This works so it must be something to do with the editor you are using:
USE tempdb;
GO
DROP TABLE IF EXISTS dbo.test;
CREATE TABLE dbo.test
(
TestTime time(3) DEFAULT(SYSDATETIME()) NOT NULL
);
INSERT INTO dbo.test VALUES(DEFAULT);
SELECT * FROM dbo.test;
DROP TABLE dbo.test;
GO
If you want a default you can use whatever you want. In a real table I would specify a constraint name istead of relying on a system generated one. eg:
TestTime time(3) CONSTRAINT dbo_test_TestTime_DF DEFAULT('0:0') NOT NULL