It has come up recently in some airliner crashes. When insulation fails, a fire can result. It's a bigger problem in bigger aircraft with miles more wire and higher current loads, but it's important on any aircraft with an electrical system. Aging plastic insulation, chafe, and flex can all lead to a short circuit or just failure of the affected electric equipment. Flight instruments wear, and those with the most movement wear the most.
Gyros are usually the first to go.
Altimeters and airspeed indicators, although two of our most important gauges, seem to last a long time. Engine instruments and fuel gauges also seem to wear well, although their accuracy can degrade significantly. Sadly, there are some old birds that the owners really can't afford. They are headed for the boneyard, and a few will wind up in accidents. It's hard to know when something is merely tired-looking or on the verge of failure.