The actual insulation is stupid cheap when you look at the ROI. However, installing in on an existing house is really tricky and you can cause a lot of moisture related damage if you do it in the wrong way.
This makes insulating this house an absurdly bad financial decision, since once you have moisture damage in any part of this material, you can basically demolish most of the walls since it soaks like a sponge.
Mind you, I have not started going into the pitfalls of the legality of even touching a house this old in Germany, where you have to deal with "Denkmalschutz".
Insulating new construction and retrofitting insulation are two absolutely different things and barely have anything to do with each other from the cost-benefit ratio.
My house in Sweden is from the 1950's and I still had to be _very_ mindful when adding insulation. The best thing I've found is cellulose-based insulation, basically shredded newspapers lined with salts and pressed to sheets. The can buffer a lot of moisture without developing mold.
In old buildings with solid walls you can get condensation on the walls that will evaporate because the living space is heated and we'll ventilated. If you clad that wall in insulation you can prevent the evaporation which leads to damp problems.
Newer building codes have started to mandate more external insulation:
* https://www.buildingscience.com/documents/insights/bsi-001-t...
Depending on the climate zone, up to half the insulation may be mandated to be on the outside (behind some kind of cladding (brick, stucco, siding) to protect it from UV and bulk water).
Per the above article, by having the outside be insulation, your interior structure is kept warmer, and so condensation is less likely to occur.
Do a search for "Joseph Lstiburek" and "Matt Risinger", who have lots of articles and videos on building science.