Yes, resetting your Apple Watch will erase all content and settings, returning it to factory conditions. Make sure to back up your data before proceeding.
You can reset your Apple Watch directly from the watch itself, which effectively unpairs it from the iPhone. However, without the iPhone, you won't have the latest backup.
What happens to my cellular plan when I unpair my Apple Watch?
You can choose to keep or remove your cellular plan during the unpairing process. If you plan to pair the watch again with the same iPhone or a new one, it's best to keep the plan.
To pair your Apple Watch with a new iPhone, unpair it from the current iPhone first, then follow the setup instructions on the new iPhone, choosing to restore from a backup if desired.