Product: Credit card or prepaid card

I ordered a part needed to repair my living room heater : The seller sent It Priority Mail by the USPS with 3 day delivery. According to the USPS it arrived on a certain day and was left in my mailbox : I live on a rural street and my house is set back from the street so you do not see it. I never got it the item but there was a fair amount of mail in my box that day!! After much back and forth the USPS said it was not their problem and on top of that they were not going to pay the insurance I had because it was delivered. They claim it must have been stolen from my mail box which makes no sense! Anyway, I ordered a 2nd gas valve and paid this time for overnight shipping with XXXX  to make sure it arrived the next day as I had an appointment the next day to install it which had taken me two weeks to get : I needed my heater to work so I really had no choice. 
I then filed an insurance claim ( in addition to the original missing item claim ). The Post Office denied my claim saying they would not cover the insurance BECAUSE the package had been delivered!!. 

I filed a claim with Citibank XXXX XXXX as my card has a feature to cover damage or theft. I explained the story and pointed out they could see the original item in my XXXX statement and they would see the same item again that I had to reorder in the XXXX statement for an extra {$40.00} to cover the overnight service from UPS. 
Citibank replied that they would not honor the claim because as they put it : XXXX  XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX, FL XXXX XXXX Toll-Free XXXX Fax Case Number : XXXX - Citi card ending : XXXX Dear XXXX XXXX : Thank you for your recent claim request. Regretfully, your claim is not eligible for payment for the following reason ( s ) : The Item was under the care and control of a third party. 

Your claim is denied because per the Terms and Conditions, coverage doesnt apply if the item was under the care and control of a third-party including, but not limited to, the U.S. Postal Service, airlines, or delivery services. 

If you have any questions, please call the Citi card benefit service center toll-free at XXXX ( Speech/hearing impaired : XXXX or other XXXX XXXX ). Our representatives are available Monday Sunday, XXXX AM XXXX XXXX XXXX. 

In making this denial, XXXX XXXXXXXX XXXX expressly reserves all of its rights and defenses under the policy and does not in any way waive any right or defense which the company may have. If you have additional information regarding this claim that you would like us to consider, please forward it to us for review. 

Sincerely, Citi Card Benefits Administration So as you can see the Post Office is saying they won't honor my claim because they claim it was delivered and Citibank won't honor the claim because they said it was still in possession of the Post Office. I understand that mail boxes are controlled by the Post Office so I really don't know legally who is right! I have tried now several times to ask the Post Office to send me a copy of the law or regulation that confirms that once the claim to have delivered something that it is legally no longer in their possession not withstanding it was left in a US Postal mail box but they refuse saying this is not their problem. 
My thought was that with such a confirmation then Citibank would legally have to acknowledge that the item was in my possession? 
Bottom line for me is I do not understand how the Post Office can simply claim they delivered something and if the customer does not get it it is not their problem nor do I understand how my theft insurance with Citibank XXXX is not valid because the item was presumably stolen from my mail box? I did file a police report the day all this happened at the suggestion of the Post Office and I sent that report to Citibank with my claim. 
So if there is anything your office can do with Citibank I would appreciate it : the case number is XXXX XXXX : XXXX. I assume you have authority over the USPS! 

Thank you very much XXXX XXXX