A high-filling alumina/epoxy nanocomposite with improved thermal stability and insulation performance has been successfully designed as an organic–inorganic coating layer for the toroid-shaped FeSiBPNbCr amorphous magnetic powder cores (AMPCs). Unlike the organic coating, the organic–inorganic hybrid coating cores exhibited superior magnetic properties without compromising on saturation magnetization and permeability. The core loss declined by 40%, and the quality factor was 13% higher as half alumina was introduced into the epoxy resin matrix. A thin and uniform-coating layer of alumina/epoxy nanocomposite led to better high-frequency characteristics than those obtained with direct coating of the cores with alumina. Besides the outstanding magnetic properties, the Fe-based AMPCs with a convenient insulation-coating process cost lesser than Fe–Ni magnetic powder cores, thereby rendering the Fe-based AMPCs a potential candidate for a variety of industrial applications.