I would think as the inspector you could cite the code section you did. As far as a solution, I would say, the service drop needs to be on a separate pole or the light fixtures need to be on the opposite (at least 270 degrees) out from what is there. Obviously you would need to talk to your boss assuming he is the actual AHJ, but that code section leaves it up to him to make the decision and I Don't think insulation is enough. Of course the local power company around here provides pole site lighting wired with their service, leaving a similar situation. One would wonder if they turn the circuit off before working in today's safety world.