If you can mitigate your business risk, and the price of that mitigation has a positive NPV given your cost of capital, you generally take it. I’ve therefore always been a believer in insurance. I consider it (in several forms) an important part of my personal portfolio. And I have been involved with several software businesses which processed potentially high-risk transaction – I always insisted the companies have some errors and omissions coverage.
With respect to open source software, I believe it is a ball that has barely gotten rolling yet. Big players are getting into the act, and that is going to bring a lot of otherwise indifferent folks in to take a look.
In summary, I appreciate insurance as a cost beneficial hedge and I adore the open source movement, so I am obviously going to think that open source software insurance is an idea whose time has come. It’s good for the users of open source, and it is a heck of a credibility enhancer for the open source community as well.