If there's a fire or other loss in their building that means they can't use the apartment, the policy pays for alternative accommodations such as a hotel. (effectivecoverage.com)
Furthermore, if your house is damaged, you will need to find alternative accommodation for the time being. (rentersinsurance.net)
You can also look into coverage for moving costs and alternative accommodation if your current rental townhouse burns down. (rentersinsurance.net)