I don't think many people want to buy insurance whose maximum possible payout comes down to a couple of hundred bucks. People generally only insure against risks which they can't afford.
Except for health insurance, where people insure against the risk that they're going to go to the doctor for a routine annual checkup this year. (Other people have said it better than me: its like submitting a claim against your car insurance to pay for an oil change.)
AAA seems to be doing pretty well, and I can't think of too many people who drive a car, could afford the $39-59 for AAA, but not the <$100 to get towed 3 miles or <$350 to get towed 100 miles.
I've been a member for 17+ years, and the convenience way outweighs the price.