The shipping you pay for is insured up to a limit, if your object is worth more than the limit they want you to declare it. Let's say you ship a toaster, it gets to it's destination broken. Now you say it was a one of a kind toaster that won design awards and is worth $25,000. Don't you think UPS is entitled to know that beforehand and maybe charge extra for handling? Since you have to pay extra, and UPS doesn't usually look inside your box, this might also help to keep people from shipping things "pre-broken" or claiming that $100 item was worth $250
Sure I think it sucks in some ways but I live in CA and if I ask you to work on my lower I would understand if you refused because if you break it, you CAN'T replace it.
I'm also certain UPS won't admit the revenue they get is a major factor.