It depends on how the circuit is wired. In my house (circa 1978, USA) the switch is in the middle of the circuit and the lights are at the end. So the neutral (white) is connected via wire-nut inside the switch box. Like this .

However, if there is no neutral in the switch box it is probably wired with the switch at the end of the circuit. Like this .

Connecting the Insteon devices to the bare (ground) wire would work because the neutral and ground are connected (bonded) together inside your breaker box. It might not work on a circuit using a GFCI breaker, which trip at under 10 mA (I'm not sure how much current the Insteon devices require to operate). It would be reasonably safe, as a minimal amount of current through the ground wire would not cause a significant rise in ground potential anywhere in the circuit. The only problem occurs if the ground wire is severed and the lamp and switch housings become electrically charged. It definitely would not be up to code.

-Jeff
(EE, but not an electrician)