Previous studies suggested that the observation of other individuals' somatosensory experiences also activates brain circuits processing one's own somatosensory experiences. However, it is unclear whether cortical regions involved with the elementary stages of touch processing are also involved in the automatic coding of the affective consequences of observed touch and to which extent they show overlapping activation for somatosensory experiences of self and others. In order to investigate these issues, in the present fMRI study, healthy participants either experienced touch or watched videos depicting other individuals' inanimate and animate/social touch experiences. Essentially, a distinction can be made between exteroceptive and interoceptive components of touch processing, involved with physical stimulus characteristics and internal feeling states, respectively. Consistent with this distinction, a specific negative modulation was found in the posterior insula by the mere visual perception of other individuals' social or affective cutaneous experiences, compared to neutral inanimate touch. On the other hand, activation in secondary somatosensory and posterior superior temporal regions, strongest for the most intense stimuli, seemed more dependent on the observed physical stimulus characteristics. In contrast to the detected vicarious activation in somatosensory regions, opposite activation patterns for the experience (positive modulation) and observation (negative modulation) of touch suggest that the posterior insula does not reflect a shared representation of self and others' experiences. Embedded in a distributed network of brain regions underpinning a sense of the bodily self, the posterior insula rather appears to differentiate between self and other conditions when affective experiences are implicated.