Terahertz reflective imaging is applied to characterize the failure modes in a polymer coating on a steel plate. The coating was initially scratched, then after accelerated aging, several types of failure have occurred. In order to resolve the thin coating (~50 μm), terahertz frequency-wavelet domain deconvolution is implemented. With the deconvolved signals, the temporally overlapping echoes of the incident, roughly single-cycle terahertz pulse are clearly resolved, and three important failure modes, viz. corrosion, delamination, and blistering, are characterized quantitatively. Terahertz images in three dimensions clearly exhibit the coating thickness distribution across the entire damaged coating, highlighting the terahertz features associated with different failure modes, thus demonstrating that terahertz imaging can be considered as an effective modality for characterizing damage mechanisms in polymer coatings on metals.