Abstract: Soft magnetic composites (SMCs) have emerged as the critical materials in high-frequency power electronics due to the superior high-frequency low-loss characteristics and three-dimensional formability. The FeSiCr and Fe-based amorphous/nanocrystalline soft magnetic composites represent the current mainstream systems. As the core processing step, the insulating coating technology directly determines the comprehensive properties of soft magnetic composites, including electrical resistivity, permeability, core losses, and mechanical stability. The compositional design, fabrication processes, and application-specific adaptability of FeSiCr powders, Fe-based amorphous powders, and Fe-based nanocrystalline powders were systematically reviewed, and the inorganic, organic, and hybrid inorganic-organic coating methodologies were discussed. The material systems, processing routes, and underlying mechanisms governing microstructure evolution and macroscopic performance were further elaborated on. By comparing the coating effects on eddy current suppression, thermal stability enhancement, and interfacial bonding, the nonlinear coupling relationships among coating thickness, uniformity, and magnetic properties were revealed. Additionally, the common characterization on coating performance were introduced, offering the theoretical foundations and technical references for the engineered development of high-performance soft magnetic composites.