I stopped paying for phone insurance a few years ago, as I found when I actually needed to make a claim, due to the phone dying of its own accord, they were less than helpful and I pretty much ended up having to pay for a brand new phone.
Also, it seems like they have just skyrocketed the insurance. My first contract in 2000 was £2 insurance, then it was £4, then £6 when I last had it last. The next contact I took out they were wanting £8, due to it being an 'expensive phone' (though my last one was supposed to be expensive, and was actually more expensive than my new one you replaced it with!). Now they are wanting £12 to cover an iPhone! The cheek.