Tim, in lieu of a damage deposit, have you utilized A deposit insurance such as Rhino? 

However, due to rising insurance and tax costs, I'm starting to feel the financial pinch as the tenant currently pays rent 60% below the market average.My long-term goal is to acquire more properties, and I've considered doing a cash-out refinance to access equity for reinvestment.

Do you think First Insurance will, insure in a high fire risk locale? 

Your insurance company might want to look at the property. 

For instance, depending on your location insurance costs could be much much higher than indicated in the book, construction costs are a lot higher, etc. 

Include an exit strategy, tax planning, and insurance to protect both parties.

Good insurance, particularly with an umbrella liability policy provides very adequate protection on smaller assets. 

I don't think the insurance is very expensive.  

Without running any specific numbers yet, and ignoring my 200k loan repayments for now, if I my rent income minus property taxes, insurance etc and everything else related to the expenses of the property (again, ignore the 200k loan repayments) comes out to anything beyond 12000 annually in the first year I'll probably be relatively satisfied with that outcome. 

what is damage protection insurance?