It does look a trifle high. I ship my jewelry - anything small - in a small jewelry box inside a bubblewrap envelop, first class with delivery confirmation, through paypal 3 oz or under is $1.64. I charge $2 to cover the cost of packaging as well, and no charge for additional items.
There is no reason to ship priority unless the item is over 13 oz. Your items don't look big enough to require a priority size box. As for insurance, that's up to you. I self-insure (meaning I keep a chunk of money from my sales set aside for any mishaps) anything under about $30. Over that I purchase insurance, but I don't charge the customer for it, as I feel it's for my protection, not theirs. Again, that's a personal choice.