the server.
After establishing an amount of loss to be covered, the player
selects the coverage time of the policy (step 670). For example,
the insurance policy could specify a start and stop time. Any gambling
within this time window is covered by the policy. Alternatively,
the player could select a number of handle pulls so that the insurance
period is based on activity rather than time. For example, the player
may establish a policy to cover the next one thousand handle pulls.
Insurance payouts can take a number of different forms. They can
be a fixed dollar amount, a fraction of all losses above the loss
limit, or a number of free plays on the machine.
Network server 200 stores the player selected coverage type and
the selected loss threshold in insurance database 250. Slot machine
500 then transmits the policy requirements to network server 200
through interface 585.
FIG. 7 is a flowchart illustrating a process for calculating a
premium cost consistent with this invention. First, network server
200 stores the policy requirements received from slot machine 500,
along with the player ID, in insurance database 250 (step 700).
CPU 205 accesses a premium calculation algorithm pre-stored in storage
device 240 (step 710), and computes the premium costs based on the
policy requirements (step 720). Although many different algorithms
may be used to calculate the premium costs, insurance policies having
a high level of protection will generally require higher premiums.
If all else is equal, the premium amount increases as the amount
of the insurance payout increases. An insurance policy which pays
fifty dollars for any loss greater than five hundred dollars over
a one hour period will generally cost twice as much as a policy
which pays twenty five dollars for the same loss profile.
As loss limits increase, the premium amount declines, reflecting
the decreased probability that the player loss will trigger an insurance
Greater gambling activity will of course necessitate relatively
higher insurance premiums. A doubling of the time period of coverage,
for example, will increase the premium amount (although not necessarily
linearly). Higher bet amounts per handle pull will also result in
higher premium amounts. Insurance policies written on machines with
relatively high payout variance will also require higher insurance
Once calculated, network server 200 transmits the premium cost
to slot machine 500 (step 730) which then displays the premium cost
on display 531 (step 740).
FIG. 8 is a flowchart illustrating a process consistent with the
invention for finalizing the purchase of an insurance policy. The
player evaluates the premium cost shown on display 531 and decides
whether the premium is acceptable (step 800). If the premium is
not acceptable to the player (step 810), the player may develop
new policy requirements (step 820). For example, if the premium
is too high, the player may increase the loss amount covered or
shorten the time period covered by the policy. Network server 200
then calculates a new premium based on the modified policy requirements
(step 825), as described in connection with FIG. 7. This new premium
amount is then transmitted to slot machine 500 for display to the
If the premium is acceptable to the player (step 810), the player
transmits an acceptance to network server 200, providing a confirmation
to purchase the specified insurance policy (step 830). Network server
200 stores the premium amount in the premium amount field of insurance
database 250. Next, network server 200 generates a tracking number
and appends it to the insurance policy record as shown in FIG. 4
(step 840). Network server 200 receives the premium from the player
by directly debiting the player's credit card account, accepting
coins deposited by the player, or debiting the player's winnings
accrued at slot machine 500 (step 850). Once sufficient payment
is received for the premium, network server 200 stores the insurance
policy record in insurance database 250 (step 855). At this point,
network server 200 sets the status field of the insurance policy
in insurance database 250 to "active" and adds the insurance
policy tracking number to player database 245. Network server 200
also issues a policy tracking number and stores it in insurance
Network server 200 also performs maintenance checks to ensure that
only active insurance policies are stored in insurance database
250. FIG. 9 is a flowchart illustrating a preferred process for
maintaining active insurance policies. First, network server 200
makes periodic searches through insurance database 250, retrieving
the coverage period of each insurance policy (step 900). CPU 205
checks whether the insurance has expired by comparing the coverage
period with the current data and time (step 910). If the current
date and time are beyond the coverage period, network server 200
changes the status field of the insurance policy from "active"
to "expired" in insurance database 250 (step 920). If
the current data and time are not beyond the coverage period, the
insurance policy maintenance is complete (step 930). For insurance
policies with a period of coverage defined by number of handle pulls,
CPU 205 checks to see whether the number of outcomes received exceeds
the defined period of coverage.
Once an "active" insurance policy is stored in insurance
database 250, the player may conduct an insured gambling session
under the insurance policy as shown in FIG. 10. To begin an insured
gambling session, the player inserts the player tracking card into
player card tracking device 530 of slot machine 500 (step 1000).
Slot machine 500 then transmits the player ID number stored on the
player tracking card to network server 200 (step 1010). If network
server 200 determines that the player has an active insurance policy
in insurance database 250, CPU 205 of network server 200 starts
storing the player's gaming results in the results field of insurance
data base 250.
During a gaming session at slot machine 500, the player may choose
to take a break and temporarily suspend the session without decreasing
the coverage period. Additionally, the player is free to relocate
to another machine or play a different game. To do so, the player
simply selects a "suspend" option, at which point slot
machine 500 transmits the current session record to network server
200. Thereafter, a new session record is initiated at another gaming
machine. Regardless of the gaming machine, slot machine 500 transmits
the tracked session record to network server 200 for processing
at the end of each gaming session (step 1020).
When network server 200 receives the session record from slot machine
500, it processes the data under the insurance policy. FIG. 11 is
a flowchart illustrating a preferred process for determining whether
an insurance adjustment is necessary. First, network server 200
searches insurance database 250 for the player ID (step 100). If
the player ID number is not found in insurance database 250 (step
1110), no insurance adjustment is necessary because the player does
not have an active policy (step 1120).
If the player ID is found in insurance database 250, network server
200 accesses insurance database 250 to see whether the insurance
policy is currently active (step 1130). If the insurance policy
is not currently active, no insurance adjustment is necessary, and
the player is appropriately notified (step 1140). If the insurance
policy is "active," however, and if these gambling results
conclude the coverage period specified in the insurance policy,
an insurance adjustment, or payout, is necessary (step 1150). Additionally,
the result field in insurance database 250 is updated with the current
slot machine session result (step 1160).
FIG. 12 is a flowchart illustrating a preferred process for transmitting
an insurance payout to the player. To make a payout, network server
200 first analyzes the results stored in the gambling session results
field of insurance database 250 (step 1200). If the loss does not
exceed the loss threshold stored in insurance database 250, no insurance
adjustment is necessary. If the loss meets or exceeds the specified
threshold, CPU 205 of network server 200 calculates an appropriate
insurance payout amount due the player according to the insurance
policy requirements (step 1210). Once the insurance payout amount
is calculated, the payout is made according to the method specified
in the complimentary information field of player database 245.
In the preferred embodiment, network server 200 updates the earned
payout field of player database 245 (step 1220). Thereafter, the
player may collect the insurance payout at any time at a cashier's
station (step 1230). Paying the player at a location away from a
gaming machine or table game helps discourage players from immediately
spending the payout and may be a preferred option amongst the players.
Alternatively, the player may choose to transfer the payout directly
to his credit card. In that case, network server 200 directly credits
the player's credit card by the amount of the payout. Additionally,
the player may choose to transmit the payout directly to slot machine
500, in which case the compensation is disbursed through the payout
tray of slot machine 500. Regardless of the payout method, network
server 200 updates insurance database 250 to reflect that a payment
has been made.