Yes, water must be mixed with exhaust just after leaving exhaust manifold, water is injected in two locations to avoid unsafe heated objects in the bilge. If the exhaust cooling water injection is disrupted (clogged cooling line or device) water injection will be insufficient to keep exhaust components from becoming unsafely hot, rubber hoses and plastic exhaust parts will melt as well.
Also over the decades, rubber hoses will rot and delaminate due to hydrocarbon chemistry and the natural deterioration of rubber components, it's a pretty harsh environment thus water injection into the exhaust stream helps cool and keep things from becoming "unglued".