What is happening to the surface of this shutoff valve?
You can replace the handle but you've probably have to take it off a new valve that you'd buy. No reason to do that though, just wire brush the valve and throw a little rust remover on it. That's the main shutoff and there could have been a leak above it ,maybe on another faucet, that just ran down the pipe before or after the insulation was added. So clean it up and keep an eye of it to see if it starts to rust again. I wouldn't worry about operating the valve as they are probably the best valves on the market.