Heck give me a scooter that does max 100 and i'd take it out on the highway while feeling secure. I'd tick off a lot of drivers but I wouldn't have a problem.
Like the other day i was travelling at least 30 km/h faster than the slow pokes parked in the left lane. One decides to pull in front of me. I ended up going around him on his left (in his previous spot) and then back into the middle. No power, no brakes. The 250R, which to answer your other question handles amazingly, and i'm guessing your 125R have the agility to compensate in dire need.
Watch this video to see how power or even brakes couldn't help this guy. He should have maneuvered around the @$$H@T in the white car.
http://www.break.com/index/motorcycle-totalled-by-collision-with-car.html
Power to me is only an issue if you need to go faster (which I don't think you do at 120), or cruise at a decent RPM for long periods.
Personally I believe you shouldn't upgrade bikes (if the reason is only because lack of power as mentioned above). Instead spend the money that you would be giving away to the insurance company to upgrade your skills and confidence with advanced lessons and track time. To me getting a bigger bike will only mask your insecurities, you need to do something to eliminate them. Riding scared is NEVER a good thing.