I personally never get insurance for my phones for two reasons:
1) They wouldn't offer the insurance if it was a good deal or they would lose money.
2) The majority of people are never going to break/lose their phone and those that do are probably going to end up paying more in insurance premiums and deductible than the phone is worth.
That said, an $89 deductible isn't a terrible deal since the phone costs about $500 to replace brand new or $200+ for a used one on Ebay.
As to getting a cracked screen fixed, the original question, there are a few options available:
1) If you have the insurance, do that. It's the best option. If you don't have insurance...
2) Buy a used phone on Ebay for about $220. This is the most expensive option but definitely the easiest.
3) Buy the screen on Ebay and replace it yourself. The parts currently run anywhere from $40-$80 depending on where they come from (China or US). As someone who fixes these phones, I can tell you that you should only try this if you're pretty good around electronics. It's one of the tougher repairs I've ever seen to do: Lots of screws, plenty of adhesive, some tricky connectors, and one very fragile ribbon cable. Here's a video of the repair: YouTube video
4) Lastly, you can have a professional repair service repair it for you. In the spirit of full disclosure, I'll tell you that I run a company that does Droid repairs
. However, a quick Google search may reveal some other companies as well. We charge $120 to do the repair and it takes about a week from the time you mail it until you get it back. It's not as cheap as the do-it-yourself option but its a lot safer and definitely cheaper than going the new phone route.