Unfortunately, eBay doesn't necessarily tell everything to Live Chat representatives (which is why there's a plethora of free websites maintained by "civilians" like the Hobbit eBay Help page), and there are some major holes here. The message boards are filled with people who found that Live Chat was not given enough information to answer all their issues. And I blame eBay for that first and foremost.

Speaking of eBay, the "ploy" you described is similar to the additional insurance PayPal attempts to add onto all sorts of services - making money when they know there are few opportunities for the item not to arrive safely. Likewise, it's the same reason why Best Buy and other companies push those extended warranties.

So first of all. Your statement completely omits the possibility of third-party insurers like UPIC, which many more people also use in tandem with Endicia, the PC postage company. Very few professional sellers and mail order outfits use USPS insurance, because UPIC is much easier - you just list customer info in monthly spreadsheets submitted to the company, and pay once a month for your costs. You can also register a package online and buy the insurance a la carte - which means you don't have to wait in line at the post office.

UPIC, like car or other insurance most people have, has a sliding scale depending on how many packages you ship and to where. Unlike USPS insurance, there will be no "proof" that is stamped on the package that insurance was used. I use UPIC only, and when I charged for insurance as an itemized cost, I had to explain that it does not involve a big green stamp on their package.

You're also forgetting that the responsibility for safety still lies with the seller. Insurance is not just for the buyer, it's for the seller too. I would only be suspicious of those sellers who claim in harsh language that if you don't pay for insurance, you're SOL. That - to me - implies that this person is more likely to ship you an item and then blame you if it arrives damaged. They don't have the force of the law behind them, but I think it's nuts to do business with such people anyways. Whether you pay for insurance or not, the seller and carrier (like the post office) are both still responsible - not for you having a bad day, but for making sure the package arrives safely and in a timely manner, in accordance with FTC rules. Good business means that you want to protect your relationship with your customer, and that means being proactive and positive.

The seller has a choice between integrating insurance costs into the overall postage and handling, or asking for a separate payment. Many people assume, as you stated, that insurance is just a "ploy", even when shipping fragile or damaged items, so many antiques, fragile and professional sellers ask for one sum that covers all costs - postage, handling and insurance together.