Home insurance (also called building insurance or house insurance) covers the cost of repairing or rebuilding your home if it’s damaged or destroyed. In New Zealand, it interacts with the government’s Earthquake Commission (EQC/Toka Tū Ake) for natural disaster cover.
What Home Insurance Covers
A standard NZ home insurance policy covers damage from:
- Fire and smoke
- Storm and wind damage
- Flood (check your specific policy — some exclude flood)
- Burst pipes and water damage
- Earthquake, tsunami, volcanic eruption (in conjunction with EQC — see below)
- Lightning strike
- Subsidence (check policy — some exclude this)
- Malicious damage and vandalism
- Vehicle impact (a car hitting your fence or wall)
- Accidental damage (on broader policies)
What Home Insurance Does NOT Cover
- Gradual deterioration and maintenance issues — leaky roofs, rot, mould from deferred maintenance
- Wear and tear — normal ageing of materials
- Pre-existing damage — damage that existed before the policy started
- Unoccupied homes (more than 60 days unoccupied typically voids cover or reduces it)
- Business use — if you run a business from home, check your policy
- Landslip — some insurers exclude or limit landslip cover (check your specific policy)
How Sum Insured Works
Most NZ home insurance policies use a sum insured model — you choose the maximum amount the insurer will pay to rebuild your home. This is different from “replacement value” policies that pay whatever it costs.
Getting your sum insured wrong is one of the most common mistakes NZ homeowners make.
The sum insured should reflect the cost to rebuild your home from scratch — including:
- Demolition and debris removal
- Foundations
- Construction costs (current — not historical or market value)
- Professional fees (architect, engineer)
- Council consent costs
Do not confuse market value with rebuild cost. A house worth $1.2 million in Auckland may cost $600,000–$800,000 to rebuild. Insuring it for $1.2 million wastes money; insuring for $400,000 leaves you severely underinsured.
Tools for estimating rebuild cost:
- Cordell Sum Sure calculator (free, used by many NZ insurers)
- Your insurer’s own rebuild cost calculator
- Quantity surveyor assessment (most accurate for high-value or unusual homes)
EQC and Natural Disaster Cover
New Zealand’s Earthquake Commission (EQC / Toka Tū Ake) provides the first layer of natural disaster cover for your home — but only if you have a private home insurance policy.
EQC covers:
- Earthquake, tsunami, volcanic eruption, landslip caused by natural disaster, hydrothermal activity, storm, and flood
- Up to $300,000 (plus GST) for your home structure
- EQC is funded by a levy included in your home insurance premium
Your private insurer covers:
- Damage exceeding EQC’s $300,000 limit
- Other insured events (fire, burst pipes, etc.) — EQC doesn’t cover these
For most standard NZ homes, EQC’s $300,000 limit covers a significant portion of earthquake risk. For higher-value homes, the gap between EQC’s cap and your sum insured is covered by your private insurer.
See the full EQC Guide NZ for detail on how the scheme works.
How Much Does Home Insurance Cost?
Home insurance costs in NZ vary based on:
- Location (earthquake zone, flood risk, fire risk)
- Construction type (brick vs weatherboard vs concrete)
- Age of the home
- Sum insured
- Security features
- Claims history
See our home insurance cost guide for indicative premium ranges and how to keep costs down.
Key Things to Check in Your Policy
Before buying or renewing:
- Is flood covered? Some policies exclude flood, or only cover “sudden and accidental” water ingress.
- What’s your excess? The amount you pay per claim. Higher excess = lower premium, but you pay more when you claim.
- Is landslip covered? Some insurers limit or exclude landslip, particularly on steep-section properties.
- What’s the unoccupancy clause? Most policies limit cover if the home is unoccupied for more than 30–60 days.
- Is accidental damage included? Standard policies may not cover accidental damage to the structure — you may need to add this.
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