When the 110 kV power system suffers from asymmetrical short circuit, non-full-phase operation, and lightning strikes, a large overvoltage will appear at the neutral point of the transformer in the substation and endanger the neutral point insulation. Therefore, it is necessary to study the over-voltage and insulation coordination of transformer neutral points. This paper builds a simulation model of 110 kV power transmission system in PSCAD/EMTDC, calculates and analyzes the neutral point overvoltage when various faults occur on the line, and determines the discharge gap distance based on the obtained overvoltage value to achieve good insulation coordination. The calculation results show that the maximum overvoltage at the neutral point reaches 117.73 kV when a single-phase ground fault occurs on the line; the maximum overvoltage at the neutral point reaches 52 kV when a single-phase disconnection occurs; the maximum overvoltage at the neutral point reaches 118 kV when a lightning strike occurs; a better insulation coordination effect can be achieved when the discharge gap distance is 13 mm~14 mm with the parallel arrester. The research results can provide important theoretical and experimental reference basis for insulation coordination of 110 kV transformer neutral point.