I have seen so many strategies to combat software piracy by various companies over the years. Nothing even comes close to the - in my opinion deeply flawed - VSL strategy.
But if it's "flawed" that would imply that elicenser has been cracked right? In other words, pirates have broken the codes and are selling them all over the Internet. AFAIK this is not the case. So to me that would be A flawLESS strategy. Now it may cost VSL some customers but it must be only a negligible amount because they are still using the same system.
As far as Insurance is concerned here's my experience:
I too had a hard time finding anybody who would insure the licenses on a little piece of plastic. The problem is they have a hard time trying to determine the risk involved when insuring software licenses contained on a USB dongle. Where is this dongle stored? In a locked box? Is the humidity high there? Will a power surge have any affect on key? etc.
Every company I went to wanted to know the same thing: Are you a professional musician who needs these software products in order to maintain your livelihood? Or are you just a hobbyist?
Oddly enough it was my homeowner's insurance who finally gave me a limited policy. They already gave me small business insurance to cover the gear in my studio so basically the software was just deemed part of my studio gear so I just increased the value of my gear. If the key leaves my studio, I'm screwed. If somebody broke into my studio and stole just the key, leaving the $3,000 system its attached to, I'm screwed. If the key is beyond the warranty period offered by VSL, I'm screwed. Otherwise it's covered.
If you are a hobbyist, you will have a harder time with insurance.