My house is an 80 year-old 3-story with a partially finished cinder block basement. I've owned it for about 10 years, and it came with a pair of french doors that opened from the dining room onto a large backyard deck, neither of which was original to the house (there used to be just a window in the dining room). Because they were old and sagging a little, I hired a contractor to replace the french doors with a glass slider. When he removed the doors, what he found was nothing short of a nightmare.
Long story short, whoever installed this deck did not put any flashing material between the deck and the house, so water has been getting trapped in between and slowly rotting the foundation framing along the back wall for at least 20 years he said. It was so bad that he had to remove about 4 feet of subfloor and replace 3 of the joists.
On the contractor's advice I demolished that deck, and sure enough, the water damage can clearly be seen all along the back wall of the house. There is a crack in the cinder block foundation that runs all the way down to the ground. There's no way water hasn't been getting in there.
The amount of damage is clearly much older than my residence here, and was not picked up by the inspector when we bought the place. Shockingly, there have been no indicators that this was happening. The dining room floor was not spongy at all. He verified that the top floor has not shifted or sagged, and there are no mysterious cracks upstairs As far as he could tell, the drywall in the basement looks and feels fine (although I shudder to think what I'll find if I remove it). I haven't noticed any musty smells when it rains. He said that if it were not for the sheer 1940's military grade over-engineering of this house, it would have collapsed. He might have been exaggerating, but it was really bad.
The contractor advised me against notifying my insurance company to even explore the feasibility of a claim. He says that they will likely deny it because it's an improper maintenance issue. They'll say the damage should have been noticed long ago and I failed to mitigate it. He also said that foundation damage is a huge red flag that will be a permanent part of this house's record and would cause my rates to significantly increase and might possibly make it harder to sell in the future. I tend to believe him, since he's done good work for me in the past and has always been straight with me. And the amount of damage is probably beyond his scope of work anyway.
Is the contractor correct? Is this something insurance would cover?