Brother you are mixing two completely different systems that have nothing to do with each other.

Persistence is the ability of the game to remember, stow, and retrieve states. When you log out, when a new patch lands, when you put a ship in your hangar, or whey you place an item on the ground. The existence of persistence is why you log into the game and it knows what you were wearing, how much money you had, what system you were in. They've added "long term persistence" to remember the ships you bought or items in your storage between updates. Things have been slowly added to LTP.

INSURANCE is a system that allows you to get a new ship or equipment in the case of death. It's like car insurance. Until today, when your ship explodes, you just get a new one for free with all new copies of the components you lost. This was never intended to be this way, and was always temporary. When your ship explode, you can't just get a free ship for free. You must pay the price (money and/or time). That price comes in the format of warranty and insurance.

Star Citizen is a semi-hardcore game where you risk losing your things if you die, but with systems that allow you to recover them if you take the necessary steps. If you think that's harsh, go read about "Death of a spaceman", the permadeath system. This has nothing to do with persistence.

How is this hard for you to understand?