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What is and isn’t hidden gradual water damage?

Gradual water damage claims are not always straightforward.

Home insurance protects you from sudden damage like a burst water pipe. But gradual damage over time generally isn’t covered. There’s an exception to this. Most house insurance policies in New Zealand have a extension for Hidden Gradual Water Damage extension.

However, there’s certain conditions that need to be met to make a claim for this cover.


When can I make a Gradual Water Damage Claim?

Damage needs to be hidden, and caused by an internal water pipe or tank.

Essentially the water damage or leak needs to be hidden from the naked eye. If the leak isn’t hidden there won’t be cover as the damage could have been prevented.

Cover is specific. The source of the water damage needs to come from a tank, hot water cylinder or water/waste pipe.

Examples of Hidden Gradual Damage Claims:

  • Sink waste pipe behind kitchen benchtop was leaking which damaged and moulded below cabinets.
  • Shower’s pressure pipe behind wall was leaking and slowly rotted wall lining and floorboards.
  • Broken valve on hot water cylinder leaks water down the inside wall and swells the wooden flooring.

How much cover do I get?

Most house insurance policies have cover for this but with a limit. The limit can range from $1,000 to $5,000 and your excess is taken from the limit.

Our home insurance includes $3,000 of cover.


What will not be a Gradual Water Damage Claim?

The conditions are narrow. Any damage from a leak you can see, or one that doesn’t come from a pipe or tank is unlikely to be covered.

Examples that won’t meet the conditions for a Hidden Gradual Damage Claim:

  • Leaking window frame causes rain to leak onto the window sill and rot.
  • Water leaking onto the floor from a faulty washing machine (unless the leak was from a hidden pipe).
  • Damage to the carpet caused by moisture from a potted plant.

What if I’m not sure what type of damage it is?

It’s hard to know exactly how the damage has occurred or where it’s coming from. If you’re not sure we recommend getting a repair quote from a tradesperson ask them to include their opinion on how the damage happend.

Is the leaking pipe itself covered?

Your insurance cover will protect you for the damage that results from the leak, and the costs of finding or getting to the leak.

The cost to fix the leaking pipe itself; or the actual cause of damage won’t be covered. Insurance will pay to repair the resultant damage, but fixing the faulty pipe or equipment will be your responsibility as a homeowner. In most cases this cost is a small part of the total repair costs.

Learn more about the cause of damage here.


Hidden Gradual Damage Claim Example

A tenant discovers the kitchen floor is spongy under the lino where the water pipe for the cold tap had been slowly dripping. Over time the kitchen cabinet swelled causing the particleboard to deteriorate. The landlord gets a builder to quote the cabinet repairs and a plumber to fix the leaking pipe.

Item Amount Claimable?
Sink Cabinet Panels $866 Yes
Fixing, Screws, Glues $63 Yes
Particle Board Sheet $110 Yes
Builder’s Labour $590 Yes
Relaying of Lino $783 Yes
Piping Replacement $25 Not included in cover
Plumber’s Labour $100 Not included in cover
Total Repair Costs $2,500
Less costs not claimable $125
Total Claimable Costs $2,375

Your standard policy excess will then be taken out of your payout.


Initio is a specialist house insurance provider. Our online approach means that customers can get a quote in seconds, be covered in minutes and have their claims managed and paid quickly.

Learn more about our house insurance and landlord insurance.