You may not see it coming for one reason or another depending on general life risk exposure.
While this is technically true, MMM has done a number of articles that relate to whether we should be really trying to concern ourselves with every possible risk outcome. The safety margin one seems especially relevant. If you have a pretty large safety margin built up as is, and you realize that there are abundant ways to generate at least some income if you come across a hardship, you probably arent as exposed to having your home taken in a bankruptcy as you think. My safety margin currently consists of: cash on hand, taxable investments, $1MM umbrella insurance, auto liability insurance with medical payments coverage, homeowners insurance, etc. I would have to kill 2 people in a car accident and have them come full force against me (to use your example) to have any chance of exceeding this safety margin.
I'm in the middle camp. I pay extra on my mortgage and also contribute to an investment account every month on top of 401k and Roth contributions. I like spreading it out so that each part of my portfolio benefits.
But to answer your original question, I think it does make sense for a risk-averse investor to pay down the mortgage and get a guaranteed return (with the exception of possible bankruptcy). But I wouldnt advise them to stop contributing to retirement instruments to pay off the mortgage early.
It was said well in another place (possibly on today's Mr Toque blog post comment section). Life is not lived only according to spreadsheets. There is a tangible value (varies by person) associated with feeling free from a mortgage and outright owning your own property.