While as humans we want to give her benefit of the doubt, it sounds like there is a lot of tangible events that constantly went wrong. 

@Tony Roddenberry,Quick and dirty answer to your question.If you were able to take the roof off your dwelling structure, pick it up and turn it upside down, everything that falls out would be personal property (free standing appliances, furniture, area rugs, are examples) that could be depreciated over five years. 

Through ypur pm Humanly get her to leave and reason with her this can’t continue on .

If the property is solely tenant occupied you will be looking for a Dwelling/Fire Policy (may be called a Landlord policy or similar name) or a commercial policy such as a Business-owners or Package policy.Most Homeowners or Dwelling/Fire policies include:1.

Yeah Age of dwelling can be a factor but its still under 100 years old.

If your company does not, then you need to switch to a Dwelling/Fire form.  

I would be very surprised if you can find something with two legitimate dwellings in an A or B neighborhood for less. 

If you are NOT in an X zone, you are likly in an AE zone and then the rates are a function of the BFE Base Flood Elevation and the lowest elevation of the dwelling. 

(1) My husband already pitched the idea to her about this, so I'll just have to tell her that he didn't discuss this with me and the answer is no (2) Definitely agree that we are emotionally attached to this "dwelling" and have to see it as a rental property and not our home (3) We will talk with her, but I don't know how to avoid the small talk about us, I don't want to give her very much information and want to deflect all of her questions about us.

I thought by showing them that we clearly were not trying to gouge them that they would be decent humans and just own it.