A factory reset can help with issues on a phone that started after a system update. The reset removes any leftover code from the old version of the OS that is causing conflict with the new version. It will also clear an temporary files that were not deleted after the update. While they are a pain, you should be willing to complete that factory reset step before replacing the phone. There is no guarantee that the replacement phone may or may not have the update too. Eventually the update will install itself on a replacement phone if it didn't come with the update already installed.