This is a real shame.
For one, I don't think you can collect on insurance for something improperly packaged by the shipper. At least, I know if UPS saw that, they'd tell you tough sh**. I would think FedEx is fairly similiar. Insurance is generally only paid out because of the negligence of the shipping company, not because the shipper is lazy and improperly packages an item.
Yes, tampa, you're fully in the wrong here. I can't even begin to fathom the reasoning that it's the buyers problem because his head arrived looking like it was repeatedly hit by a sledgehammer.
Just because the buyer wanted the best deal he could doesn't make him cheap. It makes him smart, because, had all things been equal, he would have received a part he could have used for lower than going rate. Of course, in this case, all things weren't equal because you skimped on the shipping and packaging so badly it made his purchase useless.
Also, you did not have to take the buyer's offer. If you think this was such a lowball offer, maybe you should have held onto it. Just because someone wants something I sell for 280 bucks, when I normally sell it for 380 bucks, doesn't mean I have to take their offer. Pretty weak excuse in my book for claiming that. Pure ignorance. You took the guys money, and wanted to keep as much of it as you could. In the process, you sent the dude a jacked up part because you got cheap. Nobody's fault but your own.
Also, as a note to the buyer - you purchased a fully functional VE head, and received a mangled piece of garbage.
That is technically misrepresentation of goods, and if you used a US Postal Service money order, it could be considered a form of mail fraud. This is why ANYTIME you use money orders, you should use postal money orders.
If you did purchase a USPS MO, you might want to check into the process of filing for that to get your money back.
-Zack