What stopped me from buying flagship phones is the repair costs for phones are far too expensive in relationship to the value of the phone. Results will vary, but waterproofing usually diminishes after a repair.
AppleCare specifically covers water damage of any kind, and is what I would assume OP would be referring to as a "premium warranty and repair service".
ApplecCare is as much a warranty as their Apple's phone are guaranteed waterproof.
It's marketing.
The 3 year warranty add-ons is an insurance. One can get an insurance for any device.
The standard iPhone warranty disclaims water damage [1] and Apple has been sued in the past for using humidity activated sensors.
And if you truly are ultra budget $300 phone guy then sure this doesn't apply to you.