Yes, but it's treated as with every other property. If you invest a million dollars in gold using a third party, even if the gold is stolen, you get your money back in fiat. Currently, if you have 100 BTC in Coinbase, and it gets hacked, you'll not get even 10% of it.

But, I absolutely agree with you. You should self-custody your Bitcoin. If you want to throw a few million dollars in there, at least take some hours to learn how to secure it.