As far as I know, Coinbase has no insurance for their users' coins. If they go bankrupt, you'll lose all your money.

Coinbase is a startup. Failure is the norm, not the exception. Until they get insurance, you shouldn't store more than you're comfortable losing.

Since most consumers can't afford to lose very much, and since most consumers aren't comfortable using an offline storage solution like Armory, they'll need to stick with cash or credit to stay safe. This harms bitcoin adoption among consumers, because they don't have bitcoin on hand with which to buy things on a whim.