@2Fast,
In case of theft/total loss, the insurance company first judges the FAIR MARKET value of your vehicle (say you paid 500K for ur car, but now its worth 300K in the market, thats what will be deemed as fair market value). As iiqbal has stated, thats how the depreciation rate works when a brand new car is insured. (been there, done that)
To save on insurance premium, you can install trakker and get a discount, and in case of no claims, you can avail further discount.
Any ways, please ask insurance company of its policy regarding insurance of a 7 year old vehicle. That should be sufficient answer for you to decide whether its worth it or not. best of luck