Unlike what most of us believe, there is no absolute reality. Reality exists only by consensus. The beauty of it is that there is no way we can verify if the Reality that you and I are agreeing to is indeed the same one but Mankind so far has somehow managed to share a Reality, at least of the world of appearances. The large majority of people who do agree with the consensus view of Reality are the ones that are called 'Sane' and they are the ones whose example is used to define 'Sanity'. There are however some people, very few mind you, who do not agree with the consensus view of Reality and challenge it. These people are called 'Insane' by the 'Sane'. 'Insanity' is defined by their example.
Apart from the fact that the two groups of people do not agree with each other and one is in majority and the other in minority, there is no real difference between the 'Sane' and the 'Insane'. Both have a fixed idea about the world, both see a structure in the way it exists and both are fairly certain about it. Most great artists belong to this minority called the 'Insane' and therefore are almost never fully appreciated for their work until much later when the majority view of the world has changed.
There is another set of people that is much rarer, the truly 'Mad'. These are the people who are neither 'Sane' nor 'Insane'. They neither agree nor disagree with anyone. They do not have a fixed idea of Reality and never feel the need to. We call this 'Madness'. Some among the 'Mad' have taken the pains to explain to the rest of us that Reality is not to be defined but to be experienced and the very act of defining a Reality apart from us only obfuscates it rather than make it more clear. But then again why would we 'Sane' people listen to a madman.