>>I think that's just semantics. Many schools self insure. Obviously the cost of self insurance comes from somewhere, whether it is higher tuition or fund raisers (I'm talking about private scahools).

Thats not just a matter of semantics. Though the schools may use money that makes from tuition to self insure ITSELF for its own liability to others, the school does not charge students for "insurance" and if they choose not to purchase the insurance tell students that the school is therefore absolved from liability to a student injured by the school.

>>Would you have been happier if Joe just increased postage and not charged for insurance

I am not talking about anyone in particular, just responding to your initial question. I think a seller on Ebay who wants to charge more for shipping than there actual cost should be allowed to do that (within reason) SO LONG AS THEY SIMPLY DISCLOSE THAT FACT. I think any seller who specifically states he is charging for insurance should have to purchase insurance from the Post Office (or other carrier) or from an appropriately licensed insurance company.

>>I assumed the whole point was there would be a reimbursement or replacement no questions asked.

Well what happens when you email the seller and say that your item never arrived and he calls you a liar and says you are just trying to steal his money and the item. What recourse do you have? Are you going to sue him over a $100 chip? Since he profits by not paying out the claim he has an incentive to deny your claim.