Been a while since I revisited this thread (though I glance at email updates) but it doesn't look like anyone has tackled this.
Personally I gave up and now just charge everyone $0.75 for insurance. I haven't taken the time to figure out the lose/gain on the total orders but I'm sure it is not significant either way. Prior to Zen I generally took a small lose at the end of the year for shipping charges anyway.
UPS covers up to $100 without insurance so orders under that are bumping another $0.75. I think the new USPS (I only ship via Air Priority International) now has indemnity coverage around $60-75 for many Countries so, again, this level of order through in another $0.75.
Huge orders don't worry me since I just write it off towards making a nice order.
I'm sure there are other workarounds that will end up equally well. Mine is mandatory and every customer sees it before submitting anyway and no one has had an issue with it to date.
Truth is so many businesses/people overcharge for shipping and/or add a "handling" charge that my total shipping is affordable and most comment on how reasonable it is.