What is insurance?

When buying or selling items people ask for insurance.. what is that insurance??

 

It simply means that you will be giving item/in game currency of equal worth as the item of the person who is buying your service(extraction,statting,refining etc..)
Its for preventing loss in case of theft/scam.

 

If the item gets broken than?? I heard while refining the item might get destroyed so if it gets destroyed do I have to pay for it? And what about for piercing service? Does item item gets destroyed there?

 

Destroyed?Never happened to me so I am not sure.

 

When refining you can use anti-degs or hammers to help refine. A reputable refiner will tell you whether there is a hammer involved in the refining. This isn't something that will happen often (at least not anymore). Most refiners will not opt to use hammers therefore if you pay for refine services, more often than not, your item will be fine.

 

As koko stated here only using specific special items for refining such as hammers will the item potentially be destroyed but most will just use ore or metal of some sort such as Hematite, Iron, Damascus Ore, Damascus, Mithril Ore, Mithril, Orichalcum Ore, Orichalcum and things of that nature with anti-degradation so there isn't a risk of destroying the item since if you destroy their item you would essentially be expected to pay for or replace the destroyed item ^.^