I have killed atleast 5 ladybugs and haven't looted a ladybug head yet. Is it a small chance that you get one or not in-game yet?   I have the tier 2 bow, hammer, and club; i just want the insect axe.....

They are in the game, guessing its just a smaller chance.

It's not a guaranteed drop, but I'd say it's about a 30% chance to get 1 from my experience. Not a terribly low chance, but it hurts when you're having trouble finding ladybugs (or waiting for respawns).

If you're really struggling, I'd suggest saving before you fight one, then reloading if you don't get it.

Same problem. Killed 4 ladybugs and still no head. Then killed one, then kept reloading and killing it 5 times and still no ladybug head. Amount of parts difers though, but never a head. Getting tired of hunting for the ladybug head.