Water funnels ?
Built to leak.
Some buildings have water funnels built in by design.
This stucco has been patched umpteen times over the years, and it still needs to be patched.
The problem here is that water is getting in the first and second story windows, and deteriorating the plaster.
A simple kick-out flashing diverting water into the gutter would avoid this problem forever. Maybe we'll fix it one day.
The point I am making here is that the water funnel is both the cause of the inside leak and the stucco failing, and that the stucco failing isn't the cause of the water inside. Water doesn't travel horizontally through a solid object and come out the other side.
A common water funnel is that the stucco protrudes past the step flashing on roof lines.
This can be corrected by a kickout flashing.
Please check out the pictures I got below.
The insurance adjuster felt water was getting in the cracks in the stucco, causing rot.
The cracks aren't causing the rot on the inside. They got mad at me-ee-ee when I suggested that the water was getting in the roof, causing both the rot inside and water damage to the stucco on the outside.
The point I am making is that water runs downhill. The insurance adjuster claimed that the rot on the inside was caused by the stucco cracking on the outside, and I pointed out he was mistaken, that the obvious leak on the roof was causing both problems.