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It's okay to live in a house with asbestos siding as long as it's intact. Asbestos siding in good condition poses minimal risk since the fibers remain bound. If the siding is damaged, or deteriorating, or if renovations are planned that may disturb it, the risk of exposure increases significantly. Consult a professional asbestos inspector to assess the situation and provide recommendations.

You can cover asbestos siding with another type of siding, such as vinyl, however, this may not be the best option. Covering the asbestos siding may disturb it, releasing fibers into the air. The covered siding can also be disturbed at a later date, such as by a new homeowner who is unaware of its presence.

If you decide to cover the siding, be sure to work with a professional and follow any local building codes and requirements. It may be the case that removing the asbestos siding is the better option, rather than covering it over. 

You are not really supposed to seal asbestos with paint, but in theory it could work—the caveat being that this is extremely dangerous and should be avoided at all costs. The only real way to seal asbestos is with the professional application of an encapsulating material like epoxy. Due to the negative effect asbestos can have on your home, however, it is usually the best course of action to accept a costly fix and remove the material entirely.

In the 1980s, the use of asbestos in house siding materials underwent a significant decline, ultimately being phased out by the mid-1980s to early 1990s. This change was largely due to a growing awareness of the severe health risks associated with asbestos exposure, particularly its link to lung diseases and cancers. With increased public concern and regulatory agency involvement, building codes and regulations were updated to restrict the use of asbestos in construction materials.