Applecare is insurance like any other.
On average Apple charges more for Applecare than they have to pay in expenses, pooling the experience of all Applecare owners.
What you get with insurance is peace of mind, that if you are unlucky and the machine breaks down, you won't have exceptional costs. Of course, if it never breaks you have an assured $250 (or whatever) cost.
One thing to remember is if you spill liquid into your machine, drop it, or have it stolen, your investment in Applecare is lost. That is one argument for waiting until the 11th month to purchase and register Applecare - you save that cost if you accidentally damage your own machine in the first year.
Applecare is relatively more valuable to you if:
1) You can't handle diagnosing and repairing a machine on your own (benefit from telephone and service support)
2) You are planning to sell the machine within the three year period (better resale value)
3) You have a notebook Mac (notebooks are more prone to breakdown)
4) You travel with your Mac (AppleCare is good at any Apple store or independent Authorized Apple service provider - note that international coverage is on the portable machines only)
5) You are buying the first release of a new model (Rev 1 machines tend to have more issues, later revs generally are more sorted out)
6) You need to have a predictable repair budget (such as a business that has to budget ahead)
7) Your model of machine has experienced more than average problems in the first year, or you have already had to claim on the warranty on your own machine.
8) You have an Apple brand monitor that you can get covered as well for the same price.
9) You have a top of the line configuration (Applecare is the same price for the type of machine, no matter if its a budget or a premium configuration)
Applecare is less valuable to you if:
1) You plan to modify your machine yourself
2) You don't need phone support
3) You have a history of dropping, losing or damaging your Macs (investigate third party coverage that includes accidental damage)
4) You live in a country with a history of poor Apple service support.
5) You have a desktop machine (desktops on average are more reliable and cheaper and easier to replace components like drives -- however logic boards and CPUs are still expensive)
Also remember that Applecare does not provide for a loaner machine, or for guaranteed fast turnaround, and does not provide for data transfer or recovery.
You absolutely must have a solid backup regimen that you actually run regularly. An external hard drive or Network Storage drive plus TimeMachine, SuperDuper or CarbonCopyCloner make it easy.
Your machine may be in for repair for days or weeks. If you are using your Mac professionally, and it is mission critical, then you must have a backup machine available, ready to go (including the software, fonts, email accounts etc.) This might be a backup machine that you buy, or it may be a rental machine that you know you can access with your backup data and applications.