This is not the first time this has come up, it won't be the last.
I have no horse in this race, though I think I have dealt with Josh many years ago, I know neither party.

I always felt that it was the buyers responsibility to get payment to the seller and the sellers responsibility to get the merchandise. to the buyer.

Though I do not sell chips as a rule, if it were me, I would insist that insurance was part of the terms of sale.
If the buyer totally refused to opt for it, it would then be his responsibility if the chips did not arrive.

Me, I own a business and learned many years ago that it takes years to make a customer and only moments to lose one.
Good faith here might cost a few bucks but the seller would get it back in spades.
One might notice that as a result of this thread at least one potential customer decided not to do business with Josh.
Others I'm sure might have that in mind.

Here's something someone told me once. If I do something wrong, tell me so I can rectify it.
If I do something right, tell everyone

Was it a good choice on his part? well only time will tell.
Me personally I would take the loss