no it's not 'necessary', the original stuff was cloth covered, then a little later, cheap pvc .... both have lasted the 40-50-60 years these vehicles have been in service without melting even laying on the engine .... just make sure any wiring you do is properly routed and secure so it doesn't flop around
"Cross-linked polyethylene" is otherwise called PEX, as in the plumbing tubing, if you're wanting your wiring to last 100 years, go to a plumbing store and buy some PEX tubing to use as 'conduit'

Bill