The security deposit is:
- a fixed amount of money paid at the start of the tenancy,
- held as a guarantee,
- used to cover unpaid rent, utilities, cleaning or damage,
- limited to the amount you paid (for example 500–800 EUR).
Insurance is:
- a separate contract with an insurance company,
- usually covering bigger or unexpected risks (e.g. fire, water damage, liability towards neighbours),
- able to cover costs that are higher than your deposit, depending on the policy.
Simply said: the deposit is not insurance, and insurance is not a deposit – they work together, not instead of each other.