The laser safety of small and medium-sized flying units, exemplified by missiles, is crucial for ensuring their operational stability. In this regard, the response process of an encased propellant system comprising PBT propellant, stainless steel shell, and thermal insulation layer (EPDM) was meticulously captured during laser irradiation. The temperature distribution within the shell and insulation layer was determined through high-speed infrared thermography and finite element calculation. Results show that at a laser heat flux density of 2100 W/cm2, when the contact surface of the propellant reaches its ignition temperature, introducing a 1 mm insulation layer allows dissipation of 48.6-60.1% of the heat in the 0.5-1.6 mm shell beyond the laser irradiation range, significantly higher than the 3.1-12.2% observed without thermal insulation. Simultaneously, the ignition delay time increases from 0.45-0.75 s to 1.31-14.46 s. Theoretical calculations and experimental results confirm that replacing a portion of the shell with a thermal insulation layer achieves a lower heating rate of propellant with a thinner overall thickness, resulting in a longer ignition delay time. These findings have practical implications for enhancing the resistance of thin-shell targets, like rocket engines, against laser weapon interception.