I’m fortunate to have never had to deal with lost luggage, but I did have my backpack ripped open on a flight and I was grateful to have not had anything valuable in it at the time. I’ve also been on dodgy buses in Southeast Asia where we’ve arrived at our destination and people have had items stolen by someone hiding out in the luggage hold while we were transit.
If there’s anything I’d be upset to lose, I keep it in my daypack, which is always by my side on travel days. For me, that’s my passport, laptop, camera, external hard drive, a debit card, and some spare cash. As long as I have all of these, I can survive indefinitely.