A conditioned and unvented crawl space must have thermal insulation in the walls. This is especially important if you intend to encapsulate the floor and walls with a Class I vapor retarder (or barrier). A contractor doesn’t need to install insulation between the joists in the floor above the crawl space. The wall insulation performs better than the floor insulation, as it makes the crawl space drier and warmer.
Insulation will keep interior air from touching cold surfaces, thereby avoiding condensation. Ultimately, this prevents mold and moisture issues and reduces energy inefficiencies. There are numerous types of insulation, although the best insulation is made from foam and is water resistant. To prevent mildew growth, you want airtight insulation.
You should know that contractors also need to use a specific amount of insulation, which a contractor can find in the IRC. This is usually between R-5 and R-20. The R-value depends on local building code requirements.