The panels can stay the same*, (A subpanel can always be larger than or equal to the supply to it) but if you don't change the setup to have (and perhaps you do have, but you are calling it a cutoff switch) a pair of 200A breakers from the meter box, you'll be limited to 200A total rather than 400A total.

Which may not be a problem, depending on your load calculation.

*I see a Sylvania sticker (not well stuck, though), but that house panel reminds me too much of "Stablok set-your-house on fire" panels - someone that knows those better can identify - if so, you want to replace before it manages the burn your house down trick.

Assuming you make it past the power company hurdle at all...

The panels can stay the same*, (A subpanel can always be larger than or equal to the supply to it) but if you don't change the setup to have (and perhaps you do have, but you are calling it a cutoff switch) a pair of 200A breakers from the meter box, you'll be limited to 200A total rather than 400A total. You might need to change to a class 320 meter with a pair of 200A breakers there, if both meters are class 200 (suitable for 250A since they are classed at continuous load - thus, the 320 is suitable for 400A) - discuss options with the power company.

200A total may not be a problem, depending on your load calculation.

*I see a Sylvania sticker (not well stuck, though), but that house panel reminds me too much of "Stablok set-your-house-on-fire" panels - someone that knows those better can identify - if so, you want to replace before it manages the burn your house down trick.