You and your landlord both need to know that your interests are protected. For your landlord, this probably means a security deposit from you, usually the equivalent of one or two months' rent. A security deposit assures your landlord that any damages to the apartment while you are a tenant will be covered. The landlord also may keep the security deposit if you fail to pay rent or leave before the end of your lease. But security deposits are refundable if you fulfill your lease agreement and leave your apartment in good repair. In most states, the landlord must itemize any deductions from your security deposit. Additionally, some states mandate that security deposits be kept in separate interest-bearing accounts for the tenant.

Insurance protection

The owner will insure the building. To protect your personal property, though, you will need to buy a renter’s policy. Your rental insurance policy will typically protect you against losses from:

• Damage to your personal property from fire and/or wind
• Theft
• Personal liability if you are sued over accidental injury that occurs in your apartment
• Living expenses if you are forced to live elsewhere while your apartment is being repaired

Policies may differ from state to state and among insurance companies. Consult an insurance representative to determine the type of policy appropriate for your situation.