Its really hard to update the UE4 Version of TSW since they're using a customized 4.16 Version. And some DLC would probably not work and would have to be fixed/optimised. Although im really hoping that they'll upgrade the Version since the newer Versions fix some of TSW graphical issues. But it probably wont happen anytime soon. :/
I'm sure this will happen at some point in the future but I very much doubt it's going to happen before the editor's fully released. Matt has said in the past that they keep an eye on new UE releases so it's not as though intend to stay on UE 4.16.3 forever.
Updating to a new version of UE, is similar to changing the foundation of a completed skyscraper. That’s the analogy that Matt uses.