The primary purpose of the AMA insurance is to protect the HOBBY, not you or me. Many of us fly on public land, and it's almost certain that in most cases, the government entity would not permit the activity if the insurance didn't exist. So, even for those of us with our own liability and medical insurance, it's still a good deal.
As to the 2 million, vs 1 million, or whatever, it's true that many severe injury cases are settled for the policy limit, since juries prefer to take money from faceless corporations rather than making a neighbor totally destitute. However, that doesn't mean it makes sense to under-insure yourself. If you don't have insurance, the wronged party will go after your assets. I believe the AMA assets are a lot more than 2 million (I could be wrong).
Take a look at
http://www.kkrlaw.com/changes/safety_standards.htm .
This $6.6 million settlement was against an organization that had absolutely nothing to do with the case (they write standards for swimming pools). Last I heard, they declared bankruptcy.