Since this is not always possible with newer sites with not enough players yet, it's a choice of getting some perks from being an early customer or playing safe.
LOL at your username.
Anyway, hacking is always a serious concern. If it happens to large exchanges you can bet the risk is higher for casinos.
If you must play with KYC then make sure to only do so in a "trusted" casino that at least can reimburse any money stolen from you (assuming you are the type to leave money in it).
I am not a fan of gambling that is why this is my first time hearing that a casino would reimburse the money you have in their gambling site just in case a hacking incident will happen, that is some reassuring stuff to have that could attract so many players though I think it is not being implemented by the gambling sites, because if they would be hack, mostly the hacker(s) will steal all of their money, lucky for them if the hackers will not.
That being said, they cannot reimburse the money of all their players because obviously they would be bankrupt and will take time to get their bankroll again.