I'd be concerned about bacteria counts in incoming water, especially if its insulated.
I use on-demand water heaters, not tanks, and filter the water at the point of use. I'm installing a copper reservoir tank in the attic (avg temp is 80F up there, incoming cold city water is 45F in winter and 55F in summer). That means the heaters don't have to work so hard, even though my hot water heating costs dropped by over 60%. US Made in Puerto Rico too. Marley's SANTON heaters were made and sold in the UK for over 20 years. Marley made them under license, and just got their UL/CSA labels.
I'm frugal, not cheap.