The objective of this study was intended to determine the maximum allowable initial moisture content for CLT walls having both exterior and interior thermal insulation. A laboratory test was conducted, for which four test walls with two different insulation solutions and two different initial moisture contents were built. Based on the test results a simulation model was configured and simulations using the model were completed. The results from simulation determined that the maximum allowable initial MC of the CLT panels was 17% for walls insulated additionally from inside with mineral wool (MW) and 15% for CLT wall assemblies insulated with polyisocyanurate (PIR). Based on these results it was concluded that for construction timber the allowable MC ranges between 8-16% and therefore using a PIR board as interior insulation for CLT walls should be undertaken with caution given the very small margin for error in moisture content.