Many do not use PP goods and services because if you recieve over $600/yr, paypal is required by law to send you, and the IRS, a 1099. that in itself isn't a problem since you probably lost money on the used equipment so you won't pay taxes. but it puts you on the IRS radar and you are always at risk of the IRS being difficult. everyone is afraid of the IRS.
Whether a seller buys insurance is frankly, none of your business. The seller is responsible to deliver an item intact and if not, remunerate you. They may buy insurance if they think it is a good business practice (it isn't) or just choose to take responsibility themselves (aka self insure). you asking them to buy insurance is meddling in their business and frankly stating that you don't trust them to be financially responsible.
Jerry