Trip cancellation will only cover non-refundable cost. The insurance is not going to reimburse you for funds you are able to recoup from the vendor directly (no double-dipping for reimbursement). So if you cancel 74 days prior to the cruise (with PIF at 75), you can be refunded all but the deposit (20%); closer to the embarkation date, a larger percentage is lost upon cancelling. I suppose you could constantly update your insurance to be just the non-refundable amount, but that would make for several changes.
Trip interruption is different, as it will cover actual expenses incurred due to the interruption. "Interruption" means something that occurs during your scheduled vacation - might be flight delays, injury/illness, etc. - that "interrupts" your vacation plans. Expenses might be hotel, meals, air or ground transportation, etc. It's actual expenses incurred, and has nothing to do with refundable cruise fare. Though by the time you got to the point that your trip was interrupted, the cruise fare would be non-refundable anyway.
Because we purchase our insurance early for pre-existing waiver, we technically don't have any "non-refundable" costs at that point but we do list the full amount of the cruise, then add the airfare later. Ironically, the only non-refundable amount at the time insurance is initially purchased is actually the insurance premium.
Enjoy your cruise!