The deeper answer
What changes the decision.
The wall behind siding matters more than the surface you see. A full tear-off lets the crew inspect every elevation for soft sheathing, old leak paths, failed flashing, insect damage, and uneven substrate. Those problems cannot be reliably diagnosed through an existing siding layer.
Once the wall is open, damaged sheathing can be documented and quoted before it is closed. The crew can install a continuous water-resistant barrier with correct laps and tape details, then integrate window, door, chimney, and roof-to-wall flashing. That is how water gets directed back outside instead of trapped in the wall.
An overlay saves demolition time, but it adds thickness at openings, changes trim geometry, and can leave the new siding sitting on a wavy or wet surface. It also gives everyone an excuse not to inspect what is underneath. The short-term savings is purchased by accepting uncertainty in the most important part of the project.
Ask every contractor to write the tear-off scope, disposal, sheathing allowance, WRB brand, flashing details, and trim reconstruction into the quote. If the proposal only says ‘install siding,’ you do not know which wall assembly you are buying.