Water heater insulation wet inside

[genocyber76]

I recently had a couple of pipes burst in the ceiling over my garage. Whole garage was flooded. When the plumber came out to repair the pipes, he informed me that the insulation inside the water heater was wet and per manufacturer, needs to be replaced. The water heater is the original when the house was built jin 1994. I am unsure of the make and model as it has a wrapping on the outside. I was hoping someone might know about this and could offer a second opinion. Any info on this is much appreciated!

 

[phishfood]

Considering that the water heater is 20 years old, wet insulation is not the only reason to replace it.