AbstractAssessing the insulation condition of oil‐impregnated paper (OIP) bushings is necessary to guarantee the safe operation of power transformers. Moisture is the main threat to the insulation of OIP bushings. Therefore, accurately estimating their moisture value is crucial to keep power systems running smoothly. However, it has been suggested that the ageing status of OIP bushings should be considered while assessing the moisture. Dielectric frequency‐domain spectroscopy (FDS) has been extensively employed for assessing insulation condition of OIP insulations due to its benefits. A new approach was proposed to assess the insulation condition of OIP bushings using FDS results. Various OIP samples with various moisture levels and degrees of polymerisation (DP) were selected. The extended Debye model (EDM) parameters related to each sample were calculated using their tanδ − f curve. A time constant database (TCD) was created using the obtained time constants of EDM, which includes the dominant time constant and time constant related to the R0 – C0 branch, and their corresponding insulation condition. Then, a method was introduced based on the created TCD to estimate the insulation condition of OIP bushings. The results showed that the average relative error of moisture and DP estimation is 8.33% and 6.32%, respectively.