I have just read another guide on this, and thought I would also share my experience.

Basically, ALWAYS send items using recorded delivery and KEEP THE RECEIPTS for six weeks regardless, never offer any other form of postage if the buyer pays via paypal, if you use first class postage you are not covered at all.

The other guy was lucky, the buyer was genuine, unfortunately I was not so lucky!

The buyer brought a pair of football boots from me for around £45. I sent the boots first class recorded to the address provided by the buyer on paypal. I never heard anything from the buyer for 5 weeks and 6 days at which point he initiated a dispute with me on paypal saying he had never received the goods. Funny that he left it exactly the right time (to the day) on the limit of raising a dispute. Within the dispute he had raised with Paypal he actually TOLD PAYPAL THAT HE HAD PROVIDED AN INCORRECT ADDRESS!!!!! and they still voted in his favour unless I could prove that I had sent the boots to the wrong address (??). After 5 weeks and 6 days of sending 20 odd pairs of boots the receipt for his pair had been thrown away (you would expect the buyer to contact you if there was a problem). I explained all this to Paypal who continually would not do anything unless I could send them the receipt to the wrong address. I am now £45 AND a pair of football boots down because the buyer gave me the wrong address!

Paypal's customer service is on the verge of atrocious, you send a complaint and you get quoted from a book, you reply and then get someone else quoting the same as was quoted before. The other day I had 5 replies all saying exactly the same thing even though for the last two I had specifically asked not to be told that!

BASICALLY: Be careful, Paypal's policies are shoddy, and leave themselves open to severe abuse, and their protection of sellers leaves a lot to be desired.

I HAVE SUGGESTED THIS TO PAYPAL TO WHICH THEY JUST REPLIED "YES":

I suggested that I go onto Ebay, Purchase twenty different items, and pay using paypal. Then leave it 5 weeks and 6 days and raise twenty disputes with all the sellers. Any sellers that had sent the goods first class would have to either refund me or have their paypal accounts suspended, and the chances are that even if all twenty sent them recorded, half of them would no longer have the receipt and I would again be refunded at the threat of having their paypal account suspended. I then asked paypal if this would happen, they had no option to agree!! WHAT A FARCICAL ORGANISATION!

SELLERS BEWARE!!!!