The US Post Office does the same thing. Let's say I mail a pkg. to someone and insure it, and they claim that it was damaged in the mail. To get the insurance, they have to relinquish the item to the post office. It cannot go back to the sender.
I once sold an item on ebay and this happened. I do not believe that the item was damaged, because it was very carefully packaged - I think the person thought they would get to keep it and the insurance.