Thermal insulation is one of the most effective methods of reducing energy consumption in buildings. Therefore, the parameters influencing the optimum insulation thickness are widely investigated. In this study, the optimum insulation thickness is obtained using the life cycle analysis method and the genetic algorithm by considering the size of the heating and cooling systems as an optimization variable, which has not been addressed in the earlier researches. Furthermore, the effect of the climate conditions on the optimum insulation thickness is comprehensively studied using five different climate zones, including Hot-Dry, Cold-Dry, Moderate-Humid, Hot-semi Humid, and Hot-Humid. It is found that the optimum thickness of expanded polystyrene insulation increases between 5%-19% considering the size variation of the heating systems including the central heating system and wall-hung gas boilers. By size variation of the cooling systems including the evaporative cooler and split air conditioner, this increase is between 8-19%. This is because the cost reduction due to the reduction of the required size of the heating and cooling systems can be expended for insulating the building with larger thickness which results in lower energy consumption. Based on the obtained results, the energy cost saving increases between 3.5%-14.5% and also, the payback period decreases about 1 to 3 months, depending on the considered heating and cooling systems and climate zone. The results confirm that the optimum insulation thickness can be determined with significant inaccuracy, ignoring the size variation of the heating and cooling systems as a result of thermal insulation.