This article is about the effects of insulation thickness on the life cycle costs of steel pipes inside the pit (channel, duct) or above-ground structures with different diameters and sensitivity to economic parameters. The heating degree-day and life cycle cost procedures are used for the optimization and sensitivity analyses. For Afyon province in Turkey the fuels are coal, natural gas and fuel-oil. The insulation materials are rock wool, EPS and XPS. The results show that consideration of all the physical and economic conditions appear with the optimum insulation thickness that varies from 5 cm to 16 cm. Both lifetime and unit cost of insulation are sensitive to the insulation thickness. Additionally, the increased discount rate and cost per unit volume of Insulation material lowers the optimum insulation thickness. In conclusion, it is expected that this study will provide a guide for engineers, where insulation is used for large diameter pipes. (C) 2016 Elsevier Ltd. All rights reserved.