By exaggerated you mean didn't happen or won't happen to me?
I think, like many people, you try something, find it works and then think that'll be ok then for the future.
This is why government has made car insurance, MOTs, seatbelts, etc... compulsory, because otherwise people wouldn't bother.
I think the government should make use of an extension lead illegal with a granny, mandate a dedicated circuit (illegal to use ring main) and an electrical inspection/certificate. Then if ignored and catastrophe strikes, it should invalidate the home insurance.