It's definitely worth having recovery, rather that just roadside assistance. Roadside assistance will at best tow you to a local garage - which if it's late at night or a long way from home isn't much use. When you need to be recovered 200 miles at 3am on a Sunday morning, recovery is very comforting.
A lot of people on another forum I'm on use theAA breakdown insurance scheme. I think there's a £50 excess on any claim, but after that as you say upto £500 is covered (so with the excess you get £450 back). However to claim, you have to break down. It sounds obvious, but it means for instance if you notice a fault gradually developing, you can only claim when it gets bad enough to make the car undriveable. This may cause more damage in the process, and could be rather mechanically unsympathetic. Additionally with this it may be worth having home start, otherwise the car has to be away from the house to claim. (Let's say your alternator fails. You manage to limp the car home rather than wait for recovery in a bad location/time of day. If you had home start, you could claim the alternator light was on when you started the car at a convenient time and wait for them to come out).
My personal experience of recovery companies (don't ask!) is that Britannia are good (for instance if you tell them the car is undriveable and you need a flat bed, they'll believe you rather than insisting on sending a van first to meet their response times), while RAC have kept me waiting a long time (van took an hour, decided he couldn't fix it. Took another 5 hours for a flatbed to appear
)
The other thing they offer, is breakdown repair insurance...so for an extra £69 per year you are covered for parts labour up to £500 should your car breakdown. Has anyone on here got this 
or do you think its good idea 
) as it was significantly cheaper and the cover seemed much better