Heating Wrapped Challah on Shabbat
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Question
Is it permissible to heat challah on Shabbat, in a permissible manner such as on a water heater, when it is wrapped in aluminum foil or cling film, or is there a prohibition of insulation?
Answer
Shalom and blessings
It is forbidden to heat anything on Shabbat when it is completely covered by something intended to retain its heat, due to the prohibition of 'insulation'. However, this only applies when the covering is meant to retain heat, but if the covering is intended to protect from dirt, or to prevent it from falling or crumbling, it is permissible to heat with the covering, and this is not considered insulation.
Source
Shulchan Aruch, Orach Chaim 257:1-2