I have a backup regime sorted out. I use Paragon Drive Backup to take images of each of my partitions and Genie Backup Pro to take file backups. The images are on a second internal hard drive, and the file backups are on external USB drives
Well it sounds like you are doing exactly the right thing.
As i understand it you are making images of your operating system partitions, and storing them on an independent hard drive.
so if your main hard drive completely dies, your recovery procedure would look like this:
1) buy a new hard drive of equal or larger size.
2) replace the dead main hard drive with new one.
3) boot up with PARAGON rescue cd (i assume there is such a thing or something related)
4) use that rescue cd or floppy to RESTORE from a partition image to the new hard drive.
5) reboot and you should be back to the last saved image.
(note you could test this out by buying a new hard drive and pretending your main one has died and replace it - it's always useful to do a test run to see if their are any unexpected snags).