Your landlord's insurance may cover the property you're renting, but it doesn't cover your personal items. A renters insurance policy that covers your personal belongings in case they're damaged or stolen.
If there's a flood, fire or another form of damage that makes your rental unlivable for a time, your renters insurance policy may also cover temporary living accommodations. Some state laws and landlords require tenants to have renters insurance before moving in, but it varies, so make sure you know your state's laws and check with your landlord beforehand.
The biggest advantage of having a renters insurance policy is knowing you'll be compensated if something happens to your personal property. And although it's an additional expense to add to your list, it's inexpensive and can often be bundled with car insurance.
The downside is that there may be limited coverage on high-value belongings and, depending on the policy, it may not cover natural disasters. If you do need to file a claim, you're usually required to pay a deductible before your policy will cover the full value of your belongings.
If something ever happens to your belongings, renters insurance can save the day — and save you a lot of money. But even if you never file a renters insurance claim, you shouldn't feel like you wasted your money. Renters insurance can provide you peace of mind, which may be worth the price in the long run.