Ok, so it’s not really an insurance policy per se, but the effect is as good as one.
When you buy a music album in its physical form from Amazon, they will also provide you with a digital copy of it on their cloud music service (hence the name AutoRip). With a copy of it on Amazon Cloud Player, you can listen it to from anywhere (streaming through their cloud music service) or download the MP3s for use on digital devices.
What’s greater than this? Even though the service went live as of Jan 10, Amazon is retroactively applying the AutoRip to any eligible albums. So if you have purchased any physical CDs from Amazon lately, chances are that they will be in your profile of Amazon Cloud Player. 
Still wondering how this is like a music insurance policy? Having a physical backup of the music you purchased is great should your digital music be wiped out by computer failure or account lockout. Having it also in the cloud and available for download is extra security in case you have a catastrophic loss and lose both the computer and physical media.
[CNET]
