It doesn't reduce only magic damage.
Nor does it reduce only physical damage.
It reduces any damage!
In case you feel two minutes is too long, you have some alternatives. Nature's Guardian is an effect that can kick in once every 30 seconds, which might potentially save you (although the next hit you take could be lethal). Stone Bulwark totem is another alternative that places a shield on you which refreshes and adds additional absorb amounts every five seconds after.
The theme of the level 15 shaman talents revolves around survival and damage mitigation. Raiders may lean more toward Astral Shift, but I'm using the Stone Bulwark totem for the purposes of questing and leveling.
It's open warfare between Alliance and Horde in Mists of Pandaria, World of Warcraft's next expansion. Jump into five new levels with new talents and class mechanics, try the new monk class, and create a pandaren character to ally with either Horde or Alliance. Look for expansion basics in our Mists FAQ, or dig into our spring press event coverage for more details!