It’s basically the same thing as wrapping the wood into a plastic bag. When water condenses inside the plastic it has no way of escaping and starts to rot/mold the wood.
When using any type of insulation in places where temperatures can vary and humidity can get high you should always ensure the wooden parts have enough room to breathe (e.g. 10cm of empty space above them if the insulation is at the bottom).
When using any type of insulation in places where temperatures can vary and humidity can get high you should always ensure the wooden parts have enough room to breathe (e.g. 10cm of empty space above them if the insulation is at the bottom).