'Rip-off' is too kind. Extended warranties are bullsh*t. If your camera malfunctions through manufacturer's fault, you'll find out well within the year, so you don't need it for that. They'll most certainly will not cover theft, or damage through your own fault (and *everything* eventually is your fault, because you let it etc. etc.). Of course it depends on the exact terms, but as far as I know it is just easy money for the vendor.
Insurance, however, is always a good plan. That won't be much cheaper, but it will cover problems that arise through actual use.