Here's a quick quiz for you:

If you purchase a 99 cent item and pay $10.00 for shipping, plus $1.65 for USPS insurance, for a total of $12.64 ~ What's covered?

Unfortunately, quite a few people think that all they have to do is pay the extra cost for insurance and they are covered for their entire purchase. Well, yes and no!

Insurance is only valid for the actual item cost. In the above example, the $1.65 you paid for insurance will only cover the 99 cents of your item purchased! It will not cover the $12.64 you've invested. Not a great bargain in my book.

Now in the case of an expensive item, purchasing insurance makes a lot more sense. But in this case also, you are only covered by USPS if, and I say IF, the seller has properly packaged the item for shipment. A fragile item tossed in a box by a careless (or inexperienced) seller, that will probably break in transit, will more than likely be refused an insurance claim by the USPS. You can protect yourself by being careful to buy from sellers with great feedback that show a good track record. Or, if that widget you REALLY want is from a newer seller, email them in advance of bidding and inquire as to their packaging.

This is not an all-inclusive guide to all the in's and out's of insurance, but I hope it will prove of help to some!