From business point of view the self insurance is not feasible because wasting a lot of money in the long run and what about when you have more than 100 INR cases.

In reality buyers are thieves because they already found the loophole to lie to eBay about that they haven't received the items. To really solve this problem eBay should add to their existing policies that the seller can't be held liable for items lost in transit because the carrier delivered the items to the buyer.