The invention discloses a retractable grounding wire with an insulation handle, and relates to the field of connecting components hanging on overhead lines or the other suspension lines used for making conductive parts connected with one another. By means of the retractable grounding wire with the insulation handle, the problems that according to a throwing grounding wire, time and energy are wasted in the throwing process, or the personal safety is endangered due to violation of regulation, for example, the grounding wire is directly taken by a hand for installation are solved. The retractable grounding wire comprises an annealed copper wire and a grounding wire clamp fixed to one end of the annealed copper wire, and further comprises the telescopic insulation handle and a reel fixed to one end of the insulation handle; the annealed copper wire is wound in the reel, one end of the annealed copper wire is grounded through the grounding wire clamp, and the other end of the annealed copper wire is connected with a wire end clamp after passing through the insulation handle. The retractable grounding wire with the insulation handle is used for installing the throwing grounding wire.