Wellington House Insurance Risks, Costs and Policy Comparison - Protecting Your Home in New Zealand's Largest City
Our guide to Wellington house insurance examines policies and costs, suburb-specific risks, natural disaster statistics, area replacement versus sum insured, and how to safeguard your property. We have made our guide essential reading for all homeowners in Wellington.
Updated 29 October 2025
Summary
Whether you own a house in Wellington, this guide is designed to help you understand your real risks and how to protect your most valuable asset. Our guide covers:
Know This First - House Insurance is Getting More Expensive and Harder to Obtain
Consumer's 2025 report into house insurance, which is free to download and read, is arguably the most in-depth research into home insurance costs available. It saw contributions from the Wellington City Council, Natural Hazards Commission and insurance bodies, with extensive findings, including:
- Wellington homeowners face unique insurance challenges, and policy costs vary significantly across insurers.
- Wellington isn't like the rest of New Zealand when it comes to house insurance - the city sits directly on major fault lines, properties are often built on steep, unstable hillsides, and the combination of earthquakes, landslips and severe weather events makes the insurance risk profile increasingly complex.
- Wellington has always been known for its seismic risk, with the Wellington Fault running right through the region and memories of the 2016 Kaikōura earthquake still fresh. Significant flooding events and landslides further highlighted the city's vulnerability in recent years.
- Add in steep terrain, coastal erosion from storm surges, ageing infrastructure struggling with extreme weather, and general climate change impacts, and it's clear Wellington homeowners face a unique set of challenges and high costs when insuring their home.
- Our research is focused on cutting through the confusion to give Wellington homeowners what's needed - suburb-specific risk assessments and strategies to ensure homeowners are genuinely protected when the next "once in a 100 years" event arrives (which lately seems to happen every few years).
Whether you own a house in Wellington, this guide is designed to help you understand your real risks and how to protect your most valuable asset. Our guide covers:
- The Major Must-Know Risks for Wellington Properties and the Impact of Climate Change
- Understanding the Factors Driving Wellington's Higher Insurance Costs
- Wellington House Insurance Coverage Options - Area Replacement vs Sum Insured
- Compare Wellington House Insurance Costs by Insurer - AA Insurance vs AMP vs AMI vs Initio vs MAS vs Tower vs State vs TradeMe
- Suburb-by-Suburb Risk Analysis
- The Bottom Line for Wellington Homeowners Looking for Robust and Affordable House Insurance
- Frequently Asked Questions
Know This First - House Insurance is Getting More Expensive and Harder to Obtain
Consumer's 2025 report into house insurance, which is free to download and read, is arguably the most in-depth research into home insurance costs available. It saw contributions from the Wellington City Council, Natural Hazards Commission and insurance bodies, with extensive findings, including:
- House insurance costs have skyrocketed 916% since 2000 - the highest increase of any product tracked by New Zealand's Consumer Price Index over 25 years, massively outpacing inflation.
- By 2035, many New Zealanders may struggle to obtain home insurance due to climate change risks, as insurers are already retreating from high-risk areas globally and much of New Zealand's risk is re-insured overseas.
- Up to 700,000 people and 411,516 buildings in New Zealand are at risk of river flooding, with an additional 72,000 people exposed to severe coastal flooding.
- 85% of New Zealand homes could be underinsured by an average of 28%, creating a potential insurance gap of $184 billion (now $242 billion) that could devastate families after disasters.
- In 2023 alone, extreme weather events cost insurers $3.8 billion - eclipsing all previous records and directly driving premium increases across the country.
- Australian-owned insurers IAG and Suncorp control 92% of NZ's insurance market with insurers such as State, AMI and AA Insurance (part-owned by Suncorp), and appear to make higher profit margins here than in Australia.
- The cost of insurance has become the fourth biggest financial concern for New Zealanders, behind only housing, food, and household debt, with 17% dropping house insurance due to the cost.
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MoneyHub Founder and Head of Research Christopher Walsh Explains Why House Insurance is Too Important to Get Wrong:
"House insurance is highly property-specific, and we strongly encourage you to verify all details independently to ensure you select the best policy for your needs. Both sum insured and area replacement policies have unique benefits and risks. We suggest obtaining quotes for both options from multiple insurers to make an informed decision. Before buying any insurance policy, always review the policy documents, check your property's specific risks (e.g., flood zones, coastal erosion, or landslip potential) and make sure you understand the cover you're buying. Underestimating rebuild costs or skipping annual reviews can lead to significant financial exposure. While this guide highlights the benefits of area replacement for its ability to mitigate rebuild cost risks, we recognise that sum insured policies can be a viable and cost-effective option for many homeowners. It's essential to make sure your sum insured is accurate and regularly updated". |
Christopher Walsh
MoneyHub Founder and Head of Research |
The Major Must-Know Risks for Wellington Properties and the Impact of Climate Change
Wellington Regional Council hazard maps and media stories only give you a limited appreciation of the significant issues that homeowners across the Wellington region can face. We outline the major risk areas to help you understand it's essential to buy the most appropriate insurance for your home.
1. Earthquakes and Seismic Activity
Wellington's earthquake risk is unmatched in New Zealand. The city sits directly on the Wellington Fault, with the Wairarapa Fault and subduction zone nearby. It's not just about the "big one" - frequent smaller quakes cause ongoing damage. High-risk factors include:
Our View: A significant problem is that many Wellington homes were built before modern seismic standards. Each moderate shake further weakens structures, creating cumulative damage that may not be immediately visible.
2. Landslips (Wellington's steep terrain meets extreme weather)
Wellington's steep hillsides and frequent heavy rain create perfect landslip conditions. The numerous 2017 slips and 2022 events showed entire sections sliding away. High-risk areas include:
Our View: Unlike gradual erosion, Wellington's landslips can be sudden and catastrophic, taking out multiple properties at once.
3. Flooding and Surface Water
Wellington's flooding isn't just coastal - it's about overwhelmed stormwater systems and steep terrain channelling water. Problem areas include:
Our View: It's commonly accepted that Wellington's aging infrastructure, designed for 1950s rainfall, can't cope with climate change-driven deluges. Water races down hillsides, overwhelming drains and flooding properties that never flooded before.
4. Wind Damage - The World's Windiest City (as per Guardian research)
Wellington's wind can be destructive. Issues include:
Our View: The city's topography funnels and accelerates wind, creating microclimates where speeds can be 50% higher than forecast.
5. Coastal Erosion and Storm Surge
From Lyall Bay to Makara, Wellington's coastline faces accelerating erosion and storm-surge risk. The south coast is particularly vulnerable. At-risk areas include:
Our View: Properties face both immediate storm damage and long-term insurance retreat as coastal hazards increase.
1. Earthquakes and Seismic Activity
Wellington's earthquake risk is unmatched in New Zealand. The city sits directly on the Wellington Fault, with the Wairarapa Fault and subduction zone nearby. It's not just about the "big one" - frequent smaller quakes cause ongoing damage. High-risk factors include:
- Properties on reclaimed land (CBD, Rongotai, Miramar)
- Unreinforced masonry buildings in older suburbs
- Hillside properties are vulnerable to earthquake-triggered landslips
- Liquefaction zones in Evans Bay, Lyall Bay, and Porirua
Our View: A significant problem is that many Wellington homes were built before modern seismic standards. Each moderate shake further weakens structures, creating cumulative damage that may not be immediately visible.
2. Landslips (Wellington's steep terrain meets extreme weather)
Wellington's steep hillsides and frequent heavy rain create perfect landslip conditions. The numerous 2017 slips and 2022 events showed entire sections sliding away. High-risk areas include:
- Northland, Wilton, and Wadestown
- Brooklyn and Vogeltown hillsides
- Karori and Khandallah slopes
- Any property above or below steep banks
- Oriental Bay and Mount Victoria scarps
Our View: Unlike gradual erosion, Wellington's landslips can be sudden and catastrophic, taking out multiple properties at once.
3. Flooding and Surface Water
Wellington's flooding isn't just coastal - it's about overwhelmed stormwater systems and steep terrain channelling water. Problem areas include:
- Kilbirnie and Rongotai (low-lying, poor drainage)
- Tawa and Porirua valleys
- Newtown and Island Bay hollows
- Petone and Lower Hutt floodplains
Our View: It's commonly accepted that Wellington's aging infrastructure, designed for 1950s rainfall, can't cope with climate change-driven deluges. Water races down hillsides, overwhelming drains and flooding properties that never flooded before.
4. Wind Damage - The World's Windiest City (as per Guardian research)
Wellington's wind can be destructive. Issues include:
- Roofs lifting in exposed suburbs like Karori and Brooklyn
- Windows blown in along the south coast
- Trees toppling in established suburbs
- Secondary damage from flying debris
Our View: The city's topography funnels and accelerates wind, creating microclimates where speeds can be 50% higher than forecast.
5. Coastal Erosion and Storm Surge
From Lyall Bay to Makara, Wellington's coastline faces accelerating erosion and storm-surge risk. The south coast is particularly vulnerable. At-risk areas include:
- Breaker Bay and Lyall Bay beachfronts
- Owhiro Bay and Island Bay coastal properties
- Eastern Bays from Eastbourne to Wainuiomata
- Makara and south Miramar clifftops
Our View: Properties face both immediate storm damage and long-term insurance retreat as coastal hazards increase.
Understanding the Factors Driving Wellington's Higher Insurance Costs
Wellington's building costs are increasing based on cost data filed by builders with the Wellington Council. This is due to many reasons:
However, after any natural disaster, these costs spike 40% or more as demand overwhelms supply, as evidenced by recent examples explained in our Natural Disaster Home Insurance guide.
Our View: Wellington is likely to face a builder shortage whenever a rebuild is needed after floods or storms, and wait times can blow out to 18+ months. Builders then can charge premium rates, and desperate homeowners pay them, even if their sum insured is insufficient to cover the costs. Our guide to sum insured vs area replacement explains how each option insures for rebuild costs.
- Earthquake strengthening requirements
- Steep site access challenges
- Seismic-rated material costs
- Complex geotechnical requirements
- Wind-resistant construction standards
However, after any natural disaster, these costs spike 40% or more as demand overwhelms supply, as evidenced by recent examples explained in our Natural Disaster Home Insurance guide.
Our View: Wellington is likely to face a builder shortage whenever a rebuild is needed after floods or storms, and wait times can blow out to 18+ months. Builders then can charge premium rates, and desperate homeowners pay them, even if their sum insured is insufficient to cover the costs. Our guide to sum insured vs area replacement explains how each option insures for rebuild costs.
Suburb-Specific Considerations - Our View of Wellington Right Now
There is a lot of data, and our summary below is subjective and not intended as insurance advice. What's important is that homeowners gather as many quotes as possible to get the best policy at an affordable price - comparing insurer by insurer is the only way to do this, but it’s also essential to understand the difference of cover offered by sum insured vs area replacement cover.
High-Risk Zones include:
Medium-Risk Zones include:
Lower-Risk Zones include:
High-Risk Zones include:
- Earthquake/liquefaction zones: Rongotai, Miramar Peninsula, Evans Bay, Porirua Basin
- Landslip-prone: Northland, Wadestown, Brooklyn hillsides, Karori slopes
- Coastal erosion: Breaker Bay, Lyall Bay, Owhiro Bay, Eastern Bays
- Flood-prone: Kilbirnie, Tawa Valley, Porirua East, Petone
Medium-Risk Zones include:
- Older hillside suburbs with retaining wall issues
- Properties on reclaimed land outside main liquefaction zones
- Areas exposed to extreme wind (Karori, Newlands, Brooklyn)
- Properties below or above moderate slopes
Lower-Risk Zones include:
- Stable elevated areas: Khandallah ridges, Upper Kelburn
- Well-drained newer developments: Churton Park, Grenada North
- Sheltered valleys with modern infrastructure: Whitby, parts of Johnsonville
- Bedrock suburbs away from fault lines
Wellington House Insurance Coverage Options - Area Replacement vs Sum Insured
Option 1: Sum Insured: The Standard (Risky) Option
Most Wellington homeowners have sum insured policies. You calculate an estimate of replacement costs using a house insurance calculator - say $800,000 - and hope it's enough. However, problems can arise - which we outline below:
1) Wellington Home Owners Consistently Underestimate
2) Online Calculators Don't Work Perfectly for Wellington
This is because generic calculators can't account for:
The Post-Disaster Spike. Your $800,000 sum insured assumes normal market conditions. After floods, when everyone needs builders:
Suddenly, your $800,000 sum insured buys you $550,000 worth of building costs during 'surge' periods after a natural disaster, etc.
Option 2: Area Replacement: Arguably Appealing to Wellington Homeowners
Area replacement works differently - your coverage is based on floor area (say 200 square meters) multiplied by current rebuild costs. When disaster strikes and costs spike, you’re paid the reasonable costs to rebuild your home, like for like.
Why it Matters More in Wellington
Most Wellington homeowners have sum insured policies. You calculate an estimate of replacement costs using a house insurance calculator - say $800,000 - and hope it's enough. However, problems can arise - which we outline below:
1) Wellington Home Owners Consistently Underestimate
- Average underinsurance: We estimate this to be at least 30-40% of homes currently using sum insured
- Character homes: We estimate there may be at least 50% of homes underinsured
- Our View: If you haven't updated your sum insured in 3+ years, you're almost certainly short
2) Online Calculators Don't Work Perfectly for Wellington
This is because generic calculators can't account for:
- Heritage features
- Coastal construction requirements
- Access issues on steep sites
- Wellington's unique compliance costs
The Post-Disaster Spike. Your $800,000 sum insured assumes normal market conditions. After floods, when everyone needs builders:
- Labour costs jump 30-50%
- Materials become scarce
- Wait times mean storage costs
- Compliance requirements increase
Suddenly, your $800,000 sum insured buys you $550,000 worth of building costs during 'surge' periods after a natural disaster, etc.
Option 2: Area Replacement: Arguably Appealing to Wellington Homeowners
Area replacement works differently - your coverage is based on floor area (say 200 square meters) multiplied by current rebuild costs. When disaster strikes and costs spike, you’re paid the reasonable costs to rebuild your home, like for like.
Why it Matters More in Wellington
- Some of the highest rebuild cost volatility in New Zealand
- Concentrated population, meaning any damaged area will affect multiple homes that all need urgent fixing, a situation where Area Replacement can be more valuable.
- Complex properties can be hard to value - Area Replacement sorts this issue out.
Compare Wellington House Insurance Costs by Insurer - AA Insurance vs AMP vs AMI vs Initio vs MAS vs Tower vs State vs TradeMe
- Well known insurers such as AA Insurance , AMP, AMI, Initio, MAS, Tower, State and TradeMe all sell house insurance.
- Each policy referenced below is "home only", no contents are included. The quotes are for a single-story, brick and tile roof property with a sum insured value of $700,000.
- We don't cover area replacement, as only MAS offers this, but suggest getting a quick MAS estimate and/or full quote for comparison.
- We obtained quotes for nine properties in locations all over New Zealand.
- We've compared house insurance policies side-by-side to make it easier to see where you're covered, and where you're not. Download our policy comparison table in XLS (Google Sheets).
Property specifics:
- Owner-occupied
- Policy holder age = 41 years
- Free standing home, concrete slab foundations, built 1980
- Flat/gentle slope of land
- 1 Story
- Standard construction
- No previous claims in the last three years
- Double brick exterior with terracotta tiles
- Floor area of 180 metres squared
- Standard security with a monitored burglar alarm
- Four bedroom, one bathroom, one deck, one kitchen and a two car garage
Quotes Obtained in April 2025
Wellington Online Quotes - What You Need to Know
Most insurers make Wellington homeowners call for quotes - frustrating but reality. We suggest these insurers as a starting point:
If you start with these two insurers online to get baseline figures, you can then get other quotes as you expand your search. Getting multiple quotes is essential as Wellington premiums vary wildly between insurers.
Most insurers make Wellington homeowners call for quotes - frustrating but reality. We suggest these insurers as a starting point:
- MAS - Offers estimates directly and a full quote for Wellington properties
- Initio - Online quotes available
If you start with these two insurers online to get baseline figures, you can then get other quotes as you expand your search. Getting multiple quotes is essential as Wellington premiums vary wildly between insurers.
Summary
Compare Policy Details
- Useful resource: We've compared house insurance policies side-by-side to make it easier to see where you're covered, and where you're not. Download our policy comparison table in XLS (Google Sheets).
- Why MAS Pricing Isn't Included: MAS offers area replacement policies, which are priced based on your property's floor area and rebuild costs, unlike sum insured policies that use a fixed dollar amount. Because rebuild costs vary significantly by property size, location, and construction type (e.g., heritage features, coastal specifications), providing generalised pricing for MAS would be misleading. For accurate pricing, we suggest getting a quick estimate with MAS estimate directly or a full quote, as well as other insurers like Tower and Initio, to compare coverage and costs specific to your property.
- For Sum Insured Options: Tower and Initio consistently deliver the best combination of price and comprehensive benefits. Both offer excellent coverage within the sum insured model - just remember you're still carrying the rebuild cost risk.
Compare Policy Details
- We've compared house insurance policies side-by-side to make it easier to see where you're covered, and where you're not. Download our policy comparison table in XLS (Google Sheets).
- Disclaimer: This policy comparison is not intended to be financial or insurance advice. It is a summary of the various policy terms of coverage only. For full details of policy coverage, terms, benefits and exclusions please refer to the specific policy wording document.
Compare House Insurance Quotes With Our Three Trusted Insurers - MAS, Tower and Initio - Different Coverage, Different Risks
The Uncomfortable Truth: Many New Zealand homeowners have sum insured and are unknowingly carrying a six-figure liability. They're saving $20-$30/month but risk losing $200,000+ if disaster strikes and building costs spike further which means their sum insured estimate is too low. Our guide to Area Replacement vs Sum Insured explains more.
MoneyHub's Position: After Christchurch showed us 40% building cost spikes, and with climate events becoming routine, area replacement isn't "premium" insurance - it's actual insurance. Sum insured makes you the insurer of last resort, and while area replacement may cost 10-20% more, we believe that insurance that leaves you $200,000 short isn't good value at any price.
The cheapest insurance can be expensive if it doesn't cover the cost of rebuilding. The best insurance - the kind that actually protects your biggest asset - is worth every cent.
Compare all three today - the 3-6 minutes it takes could save you $200,000 tomorrow - visit MAS, Tower and Initio to see live quotes from trusted insurers.
- Get a MAS Area Replacement Estimate (1-2 Minutes): Pays full rebuild costs even if they spike 40% after disaster
- Get a Tower Sum Insured Quote (1-2 Minutes): Market-leading benefits but you pay any gap over your sum insured estimate
- Get an Initio Sum Insured Quote (1-2 Minutes): Instant quotes for difficult properties but capped at your sum insured amount
The Uncomfortable Truth: Many New Zealand homeowners have sum insured and are unknowingly carrying a six-figure liability. They're saving $20-$30/month but risk losing $200,000+ if disaster strikes and building costs spike further which means their sum insured estimate is too low. Our guide to Area Replacement vs Sum Insured explains more.
MoneyHub's Position: After Christchurch showed us 40% building cost spikes, and with climate events becoming routine, area replacement isn't "premium" insurance - it's actual insurance. Sum insured makes you the insurer of last resort, and while area replacement may cost 10-20% more, we believe that insurance that leaves you $200,000 short isn't good value at any price.
The cheapest insurance can be expensive if it doesn't cover the cost of rebuilding. The best insurance - the kind that actually protects your biggest asset - is worth every cent.
Compare all three today - the 3-6 minutes it takes could save you $200,000 tomorrow - visit MAS, Tower and Initio to see live quotes from trusted insurers.
Suburb-by-Suburb Risk Analysis
We've analysed Wellington's suburbs to help you understand your property's specific risks and insurance implications. This isn't generic advice - it's based on actual claims data and rebuild experiences across the region.
1) Central Wellington
Mount Victoria/Thorndon
Wellington CBD Apartments
Oriental Bay/Roseneath
2) Northern Suburbs
Johnsonville/Newlands
Khandallah/Ngaio
Churton Park/Grenada North
3) Eastern Suburbs
Miramar Peninsula (Miramar, Strathmore, Seatoun)
Kilbirnie/Lyall Bay
Hataitai/Mount Victoria (Eastern Slopes)
4) Southern Suburbs
Brooklyn/Vogeltown
Newtown/Berhampore
5) Western Suburbs
Karori
Kelburn/Northland
Wadestown/Wilton
Mount Victoria/Thorndon
- Risk factors: These heritage suburbs sit on steep slopes with many pre-1935 buildings that need earthquake strengthening. The Victorian villas hide the cost of extensive rebuilding.
- Key concern: Most people massively underestimate the cost of properly rebuilding period features. Pressed tin ceilings, native timber floors, and leadlight windows drive up costs.
Wellington CBD Apartments
- Risk factors: You're dealing with body corporate politics, varying earthquake ratings, and the uncomfortable fact that much of the CBD sits on reclaimed land.
- Key concern: The gap between what the body corporate insures and what you need to cover personally is often massive and misunderstood.
Oriental Bay/Roseneath
- Risk factors: Million-dollar views come with million-dollar problems. You've got salt spray eating everything, cliffs that occasionally decide to relocate, and wind that'll rip your roof off.
- Key concern: These properties cop it from every angle - sea, wind, and gravity all working against you. When access requires cranes or helicopters, rebuild costs explode.
2) Northern Suburbs
Johnsonville/Newlands
- Risk factors: Built in valleys that channel both wind and water. The infrastructure dates back to the 1960s and shows its age every time significant rain falls.
- Recent issues: The 2023 storms turned streets into rivers. Properties that had never flooded suddenly had water in the living room.
- Key concern: Wind funnels through these valleys at speeds that'll take your roof to Porirua. Meanwhile, water races down from surrounding hills faster than drains can cope.
Khandallah/Ngaio
- Risk factors: Premium suburbs built on challenging terrain.
- Insurance reality: These aren't just houses - they're engineering projects. Every rebuild involves significant earthworks and reinforcement.
Churton Park/Grenada North
- Risk factors: Newer suburbs that cop with Wellington's worst winds. Modern houses are built on exposed ridges where gusts of 140km/h are expected on Tuesday.
- Growing concern: These areas were developed with wind ratings from the 1990s. Climate change has made those calculations obsolete.
3) Eastern Suburbs
Miramar Peninsula (Miramar, Strathmore, Seatoun)
- Risk factors: Built on sand that'll turn liquid in an earthquake, facing seas that are getting rougher, and winds that never stop. Mirimar also sits in a tsunami evacuation zone.
- Key concern: The peninsula is basically a sandbar with houses on it. In a significant earthquake, liquefaction will be catastrophic.
Kilbirnie/Lyall Bay
- Risk factors: Wellington's flooding hotspot. Low-lying, poor drainage, and storm surges that push water in from the sea, while rain floods from above.
- Recent issues: Every significant rain event puts water through properties. It's not getting better.
Hataitai/Mount Victoria (Eastern Slopes)
- Risk factors: Spectacular views, terrifying drops. Retaining walls are doing heroic work. Access roads that make builders add 30% before they've even quoted.
- Rebuild challenges: Getting materials up these slopes requires specialist equipment. One builder told us they factor in helicopter delivery for some sites.
4) Southern Suburbs
- Island Bay/Owhiro BayRisk factors: The south coast cops everything Wellington's weather throws at it. Coastal erosion is accelerating, storm surges are getting bigger, and some properties are literally falling into the sea.
Brooklyn/Vogeltown
- Risk factors: Built on Wellington's steepest terrain with a history of slips. When one property goes, it often takes neighbours with it.
- Key concern: The 2017 slips demonstrated how a single failure can affect multiple properties. Your risk isn't just your land - it's your uphill neighbour's too.
Newtown/Berhampore
- Risk factors: Valley suburbs with water issues and Wellington's highest concentration of earthquake-prone buildings. Many homes need strengthening, as WCC outlines here.
- Insurance tip: If your property needs seismic work, factor this into insurance calculations. Insurers may require strengthening before full coverage.
5) Western Suburbs
Karori
- Risk factors: Wellington's wind tunnel and steep gullies can become waterfalls in heavy rain.
- Insurance impact: Wind damage claims here are constant.
Kelburn/Northland
- Risk factors: Wellington's premium real estate on its most challenging terrain. Every property is an engineering marvel (or disaster waiting to happen).
- Rebuild reality: $4,500-6,000/sqm+, and foundations often need to go deeper than most buildings are tall.
Wadestown/Wilton
- Risk factors: Historic slip zones on extreme slopes; access is so difficult that some properties need goods lifts.
- Often missed: Driveway coverage - when your drive is 100m of reinforced concrete zigzagging up a cliff, replacement costs are high.
Reminder: How to Find the Right Insurer for Wellington Homes
Who Offers What in Wellington:
Legitimate Ways to Reduce Costs include:
Dangerous Shortcuts to Avoid include:
- Area replacement: MAS and FMG (please note that FMG does not offer full Area Replacement, their cover is capped at the sum insured for Natural Disaster - they are also not limited to only rural areas, they are rural specialists but will insure urban properties). Our review of MAS Home Insurance (based on policy benefits and policyholder experiences) explains more.
- Standard sum insured: All major insurers
- More information: Area Replacement vs Sum Insured
Legitimate Ways to Reduce Costs include:
- Increasing excess to $1,000+ (if you have savings)
- Installing security systems
- Maintaining the property to reduce risks
Dangerous Shortcuts to Avoid include:
- Underestimating rebuild costs to lower premiums
- Excluding contents to save money
- Ignoring flood risk to get coverage
- Skipping annual reviews
The Bottom Line for Wellington Homeowners Looking for Robust and Affordable House Insurance
Wellington homeowners face a unique challenge - sitting on major fault lines while perched on steep hills, getting hammered by the world's worst winds, all while watching insurance premiums increase year after year as outlined in the NZHerald because Wellington's risks aren't theoretical, they're inevitable.
We believe many Wellingtonians are dangerously underinsured. Sum insured policies might leave you hundreds of thousands short when the next earthquake hits and every builder in the country descends on Wellington, charging disaster rates.
Essential Wellington Resources:
We believe many Wellingtonians are dangerously underinsured. Sum insured policies might leave you hundreds of thousands short when the next earthquake hits and every builder in the country descends on Wellington, charging disaster rates.
Essential Wellington Resources:
Frequently Asked Questions
Why is Wellington house insurance so much more expensive than in most other parts of New Zealand?
Wellington faces New Zealand's highest natural disaster risk, and seismic requirements, alongside engineering and wind-resistant construction, drive rebuilding costs.
After any significant earthquake, Wellington faces an immediate builder crisis - there simply aren't enough qualified contractors for seismic work. The few available charge whatever they want, and desperate homeowners pay it.
Add in Wellington's extreme wind (the highest recorded gusts in New Zealand), steep terrain, and aging housing stock that needs earthquake strengthening, and it's clear that insurers charge a lot for insurance because of the disaster risks.
After any significant earthquake, Wellington faces an immediate builder crisis - there simply aren't enough qualified contractors for seismic work. The few available charge whatever they want, and desperate homeowners pay it.
Add in Wellington's extreme wind (the highest recorded gusts in New Zealand), steep terrain, and aging housing stock that needs earthquake strengthening, and it's clear that insurers charge a lot for insurance because of the disaster risks.
Is my area considered high risk for insurance?
It depends on where you live - high-risk suburbs where you'll pay 50-100% higher premiums include:
- Earthquake/liquefaction zones: Kilbirnie, Rongotai, Miramar Peninsula, CBD, Petone
- Landslip-prone: Brooklyn, Wadestown, Northland, Karori (steep sections), Ngaio
- Coastal hazards: Breaker Bay, Lyall Bay, Owhiro Bay, Island Bay, Eastern Bays
- Flood zones: Tawa Valley, Porirua East, Kilbirnie, Petone/Lower Hutt
- Combined risks: Oriental Bay (coastal + hillside), Roseneath (all of the above)
How does earthquake risk affect my insurance, even if I haven't had damage?
Every Wellington property is now priced assuming the "big one" is coming. The Kaikōura earthquake, despite being 200km away, caused close to $1 billion Wellington claims and showed insurers how vulnerable the city really is. Your premiums factor in not just your individual risk but Wellington's systemic risk - when the fault moves, thousands of claims hit simultaneously, overwhelming the system.
Even if your property seems stable, if you're within 2km of a major fault (most of Wellington), your premiums reflect that proximity. Properties on reclaimed land or soft soils pay even more.
Even if your property seems stable, if you're within 2km of a major fault (most of Wellington), your premiums reflect that proximity. Properties on reclaimed land or soft soils pay even more.
My apartment body corporate says I'm covered - do I really need separate home insurance?
Yes - Body corporate insurance typically covers only the building structure and common areas. You're on your own for:
After the Kaikōura earthquake, apartment owners discovered massive coverage gaps and this 2020 NZHerald article outlines the increase in costs.
- Everything inside your walls (kitchen, bathroom, fixtures)
- Your contents and personal property
- Any improvements you've made
- Alternative accommodation if the building is uninhabitable
- The body corporate excess (often $10,000-25,000)
After the Kaikōura earthquake, apartment owners discovered massive coverage gaps and this 2020 NZHerald article outlines the increase in costs.
How much more does area replacement cost in Wellington?
Area replacement premiums are typically 10-20% more than sum insured premiums nationwide, though this varies by property and insurer. If your sum insured policy costs $6,000 annually, expect to pay an extra $900 to $2,000+ per year.
However, the upside can be significant - if you're underinsured by 30% on an $800,000 rebuild, you will face a $240,000 shortfall. That's 320 years' worth of premium savings wiped out in one claim. For Wellington properties where rebuild costs are volatile and disasters increasingly common, Area Replacement is cost-effective protection.
However, the upside can be significant - if you're underinsured by 30% on an $800,000 rebuild, you will face a $240,000 shortfall. That's 320 years' worth of premium savings wiped out in one claim. For Wellington properties where rebuild costs are volatile and disasters increasingly common, Area Replacement is cost-effective protection.
Can I get insurance if I bought in a flood zone in and around Wellington?
Yes, however, some insurers won't offer affordable insurance to properties that have flooded. Others will offer coverage but exclude flood damage - defeating the purpose. Your best options are likely to be:
Our View: If you're buying a home in a known flood zone, make insurance a condition of purchase - get confirmed coverage before going unconditional.
- Try MAS and FMG
- Use an insurance broker who knows which insurers are still accepting risk
- Be prepared for high premiums and excesses
- Never let existing coverage lapse
Our View: If you're buying a home in a known flood zone, make insurance a condition of purchase - get confirmed coverage before going unconditional.
I'm on a Wellington hillside - what special risks should I know about?
Wellington's hillside properties are engineering marvels with price tags to match:
Know This: Standard sum-insured calculations don't capture the reality of hillside terrain. A Brooklyn property needing helicopter access for materials will cost double what any calculator suggests.
- Retaining wall failures (often not fully covered by insurance)
- Access issues add 30-50% to rebuild costs
- Landslip risk from above AND below your property
- Wind speeds are 40% higher than forecast due to hill acceleration
- Foundations that cost more than most houses
- Ground instability that gets worse with climate change
Know This: Standard sum-insured calculations don't capture the reality of hillside terrain. A Brooklyn property needing helicopter access for materials will cost double what any calculator suggests.
What should Wellington apartment owners know about the "body corporate insurance gap"?
The biggest insurance mistake Wellington apartment owners make is assuming body corporate coverage is enough - it’s essential to read the policy purchased and understand it. We suggest considering getting your own contents insurance, and consider "improvements" coverage for any upgrades you've made.
How long do Wellington insurance claims take after a major event?
There is no single answer as it depends on the scale of the event and the aftermath. However, these are the general steps that will follow most claims:
- Initial assessment: 2-8 weeks (longer after major events)
- Approval process: 2-4 months
- Builder availability: 6-18 months wait
- Actual rebuild: 8-14 months
- Total timeline: 2-3 years is common
