This would be better served on the T-Mobile section. But as I know, I'll answer.
The insurance and protection plan(they are two separate things) costs about 4.95 if I remember(dont have a bill handy). Its a per month charge that will show up on your monthly bill. And by exchange you mean swapping one vibrant for another in the store? or by mail? My understanding of that is there is no charge for that except for shipping and handling if its done via mail(UPS). And if you don't return the old phone within seven days, they charge you the full price of the phone.
You should be able to add protection and insurance over the phone or in the store and it will just pop up on your bill, unless there is some financial reason for an up front payment(like over due?).