From BOL:

if a trigger is defined as an INSTEAD OF INSERT trigger for a table, and the trigger executes an INSERT statement on the same table, the INSERT statement executed by the INSTEAD OF trigger does not call the trigger again. The INSERT executed by the trigger starts the process of performing constraint actions and firing any AFTER INSERT triggers defined for the table.

Appears I was wrong.

Probably it was AFTER trigger which taught me never insert inserted recordset again.

🙂