Even though you don’t own the residence, you still need insurance. The landlord
will insure the building itself but not your personal belongings. Renter’s insurance
will cover your stolen or damaged property caused by others or natural disasters.
The basic policy will also cover medical bills for anyone who gets hurt while visiting
you. Damage caused by floods, earthquakes, and high winds will not be covered in
the basic policy. If you live in an area prone to these types of disasters, you
will have to buy a separate policy to cover these
conditions.
When you need to replace your property, the insurance company will pay you either
the actual cash value or the replacement cost of the items. Actual cash value only
pays for the value of an item at the time it was damaged or stolen. Replacement
cost coverage on the other hand, pays what it will actually cost to replace the
item. Check with your insurance agent for details on the payout options available
to you.