I'd go for a simpler solution based on typical insurance in real life. 200K insurance free for everyone. If you want more coverage, you can opt to pay additional premiums. Either a % off all payments made to you in-game until the amount is paid for (If you are low on creds) or a set pre-paid fee to cover your ship type and upgrade replacement cost. Bigger the ship, the steeper the premiums obviously.
Order of insurance payouts should go:
- Ship replacement
- Upgrade replacement
- Bounties
If you run out of insurance money (due to not paying for additional coverage, for example) and cannot afford the replacement ship then Sidewinder and 1K.
Or you get the ship replaced, but you may not have enough for the upgrades.
If you are covered for the ship and upgrades, but cannot pay off the bounty then the balance is on your head when you head out again.
As in real life, the rates should go up with each claim. That can also go down over time as long as there are no other claims.
If my house burns down, I know I'm covered by basic insurance. However, if I have a Picasso in my living room and don't pay to have that covered, then it's gone. A rowboat is affordable to insure. A fifty meter motor yacht is a little pricier.
My $0.02 anyway.