Does Homeowners Insurance Cover a Crumbling Foundation in Connecticut? Pyrrhotite, CFSIC, and Your Policy

Short answer: Usually not. In 2019 the Connecticut Supreme Court ruled in a set of cases that homeowners policies did not cover pyrrhotite foundation deterioration unless the home was in imminent danger of collapse. The main source of help is the Connecticut Foundation Solutions Indemnity Company (CFSIC), a state-created program funded partly by a $12 annual assessment on Connecticut homeowners policies. CFSIC raised its maximum to $205,000 per house and $82,000 per condo unit for proposals submitted on or after 20 January 2026.

What is the crumbling foundation problem?

Concrete poured in parts of north-central and eastern Connecticut, roughly between the early 1980s and 2015, contained aggregate with the mineral pyrrhotite. When pyrrhotite is exposed to water and oxygen it oxidizes and expands, causing map-pattern cracking and, over years, structural failure. State officials have estimated that tens of thousands of homes, most frequently cited as around 35,000, may have been built with the affected material. Towns in Tolland, Windham and Hartford counties have been the most affected, though the concrete was trucked well beyond them.

Why doesn't homeowners insurance pay?

Homeowners policies cover sudden and accidental physical loss. They generally exclude wear and tear, deterioration, cracking, settling and defects in materials. Many homeowners argued that their foundations were in a state of "collapse," which some older policies covered. In November 2019 the Connecticut Supreme Court decided several such cases in favor of the insurers, holding that coverage for collapse required the home to be in imminent danger of falling down, which typical pyrrhotite damage is not. Coverage disputes still arise, and policy wording matters, but owners should not plan on their homeowners policy to fund a foundation replacement.

Can my insurer drop me because of pyrrhotite?

The Connecticut Insurance Department has warned insurers that state law prohibits canceling or non-renewing a policy, or raising premiums, because a homeowner made a claim or an inquiry, including inquiries about crumbling foundations. If you receive a non-renewal you believe is related, ask for the specific reason in writing and contact the Department's Consumer Affairs Division. Our guide to non-renewal in Connecticut explains the timeline.

How does CFSIC help?

• Who: owners of residential buildings with foundations that test positive for pyrrhotite or show the characteristic damage, under CFSIC's eligibility rules. Homes purchased after 1 February 2019 generally need to have been tested or visually examined before the sale.
• How much: according to CFSIC's 2026 guidance, up to $205,000 per stand-alone home and $82,000 per condominium unit for proposals first submitted on or after 20 January 2026. Confirm current figures directly with CFSIC before relying on them.
• Testing: core testing costs can be partly reimbursed through the Capitol Region Council of Governments (CRCOG) testing program.
• Gaps: a separate federally funded program has helped income-eligible households cover costs above the CFSIC payment. Eligibility and funding change, so check before you budget.

What should buyers and owners do?

• Buyers: for any home built in the affected window in central or eastern Connecticut, make foundation testing a contingency, not an afterthought.
• Owners with cracking: document it, get a qualified test, and contact CFSIC before signing a replacement contract.
• During replacement: the house is lifted or the basement is open for weeks. Tell your insurer, confirm your policy stays in force during the work, and make sure the contractor carries liability and workers' compensation. Our renovation insurance guide covers the details.

New England Insurance, an independent agency in Bridgeport serving Connecticut since 2012, can review your homeowners policy before, during and after a foundation project. Contact us or see Connecticut home insurance.