The man accused of lighting the fatal Loafers Lodge fire believed people were trying to harm him

The 50-year-old's pleaded not guilty to five murder and two arson charges, as the Wellington High Court hears of his extensive psychiatric history.

He had absconded from a hospital in Auckland, where he was receiving treatment for paranoid schizophrenia, just weeks before lighting the fires.

Herald Reporter Melissa Nightingale says he's pursuing a defence of insanity - and needs to prove he didn't know his actions were immoral.

She says a recurring theme for him was paranoia about persecutory delusions, and people trying to poison him.