exterior insulation and finish systems (EIFS)

Typically, an EIFS system includes insulation board that is secured to the exterior wall surface with a specially formulated adhesive, a water-resistant base coat that is applied on top of the insulation, and a finish coat. Early versions of EIFS had issues with moisture getting trapped behind them leading to mold and wood rot. Despite improvements in these systems to reduce these risks, many insurers continue to aggressively underwrite this exposure and attach some form of EIFS exclusions to contractors' liability policies, especially those that work directly with EIFS. Contractors and their insurance professionals should carefully review the exclusion language to ensure the scope of the exclusion does not remove coverage for non-EIFS work on projects that contains an EFIS.