If you decide to buy the renders insurance, you can choose the following types. In addition, you also can consider purchasing a floater, which is a separate policy that provides additional insurance for your valuables and covers them for perils not included in your policy such as accident loss.

There are two types of renter’s insurance policies on hand:

1. Actual Cash Value – pays to replace your possessions minus a deduction for depreciation up to the limit of your policy. In reference to Legal Dictionary, it is the cost of replacing or repairing damaged property less any applicable depreciation.
2. Replacement Cost – pays the actual cost of replacing your possessions (no deduction for depreciation) up to the limit of your policy. Namely, the price that will have to be paid to replace an existing asset with a similar asset.

You’ll have to decide if you want to insure for the actual cash value or the replacement cost of your home and possessions. If your television is five years old, it’ll cost a lot more to replace it than what it’s actually worth. Replacement cost policies typically cost more.

With either policy, you may want to consider purchasing a floater. A standard renter’s policy offers only limited coverage for items such as jewelry, silver, furs, etc. If you own property that exceeds these limits, it is recommended that you supplement your policy with a floater. A floater is a separate policy that provides additional insurance for your valuables and covers them for perils not included in your policy such as accident loss.