In estimating the lightning-caused outage rate, insulator voltage is at present computed by neglecting the induction effects of the electromagnetic fields of the lightning channel and the magnetic fields of the tower travelling current waves. An analytical method is proposed to take these effects into account. The induction effect of the lightning channel significantly increases the insulator voltage, whereas that of the tower travelling current waves decreases the insulator voltage. However, the overall effect is to increase the insulator-string voltage, giving an outage rate higher than that by currently used methods. The proposed method of estimating the outage rate by backflash should provide a better tool for the design of the lightning performance of overhead power lines.