Modern psychology does not define the term "sanity." Look it up in any psychology book and you'll find not a single attempt to actually define what it is to be sane.
Different countries have legal systems that define sanity, in the same way that individuals define what is and is not sane for themselves. However, it is unusual that the field most concerned with mental health and insanity has made no attempts to form a single, concrete definition for it.
There are some that theorize this situation is similar to the argument about the existence of heat and cold. Cold has a relationship with heat in that the former is the absence of the latter, nothing more. Is it possible that sanity doesn't actually exist and is merely the absence of insanity?
Legal and mental health institutions round the world have volumes of guidelines and criteria used to determine if someone is insane, but not even a single line to mark a person as being sane.
If you take the time to analyze it, it almost seems as if mental health experts believe marking someone sane to be a diagnosis of exclusion.
There are hundreds of potential problems in psychology and psychiatry, with the list including anxiety disorders, depression, insomnia, psychosis, and dissociative personality disorder. All of these examples are considered to be signs of insanity, albeit the intensity varies from problem to problem, and person to person. However, most psychologists seem content to pick away at possible problems until they run out of options before declaring you sane.
It is also interesting to note just how much effort psychology puts into finding and defining various forms of insanity. For example, there are currently six different forms of pedophilia. Out of the 300 major psychological disorders, a startlingly large amount are considered to be connected to sex and sexual health.
There are a few disorders that are used to describe mood and mentality changes brought about by the weather and other factors in nature that affect us. Social and familial relations are also taken in as an avenue of study, typically with disorders that are inevitably linked to disorders in other fields. So literally, there are thousands of ways for a person to be insane to some degree, but no way to tell if a person is sane. For some, this actually poses a most intriguing conundrum: does sanity even exist?
That question, while probably not taken seriously by the vast majority, does put an old adage in a new light. There are some people that often joke that everyone's insane, that the appearance of sanity is just a matter of how much insanity is present.
Given that sanity is not defined by psychology, the field that ought to be the most concerned with understanding it, the joke may not necessarily be completely untrue. There are ways to determine sanity, but these are based on the legal definition and are used strictly to see whether someone was legally liable for a crime or not. However, not being criminally insane does not automatically make a person "sane" in the psychological sense. After all, only a small percentage of the various mental illnesses out there can actually lead to criminal behavior.
Of course, all this could simply mean that the dividing line between sane and insane is up to the individual observers to determine. That brings a number of risks, as the observations and definitions are likely going to be highly subjective. Even sanity in the legal sane is subjective, as different jurisdictions define it differently.
The lack of a credible source for what makes a person sane may be psychology's way of telling the world that sanity doesn't exist. Now there's a disconcerting thought...