Ahoy Mates!
It's import to know your rights on Ebay and not let 'pirate' sellers abuse the system with unfair or excessive S&H (and/or insurance) rates.
To give you an example of one such case from an Ebay seller, 'que244' (aka skibunny0408), was to charging $8.00 ($6 for S&H and $2 insurance) for shipping a $5.35 1 oz. item and stated in his auction: 'We do make money off the shipping to cover the bar cost'...which is in clear violation of Ebay policy and Federal Law, not mention circumventing Ebay fees.
Ebay policy and Federal Law on insurance states: Sellers offering insurance may only charge the actual fee for insurance. No additional amount may be added, such as “self-insurance”. Sellers who do not use a licensed 3rd party insurance company may not require buyers to purchase insurance. This is a violation of state law.
Ebay's policy on S&H states: Actual Shipping cost: This is the actual cost (i.e. postage) for shipping the item. Handling Fee: Actual packaging materials costs may be charged. A handling fee in addition to actual shipping cost may be charged if it is not excessive.
It is important as buyers to know these rules and report these types of 'theft' on Ebay. As a company, Ebay is still a bit relaxed on enforcement of most of their policies but continued vigilance (and steady bombardment of emails to Ebay customer service) should help change these unjust and illegal practices.
For more information on this subject, reseach Ebay's site map under Excessive Shipping Charges Policy.
Shiver me timbers!
Cap'n Panda

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