JUMP Upgrade after phone is paid off

I'll be buying a new phone in a few days. I usually buy the insurance, so on the surface it would be a no-brainer to pay the JUMP fee. But I have a couple questions:

1. Let's say I really like the phone and no compelling upgrade phones are released before I pay the phone off. After I've paid that phone off, a great new phone is released. Do I have to trade in my old phone (completely paid for) in order to get the new phone? Or can I keep the old phone to pass on to my daughter?

2. Is it correct that the only way to get handset protection is to sign up for the JUMP program?

Thanks!