The general rule, according to my reading of the UCC, is that an eBay seller retains title (ownership) until the goods actually pass into the possession of the buyer or are accepted by the buyer as good. Until that point, the risk of loss remains with the seller. The seller would thus be liable for any damage or failure of delivery. http://www.law.cornell.edu/ucc/2/2-509.html
This can be altered by express agreement, but it is my view, for many of the reasons stated in other posts, that stating that a buyer has to pay extra for insurance or else bear the risk of loss is not actually going to relieve the seller of liability for loss. This could be argued about for a while and I could be wrong.
More to the point, however, it is probably good business practice for a seller to accept responsibility. Take what happened to me recently. In April I ordered two $12 collar pins from an outlet in Texas called Broderick.com. When they hadn't arrived a month later, I emailed and complained. They didn't argue, or blame it on the carrier, and instead just sent me two more pins. Two days after the pins arrived, the postal service delivered the original pins, with a post mark showing that it had been mailed back at the time I ordered it. Apparently the post office lost it under a desk or something for a month. I contacted Broderick and offered to pay for them or return them, and Broderick said, "How about $7 and we'll call it square" (or something to that effect). I now have four pins. Broderick probably lost money on this deal, but I also went on Styleforum and recommended them for anyone looking to buy collar pins, and I'm giving them another plug here: http://www.highlandpark.com/x4/ElegantJewelry/15w.htm
. It is good business practice.