A lot of writers and fans say Joker is insane, but I often do not see that in the writing.
Most Joker's actions are premeditated, most crazy people do not commit elaborate premeditated crimes. A lot of Joker's actions are designed to intentionally inflict pain on others for his own amusement, that is not insane, most crazy people do not have the mental capability to know their actions hurt others. Psychopaths hurt others to gain power over them (its the M.O of most serial killers).
So is Joker insane or simply evil?
I think Joker is simply a cynical, anti social psychopath and thus not criminally insane.