Renters insurance provides financial reimbursement to cover a tenant's lost or damaged personal property as a result of a loss covered by your policy, such as fire, theft or vandalism. It also provides liability protection for the policyholder if a person is injured on the premises of the rental property. Liability protection also applies if your dog bites someone at the property or elsewhere, like a park. Renters insurance can also provide compensation for your living expenses if your rental unit/home becomes uninhabitable due to a covered loss.