I read a thread David v Goliath thread 419960 on this site with a very similar issue to mine.
I sold on ebay an expensive piece of yacht equipment for £1000. The buyer told me not to bother with extra insurance as he understood that eBay would compensate any loss. He was wrong sadly. The parcel was "lost". I have been through the whole appeals process with Ebay but they have returned the buyer his money and I am £1000 out of pocket.
The item was sent through UPS via Pac