In what I've read, the "READY" indicator is present on hybrids as a replacement for the sound of a running engine. It's there to indicate the vehicle is on and operational even though the gas engine may be off and the engine compartment is silent.
Referencing this site (
https://www.greencarreports.com/news/1108160_explaining-how-honda-accord-hybrid-system-works-video), I think the risk of "premature driving" might be on the electric motor, since it's engaged in EV or Hybrid mode at start-up. (Car can't be in Engine Drive mode when starting.)
- EV Drive = electric motor to drive the wheels
- Hybrid Drive = electric motor to drive the wheels, while the gas engine recharges the battery pack using the second motor as a generator
- Engine Drive = gas engine directly powering the front wheels; a clutch that is disengaged in the other modes locks the engine and propulsion motor together
However, the Insight's gear selector is "shift by wire" which manages the transmission mode via electronic control instead of mechanical link from the gear shifter. Per this site (
https://en.wikipedia.org/wiki/Drive_by_wire), "the direction of motion of the vehicle (Forward, Reverse) is set by commanding the actuators inside the transmission through electronic commands based on the current input from the driver (Park, Reverse, Neutral or Drive)." If the electric signal didn't make it to the actuators, the direction wouldn't engage.
Net, since these are electronic signals I don't think there is any wear... AND since the car still ends up moving in the desired direction my (non-professional) assessment is that things are working as they should, by electronic activation of the right components in the right sequence. Maybe the electronic signals are sent to components even faster than the "READY" indicator can detect.