I sell cameras at Best Buy, and the plans do as they say --- if you drop your camera, spill something on it, crack your lens (the kit lens), pretty much any non-intentional damage, it's covered. So, you can't run your camera over with your car, or shoot it with a gun.
The plans also cover a one time battery replacement, which on many SLR's is around $80 USD (RETAIL). The criteria for getting another battery is if your battery holds less than 90% of a charge. That seems to happen within the first year.
Furthermore, the plans cover sensor cleanings... 1, 2, or 3 of them; depending on how many years of the plan you get. Also, the "Geeksquad" doesn't do the sensor cleanings. The camera is sent out to the nearest manufacture service center for the cleaning.
So, the plan is definitely more than just damage protection. Also, it REALLY depends on the store/management you're dealing with as far as plan fulfillment goes. My old store replaced a 7D that was having some weird problems where the shutter would just click immediately when it was turned on, and it would do a bunch of stuff seemingly by itself... right on the spot they allowed me to just give the person another 7D. Took 2 minutes and the guy left with a brand new camera. My new store really seems to enjoy sending things out for repair and rarely gives out a new camera right on the spot, especially an SLR.
So, read into what I told you however you want.