Which type of insulation can be used both below grade on the exterior and interior of foundation walls?

Polystyrene insulation is particularly suitable for use both below grade on the exterior and on the interior of foundation walls because of its moisture resistance and structural properties. When installed on the exterior, it acts as an effective barrier against water infiltration, helping to mitigate potential moisture problems that can lead to mold and deterioration. Its rigid foam panels provide thermal insulation and serve to stabilize the soil around the foundation.

On the interior side, polystyrene is also effective due to its ability to resist moisture and provide a good thermal break. This versatility makes it especially valuable in multifamily buildings where various insulation needs must be met effectively depending on location and environmental conditions.

In contrast, fiberglass insulation can absorb moisture, leading to mold issues if used in below-grade applications. Cellulose is not suitable for the exterior as it can hold moisture, and while spray foam can offer good insulation, its application can be challenging in below-grade situations due to potential moisture issues and the need for proper sealing. Polystyrene's unique properties make it the best choice for the scenarios described in the question.