As a side note, I started this thread to ask a question about Coinbase and those like them, and also to possibly get people thinking about the subject of deposit insurance in general. I never meant this to be a thread about bashing Coinbase, and as others have mentioned, I would be fine putting some of my money in Coinbase, in the same way I get on a commercial airliner even though it's theoretically possible it would crash (although the scenario we are talking about here would be akin to all of American Airline's planes crashing all at once ).

In particular, despite the risks, I would say that putting your Bitcoin in Coinbase is far safer than physically holding your own keys since the risks of that are far greater than storing your keys with Coinbase. Holding your own physical keys for significant amounts of your savings, in fact, is downright dangerous and I wouldn't suggest anybody do it, despite any systemic risks with Coinbase.

(As for other brokers besides Coinbase, that would of course need to be decided on a case-by-case basis).