[Christ]

Only when you allow it to get wet. And that applies to the actual exhaust header wrap, originally made from asbestos, now partially made from fiberglass and other substrates. It soaks up water from the humid air around it, and the water begets corrosion as the tubes cool. It's not too hard to insulate in a way that doesn't allow the moisture in, and if you're replacing the exhaust (for whatever reason) you can exchange with either aluminum pipe or stainless pipe, and use hi-temp paint on the exhaust before insulating it, and it won't rot any more quickly than normal exhausts do.