Absolutely needs to be replaced. Have no idea if your policy will cover. That's for you to inquire. If so don't they usually prorate the tire life?
'08 Carrera S 6MT Guards Red/Black ext leather, Carbon fiber pkg, sport exh, sport chrono +, PASM, Nav, Bose, 19" forged turbos, red tranny tunnel
'07 MV Agusta F4 1000 R 1+1, Corse Red/Silver, RG3 race pipes and factory race ECU