A detailed statistical theory of atom-diatom insertion reactions is derived by combining the early statistical ideas of Pechukas and Light with the coupled-channel capture theory of Clary and Henshaw. The theory is applied to the N(D-2) + H-2 and O(D-1) + H-2 reactions and found to give results in good agreement with the exact quantum mechanical integral cross sections reported recently by Honvault and Launay.