Covering wall below top edge of bathtub

Is it a good idea to cover the wall space below the lip of the tub? One of my bathroom walls sits on an exterior wall the other two going into a crawlspace.
When i ripped the existing tub out there was no wallboard on the two sides of the tub. I'm thinking for insulation purposes i should probably cover them or at least cover the outside wall.

 

As far as I know the tub is always secured directly to the wall. That allows the cement board to go over the lip of the tub. The plastic will go all the way down to bottom plate on the exterior wall.

 

I would insulate the wall really well with something like Roxul, which won't require a vapor barrier, is vermin proof, water proof and mold proof. Since you are not likely to see this space again in this lifetime, that would ensure a little peace of mind. Adding the VB as Mark said is a good idea, although I only allow the VB to overlap the lip of the tub, where I install my CBU sitting on top of the lip. I cut the VB at the bottom of the curve so it will still be inside the shower, but will be covered by the tile that will jump the gap. I also don't caulk/silicone the bottom edge of my tile sitting on the tub. If the tub was installed level, the tile will be level and moisture that may accumulate behind the tile/cbu can run down the VB into the tub harmlessly.