I'm looking to put up new siding on our house and I'm not sure if it will be neccessary to resheath. I currently have wood shingles (woodpecker damage occuring daily) and have board sheathing as well as blown-in insulation that I believe was installed in the 70s 80s. I see my scenario as
1. Strip old shingles, apply new vapor barrier and then new siding over old sheathing
2. Strip old shingles, old board sheathing and insulation then new insulation, sheathing and siding.

Obviously there is a cost associated with these two. Half the insulation in the exterior walls got wet two winters ago with icedams. I do not know how bad the damage was(mold and such).

My question is: what is the likely hood that I will end up resheathing. Would is be possible to remove moldy insulation(if present) and then add new insulation and siding withoput having to resheath with plywood.