Will the warrant pay for all the service that will have to be done to your blown up engine? Sounds like I may need to spend that $1300. to have a piece of mind for the next 60000 miles that it covered if it breaks. I will but 20000 miles on a year or more I'm retired know.
The ESP is not like the factory warranty, it is a service contract. As such, you have to read the entire contract and fine print to determine what will or won't be covered, and you won't have the same Federal warranty law protections with the ESP that you have with the factory warranty. The ESP will definitely refuse to pay claims if you tow anything with your bike or even have a hitch installed, they have also been known to refuse to pay claims if you have other than standard parts installed, such as cams. Some people have had ESP pay for major repairs on modified engines, others have been refused. In other words, there are no guarantee's. If I were you I would call the ESP company and ask those kinds of questions up front. And btw, the price you mentioned for the extra three years (5 year plan) is basically MSRP for the standard plan without tire and wheel road hazard coverage. You can do much better, lately a lot of folks have had good luck with Kutter H-D, Jim Palmer, 608-314-1722.
The ESP is just like those service contracts everyone tries to sell you whenever you buy an appliance, TV, car, whatever. In most cases they aren't worth the money for the typical customer. But lately they have saved many a Harley customer some big bucks due to the poor reliability of the bikes. It's a crap shoot as to whether or not you will be a winner or a loser in this, but that is often true when buying what amounts to an insurance product. If a $5k repair bill would put a serious hurt on your budget, spending about $1100 now might be a good idea.

Jerry