I did opt for the replacement insurance on my SPOT, mostly because I was concerned that my elderly father could lose it or drop it in the ocean.
I have a first generation SPOT and after it is able to send a message it stops blinking two lights and just blinks one.  If you watch it a while you can see it send the message...the lights stay on steady for a few seconds instead of blinking.  So far it has been very reliable except that it often cannot send a message if there are trees or brush between it and the open sky.  I have solved this by checking it after a period of time and if it still hasn't sent the message I put it in a different location which usually does the trick.
I used it once to call for HELP.  I returned to Moose Lake a day early and wanted my ride to know I was ready to come home...it concerned my son Dan who was monitoring my signals, until he realized it was coming from the canoe landing and that I probably wanted a ride.  :)