I believe our phones are covered by Asurion, they're more likely going to try to get you a refurbished phone first. I think T-Mobile charges a $135 processing fee anyway... $7 x 12 months = $84 + $135 = $219. Add taxes ( currently 8.875% for us in NYC, $238.44 total for replacement after ONE year with insurance, $322.44 after two years ), a possible police report, wasted time and annoyance and you might want to opt for dropping the insurance and look forward to purchasing a new NEXUS 4 from Google and investing in a sturdy case and being vigilantly careful with your device.
Think about it.