I live in the UK, a lot of people do it due to the fact that we live in 'rip off britain'.... we can get taxed upto 30% extra (asked on here at some point once and then did some digging...)
I've personally been smacked an extra 22% at the most on electrical goods... which nearly bumps your price up by 1/4
Sucks
A lot of people do this in the UK, and I've never known (as yet) for it to be used in any other way than to avoid huge tax charges.... putting up to a possible extra 30% on the price of something that you have imported on expensive goods, can soon put your budget way over...
Not that I'm condoning this in any way.... but if you put insurance on this for $50, then that is the proof that this was only insured for $50...
I know once of a friend who was scammed by a US seller on ebay, for a mountain bike which was supposed to be worth about $3000... the agreement via email was that the insurance would be to cover that item at $3000, but when it was sent, the insurance was only paid to cover upto $250 or so...
When he tried to claim this off of the seller, they said that he could only claim upto $250 for it due to the insurance they put on it...
My friend had emails to prove agreement on the cover, and got in contact with the insurance people / postage company, and the seller then ended up having to pay the rest which was $2,500...
So, if you've agreed to insure for $50, and you have proof of agreement, which email is... then its your choice... if its a second hand knife, then technically it doesn't have a retail price anymore, so you could say its worth whatever you want... you could sell it to a mate for $10 if you were mad enough too... this isn't me suggesting a way to bend the rules, this is trade law (father is in trading standards).
If a tracking number is provided, the seller can see that this has been posted as well...
I am a completely honest person, and have thought about the 'for sale' section and that a lot of sellers don't sell outside of the US... I would really like to think that when I can afford to buy an older classic blade, and when I've become a trusted member - it may make some sellers accommodate me re: shipping abroad, if all costs are covered from my end of course...

there are still some honest people in the world afterall
One day hehe