Installing foam insulation panels on the exterior of your foundation is never mandatory, as long as the footing is below the frost line. However, this practice offers several important benefits, which is why it is often preferred for high-end homes. In addition to reducing your heating costs thanks to its insulating power, exterior foam insulation significantly reduces the risk of condensation on interior walls. The result: a drier, more comfortable basement that is better protected against moisture. In addition, this insulation strengthens the foundation's resistance to soil pressure and hydrostatic thrust, which helps limit the appearance of cracks and preserves the foundation's long-term durability.