Microsoft has released Servicing stack update (KB5004378) for Windows 7 Operating System on July 2021 to address several issues and it also updates Windows Module Installer. Recently Windows 7 users were facing this error while installing recent patches released by Microsoft to address the PrintNightmare vulnerability.
Error: The Windows Modules Installer must be updated before you can install this package. Please update the Windows Modules Installer on the computer, then retry Setup. 0x800f0823.
Download and install this package to update Windows Modules Installer a.k.a TrustedInstaller.