For international shipping I've gone the zone rates way so I don't have to bother with it except I don't know how to introduce insured parcels that way.

For Australian rates using your module I have set the dimensions as per the padded bag size 1 which is (rounded off) 15x23 and then allowed the maximum of 2cm for width.

When you say: "In that case, you are 'correcting' the wrong thing. You should be trying to get the weights/dimensions right to classify the item(s) are large letters, not trying to compensate by introducing negative handling fees."

I totally agree except I don't understand what I might have done wrong as I think I entered the dimensions correctly.

So I took off the dimensions I entered as I figured I probaly don't need them is the module is set up for letter rates by default. But I get this message when I go to estimate shipping
Warning: Division by zero in /home/easybead/public_html/includes/modules/shipping/austpost.php on line 166

On the cart the weight is showing up properly but not on the stimation window. What is it supposed to divide by?

Thanks.