Short Answer
No. But removal may be preferable when it allows the contractor to inspect and correct sheathing, flashing, water damage, weather-resistive barriers, insulation, and structural problems.
Detailed Explanation
Removing old siding adds labor and disposal costs, but it provides a significant benefit: full visibility of the wall assembly beneath. With the old siding removed, the contractor can inspect the sheathing for rot or damage, check and replace flashing around windows and doors, install or upgrade the weather-resistive barrier (house wrap), identify and correct structural problems, and ensure proper integration of all water-management components. Installing over existing siding means none of these things can be fully evaluated or corrected. The decision depends on the condition of the existing assembly, budget, and the homeowner's priorities. In many cases, the long-term benefit of removal outweighs the short-term cost savings of installing over.
Why It Matters
Removing old siding allows inspection and correction of hidden problems that would otherwise compromise the new installation's performance and longevity.
When Repair Makes Sense
Existing siding is in excellent condition and removal would add significant cost without benefit.
When Replacement Makes Sense
Existing siding shows signs of damage, the wall assembly hasn't been inspected, or the homeowner wants the assurance of a complete evaluation.