I never buy extended warranties and every consumer advocate I know of, similarly warns people they are a rip off, especially with consumer electronics. There are plenty of explanations for this online so Google if you are really interested.
Also almost all AMEX cards come with a warranty extension feature at no additional cost. Right now, when you buy w/ most AMEX cards your warranty is automatically doubled, up to two years. I've used this service on a computer before. It works.
Select Visa/MC cards (mostly Platinum and above) also have this same feature, though some require you to register your product with them when you purchase it. Check with your card issuer for details.
Accidental damage is only covered for the first 90 days on the AMEX, not sure about Visa/MC but still, you'd have to be pretty negligent to damage a Kindle. They are extremely durable.
Bottomline, spending 18% additional on the small odds you will damage your Kindle or it will go haywire doesn't seem all that prudent. It's like buying insurance when the dealer shows an ace. Everyone "in the know" knows that is a sucker bet except the sucker who bought it.