Have you seen this rotten wiring with your own eyes or are you just assuming it's rotten?

The cheap plastic socket for the H7 lamps crumbling apart isn't the only thing happening.

The female parts of the connection (the ones in the socket that the blades of the H7 go into) loosen. This results in an ineffective connection. You get more heat. Lots of times you get scorching and blown fuses.

On 4 of these cars I've simply cracked away the cheap plastic socket body, pinched the female connectors a bit with pliers to increase bite and plugged the light back in. It doesn't matter which wire goes on the bulbs' blades as a filament light bulb isn't polarized.

In all these cases blown fuses was a symptom.

The structure and length of the connector keep the wires separated every time. They actually cannot short.

As I recall there has never been a case where the wire insulation was even involved. The insulation always looked good.

If indeed you have cracked insulation I'd consider doing a neat electrical tape job.

I add a THIN wipe of silicone grease to the bulbs' blades to ease assembly.

Honestly, try that first.

I too bought a replacement socket and I've never needed it. I just did what I described above. I bet it'd work the same for you. Don't go nuts cutting back into the car's wiring. It VERY LIKELY isn't necessary.