The seller really is the one who should be
responsible since 1) The seller is the one who
needs to file the insurance claim 2) it's the
seller's fault that the items are not insured to
it's fullest value.  (Unless at some point you
consented to it being insured to only 1/8th of
it's value.)  

The only reason why the seller is procrastinating
with the claim that I could think of is that maybe
the seller lost the proof of insurance and/or the
receipt.  And that would still be the seller's
fault.  Either way, I do think you need to pursuit
this especially since it's such a large sum of
money.  And it doesn't matter how well known and
respected this seller is, if this had happened to
me, I would never deal with this seller again. 
There are too many other sellers out there who are
much more honest and capable of dealing with
situations like yours.   

Best of luck to you.

-ix