Insulating and air sealing your band/rim joists is one of the best bang for your buck things you can do as far as keeping the warm air in and cold air out or vice versa. This job is much more difficult if drywall is covering this area already but if not, is relatively easy and inexpensive to do. This is a pic of what I did after exposing walls in basement. In this case I applied 2 inch rigid foam board between floor joist and sealed the joint against rim joist with spray foam. As for termite damage, I would think the sill plate is not only more vulnerable but somewhat easier to access for inspection due to proximity to bottom of exterior siding.

I think the comment was meant more for a insulation to be placed on the banboard and he suggested the spray foam. So get R-13 16" width and cut to 12" and place at banboard between floor joist. Put full batts on the side banboards.