Glassfiber insulation is made from strands of glass fiber and temporarily loses its thermal resistance when it gets wet. However, if it can dry out and has not become compacted, it will retain its insulating properties.
Wet insulation in a closed wall cavity will usually not rapidly dry out. Wet insulation in a wall will migrate to the bottom soaking the wallboard and framing materials. Wetness (existing even just for a few days) will not only reduce the insulating quality …