I'm experiencing the same issue as both Sarah and Rohit and I've submitted a bug report; will update once there's a resolution/bug number to give out.
Maybe this is something of a rant but the above question from almost 2 years ago isn't an enhancement issue. It is obviously a bug, as an insert table has an expected behavior: fill out all record rows before moving on to the next. This means no spacing issue larger than the next word-wrapped record, and not dropping records between columns. Those two rules are not an art form, but the basic premise of all word processing software features, something easy enough to be implemented as a beginner project for a Python programmer. I'd love to see Esri staff in the forums be more proactive about identifying and submitting bugs rather than rely on a user to be frustrated enough to open a support ticket, document evidence, and work through that process.
That's the end of the rant.
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