Several insurance companies will not take on the risk of obsolete wiring in homes and may refuse to continue coverage at renewal or insure a new purchase if the knob and tube wiring isn’t replaced with more modern wiring. Often, they give very short timelines for this retrofit, and if you can’t comply, you’ll find yourself without insurance and in hot water with your mortgage provider. 30 days seems to be the norm now a days.
Sellers if you can afford to upgrade wiring before listing, this will benefit the sale so that there are no surprises being denied insurance coverage which results in no mortgage. Sellers may also see a higher return in form of profit as the new buyers have nothing to do but move their furniture in. Call a few electrical companies and ask about rates and if they also do the repairs after the work is done.