A few weeks ago, I dropped in on Ward Hensell, who builds tiny structures (Bodega Portable Buildings) in Sonoma County, Calif.
These are my favorite tiny homes; they are built with 1⅛″ plywood, so no framing necessary, and the pop-outs are a unique feature, both visually and practically. He says buildings this small don’t need insulation (at least in Calif. climate becuz they’re so small). The pop-outs don’t count as floor space, so you’re still within county rules where no permit is necessary for an under–120 sq. ft. structure.