The two terms are used loosely and often interchangeably, which causes real confusion in quoting. Insert molding places a component, usually metal, into the tool and molds around it. Overmoulding molds one polymer onto another. Two shot molding does the overmoulding in one machine with one tool. Knowing which you are asking for changes the tooling quote substantially.
Insert moulding
A pre made component, most often metal, is loaded into the mold before the shot and the plastic forms around it. The insert can be a threaded bush, a stamping, a pin, a bearing or a magnet. It needs one tool, features to locate the insert, and a loading operation each cycle, which is manual at low volume and robotic at high volume.
Overmoulding
A soft polymer is molded onto a rigid one, usually for grip, sealing or damping. The rigid substrate is itself a molded part, which means either two tools with a transfer between them, or a two shot tool. Bond strength comes from the material pair and, where no compatible pair exists, from mechanical interlock designed into the substrate.
Two shot molding
Both materials are molded in one machine with a rotating or shuttling tool, so the substrate never leaves the mold between shots. It is fast, repeatable and the most expensive to tool, because you are effectively paying for two tools that must register perfectly. It becomes the right answer once the volume amortises that, which is usually well into the hundreds of thousands.
Choosing between them
If the second material is going onto metal, that is insert molding whatever anyone calls it. If it is going onto plastic, the question is whether the volume justifies a two shot tool or whether two separate tools with a transfer operation is cheaper. Below high volume, two tools nearly always wins, and it also lets each part be sourced separately.
Questions people ask about overmolding vs insert molding
What is the difference between insert moulding and overmoulding?
Insert molding places a pre made component, usually metal, into the tool and molds around it. Overmoulding molds one polymer onto another.
Is two shot moulding the same as overmoulding?
Two shot is one way of doing overmoulding, in a single machine with a rotating or shuttling tool. The alternative is two separate tools with a transfer between them.
Which is cheaper to tool?
Insert molding needs one tool. Overmoulding with two separate tools is next. Two shot tooling is the most expensive and pays back only at high volume.
How do I decide?
Metal insert means insert molding. Polymer on polymer means overmoulding, and volume decides whether it is two tools or a two shot tool.