I don't know what's involved in insuring a residence above a bakery, if any different (sounds like it would be...).
However, 3 thoughts:
1. Why do you need $2Mil in liability, unless you are worth that much?
2. Yes, you DO need insurance. All kinds of things can happen. For example, a long time ago, I lived in a rental where I had plugged up the kitchen sink, then accidentally left the faucet trickling....luckily, the landlord was very understanding and made some minor plaster repairs to the apartment below me and did not make a claim...it could have been ugly...
3. What would happen if you had to replace the contents of your apartment? Are your pockets "deep enough" to handle that?