Insulation under bay window

[happydayz22]

Hi, this is my first post so apologies if this is a silly question, but we are getting our room re-plastered next week and under the bay window was just wooden panelling which we have removed to find the below insulation. As this is old insulation (it's a 1930's house) what new insulation would you recommend we replace it with ready for the plasterer to board over? Is there anything else we need to consider? Sorry if this is an obvious question, this DIY stuff is all new to us! Thanks in advance for any suggestions

 

[foxhole]

You could improve the insulation and also use insulated plasterboard over it. You would lose just a few inches of the room .

 

[happydayz22]

You could improve the insulation and also use insulated plasterboard over it. You would lose just a few inches of the room .

Thanks, is there a specific insulation you'd recommend? I have also read about leaving a 25mm air gap behind the insulation and external skin to allow condensation to escape?