Written by Andy Gurczak

August 27, 2023

Stucco Damage: Does Homeowner Insurance Cover It?

Home builders and contractors have been improperly installing stucco on homes for decades. And as a result, stucco eventually cracks and further causes water damage. For this reason, homeowners often want to know if their homeowner’s insurance offers stucco insurance. However, the answer to this question isn’t so simple, since it strongly depends on the circumstances of stucco damage.

What is Stucco

Stucco has been used in building construction for thousands of years all through the Mediterranean, the Middle East, Southeast Asia and America. It was a form of plaster made from lime, sand, and water, which was applied wet and then hardened. Believe it or not stucco has a lengthy history. For example, in ancient Rome and Greece, it was primarily used for decorative purposes. In fact, Greeks and Romans even used it for creating sculptures.

Later on, during the late 19th and early 20th centuries, it was generally favored by the upper classes. It was also used for decorating walls because of its “aristocratic” look. However, stucco fell out of favor during the 1920s, although its use continued well into the 1950s. Nowadays, stucco is primarily used for exteriors and it’s made of Portland cement, sand and water because it hardens quicker. In addition, some manufacturers and contractors add ingredients such as fibers and acrylics in order to make the material stronger and more flexible.

Stucco Damage Wall

How Does Stucco Help?

If it’s well done, once it hardens, stucco offers excellent protection from damage due to moisture. On the other hand, if the contractor fails to mix the stucco properly, or fails to follow the correct procedure, it can mean disaster for the homeowner. Moisture can seep in through cracked stucco and destroy the structure underneath. For example, it can cause wood to rot away and weaken the structure of your home. The problem with stucco damage is that more often than not, this damage can occur for years without you ever becoming aware of the problem. By the time you realize there is an issue, your home environment could have become a safety hazard.

This is what has happened in dozens of cases in wetter regions of the country, where errors during construction allowed water to penetrate the surface. As a result, the cost to repair can be very expensive. And not to mention that trying to get the contractor to admit that it was their fault and redo their work can be a hassle.

Many claimants have stated that their homes and buildings have experienced one or more of the following types of stucco damage:

  • First, humidity in the home increases, causing illness or damage to personal effects;
  • Second, noticeable insect infestations start to ruin the walls, especially termites;
  • Also black mold begins to form, causing inhalable spores which can cause lasting health defects;
  • Last but not least, rotting wood from prolonged exposure to the elements makes the building unsafe and, in many instances, unable to sell.

Stucco Damage Cracks

Why Does Stucco Damage Occur?

When stucco dries, it shrinks, and as a result, microcracks can occur. Therefore making the finish relatively porous. Moreover, control joints are usually installed to mitigate excessive cracking. Meanwhile lattices and corner beads are commonly used to bind stucco around windows and corners. However, these joints and beads are usually open in the back and consequently can allow water to seep behind the stucco. Homebuilders that are aware of the microcracking problem, might try to use stucco mixtures with additives that are claimed to create a better barrier to moisture. Yet a study by the American Institute of Architects and the National Institute of Building Sciences found that this and other construction techniques to be ineffective at preventing damage and potential health issues. Therefore the best way to prevent stucco damage is making sure the job is done correctly.

Furthermore, according to a case study of homes in Florida by the same organization, stucco is frequently applied directly over concrete block wall construction, measuring only in quarter-inch or less. Building codes specifically state that the thickness should be around five-eighths and three-quarters of an inch. Moreover, exterior stucco normally requires reinforcement or some type of lath for support. However, this wasn’t the case in numerous instances.

Who Is at Fault for Stucco Damage?

Generally, the party at fault is the homebuilder who improperly installed the stucco. Recently, some popular home builders have gotten into trouble with the courts for low-grade stucco installation practices. For example, Toll Brothers, K.B. Homes, D.R. Horton, and other large homebuilders have all been ordered by the court to pay for restitution. Toll Brothers alone estimates its liabilities at nearly $450 million.

Has Your Home Experienced Stucco Damage? If So, What Can You Do?

As we mentioned before, stucco damage usually isn’t apparent until it’s very advanced or it comes to light in the course of a professional inspection. By then, the homeowner may be already facing repair and rehabilitation costs in the hundreds of thousands of dollars. The stucco removal is necessary and in most cases, the entire substrate needs replacement.

Most states have a Statute of Repose with a delimited timeline. For this reason it’s important you have your stucco professionally inspected before this deadline. To illustrate, in Florida, a building’s stucco inspection should be within nine years of occupancy, since the statute of repose has a ten year limit from the time the owner actually takes possession of the property. In the case of condominiums, the statute of repose runs four years from the time of the election of a new board.

Do Homeowners Insurance Offer Stucco Damage Insurance Coverage?

There is no simple answer to this question, since it depends on many factors.The first factor is the kind of stucco damage. For instance, insurance covers water damage if it is the result of poor installation, but the conditions branch out from there. To further illustrate, if your home uses an Exterior Insulation and Finish System (EIFS) it is usually not covered by homeowners insurance. This is because it’s a kind of synthetic stucco. Moreover, you need to have the EIFS stucco installed by a certified and licensed professional. Therefore if you didn’t use a licensed professional, trained in stucco application, you cannot make a claim.

In conclusion, homeowners insurance cover many stucco-related cases on the basis that you find the problem with stucco during an inspection of the home when you go to purchase it or shortly after having the stucco installed by a licensed professional. In the end, whether your insurance provider will allow you to make a claim falls to two considerations: who was the professional who installed the stucco and can that professional be held liable?

Builder’s Insurance May Cover Stucco Damage

As we said before, sometimes, a home insurance plan won’t cover stucco-related problems because it actually falls on the responsibility of a builder or contractor. These workers usually have insurance too, and many claims for faulty work rest on their insurance company’s shoulders. In fact, your homeowners insurance carrier may be able to help you receive compensation from the contractor’s insurance company. And even help you assess if you have a claim. Public adjusters are also a huge help when dealing with stucco insurance claims or stucco related damage. Furthermore, attorneys will also assist you in litigating against builder insurance companies in order to get you compensation from the liable parties.

Stucco Damage Insurance

Stucco Damage Insurance

Although stucco may look pretty and can actually help a house run more efficiently, incorrect installation can end up costing more than bargained for. For this reason, you should consult your insurance policy in order to fully understand if you have stucco insurance coverage. If you have any questions or doubts feel free to ask your insurance agent, preferably before any problems even happen.

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