This week I came across this model in a very old slide deck:

I was quite impressed with my past self for coming up with this. Nice work somewhat younger Pete.

I think this is a really good way to think about risk. Here’s what I do:

Some things have a high financial impact but we can’t insure them (eg. divorce). These things we need to avoid or mitigate. Prioritise looking after yourself and your marriage etc.
Some things have a high financial impact and are insurable (eg. death). Insure those things (until you don’t need to because you have enough money or assets to cover their loss).
Don’t insure things that have a low financial impact, whether you can or not. Don’t extend the warranty.

Of course, I don’t know your circumstances, and as Seth Godin would say, milage may vary.