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Buildings insurance in New Zealand covers the structure of your home including walls, roof, floors, permanent fixtures, built-in appliances, and other permanent improvements. Coverage typically includes damage from fire, theft, storms, floods, and other insurable perils. It does not cover earthquakes (covered by EQC instead), nor does it cover contents like furniture and personal items (which require contents insurance). The exact coverage depends on your policy type and chosen optional extras.

Buildings insurance is not legally compulsory in New Zealand, but it is highly recommended and often required by mortgage lenders. If you have a mortgage, your lender will require you to maintain buildings insurance as a condition of the loan. Even if you own your home outright, buildings insurance is essential protection against catastrophic financial loss from fire, natural disasters, or other damage. Most NZ homeowners carry buildings insurance for this reason.

Sum insured is an agreed fixed amount that your insurer will pay out in the event of a total loss. Full replacement value (or indemnity) means your insurer will pay the actual cost to rebuild or repair your home to its pre-loss condition, up to the policy limit. Full replacement is generally more comprehensive but may have a higher premium. Sum insured is simpler to understand upfront but requires you to estimate the correct rebuild cost. Most modern policies offer full replacement cover, which is recommended for better protection.

Buildings insurance does not cover earthquake damage. In New Zealand, earthquake cover is provided by the Earthquake Commission (EQC/Toka Tu Ake), which is a state-owned enterprise that provides automatic cover for most residential buildings. EQC covers up to $300,000 + GST for homes under the cap. However, some insurers offer optional "earthquake cover" or "natural disaster" extensions that can provide additional coverage above the EQC limit. Check your policy to understand your earthquake protection.