You'll be liable for 20% VAT on the cost of the watch plus postage. There will also be a carrier's charge of somewhere between £8 and £20, depending on who delivers it. There's no duty payable on single watches.
In terms of insurance, it depends on who is taking the risk. If you pay using PayPal (NOT PayPal Gift or PayPal Family & Friends), then you should have Buyer's Protection and it will be down to the seller to ensure that it is insured (unless you agree otherwise). If you're paying by some other method, then it's probably in your interests to insure - including making sure that watches are covered (not all carriage insurance will cover watches/jewellery) and that the postage method chosen allows watches to be transported.