Insurance isn’t just a wise investment for homeowners; if you’re a renter, you may need coverage as well.

In fact, some landlords and property managers actually require that you provide proof of renters insurance before leasing one of their units. But even if yours doesn’t, a renters insurance policy may still be worth it for the additional degree of protection it offers. Learn about the basics of this type of coverage in this list of frequently asked questions.

What is renters insurance?

While the owner of a property will likely have their own home or landlord insurance, it won’t cover damage to or loss of your personal possessions—only their own. Your renters insurance may protect you from paying out of pocket for hazards such as vandalism, hail, and lightning damage. It may also protect your belongings while traveling and cover you in issues of liability.

What does it cover?

An important distinction between renters insurance and homeowners insurance is that the former covers just what is inside a structure, not the structure itself as well. Some common hazards are excluded from basic renters insurance plans, including flood damage, mold damage, and pest-related issues such as bedbug infestations. However, you may be able to purchase additional coverage for these and other hazards.

There are four major categories of coverage in a standard renters insurance policy: personal property, loss of use, liability, and medical payments.

Personal property
As you may assume, this coverage area includes the possessions you bring with you into a rental home, including your furniture, electronics, and clothing. If you lose possessions to hazards such as a fire or theft, you can file a claim to get reimbursement for the value of these goods (though this payment may factor in their depreciation). Renters insurance can even cover possessions that you take with you outside your home. However, there are some limits to this, like reduced coverage when traveling overseas. You may also need to purchase additional coverage for luxury goods such as authentic jewelry and fine art.

Loss of use
Your insurance may offer compensation for hotel stays and other expenses incurred if you need to relocate temporarily while your rental property undergoes repairs.

Liability
The chief benefit of liability coverage is to protect you from lawsuits. If you are directly responsible for damaging another renter’s home or possessions, this coverage may pay for any necessary repairs or replacements. It may also include legal costs and medical payments to others should you accidentally or negligently cause them injury.

Medical payments
This form of protection also compensates for medical costs due to injuries, but unlike liability coverage, it pays for incidents in your rental unit only and regardless of who is at fault. For example, if a friend visits you and burns themselves on your stove, medical payments coverage may pay for their medical care, including an ambulance ride if necessary.

How much does it cost?

Though you may be loath to add another expense to your budget, renters insurance averages only about $14 to $25 a month according to USA TODAY Blueprint. This makes it a reasonably cheap investment in protection planning, especially when you consider that you’d be out thousands of dollars should, say, water damage from a burst pipe destroy all your furniture. Of course, these costs may vary depending on aspects such as your location, the value of your possessions, your chosen coverage limits, your deductible, and even your credit history. They may also increase in areas with higher crime rates and a greater likelihood of natural disasters. When shopping for a policy, get estimates from several companies to make sure you get the best rate for your particular situation.

How do you enroll in renters insurance?

The ideal method of obtaining coverage is reaching out to an insurance broker. You can discuss your needs and the details of your rental with them and obtain expert advice on finding the proper policy, which will depend on factors like your personal risk tolerance, the local cost of living, and the total value of your possessions. Working with them may aid you in building the appropriate coverage, especially if you have to satisfy strict guidelines from property owners, such as a specific personal liability amount. (Most coverages range from $100,000–$500,000.) A broker can also explain the inclusions and exclusions of your policy so there are no surprises when you attempt to file a claim. Further, they can help you customize your policy with additional protection like pet damage liability and identity theft.

As with virtually any other insurance coverage, your renters insurance company will only cover claims for dates that your policy was active. If possible, apply for insurance before you move into your rental to account for a processing time between the date that you request a policy and its effective date. Also, late or missed payments may lead to gaps in your protection, so be sure to stay current with them. Consider enrolling in autopay so you can retain consistent coverage—and for peace of mind that you will be safeguarded when the unexpected occurs.