And very high risk for injury or illness.  

The retirement wasn't planned,job injury. 

Following the advice is most likely foolish and may result in injury or death as well as financial burdens that would crush a normal human.If you decide to continue after the property I would get a lawyer and follow it step by step.

Is it common to require the contractors to either be covered by their own insurance for their errors or injuries on an owners property, or to have the property managers covered under their own insurance for the property managers injury on the owned property?

Regarding the injuries to uninsured workers you hire to work on your properties or others, you would need Work comp coverage. 

Strong disclaimer was my biggest rule- waiving of inconvenience, injury, loss of property, etc.I would have your daughter rent from you as the master tenant-- then the roommates rent under her.

Please note citation details below:Docket No: xxxxxxxx LO Section 301.3.1 (Lead)Exterior ConditionsDocket No: xxxxxxx LO Section 301.3.1 (Lead)Exterior ConditionsPlease take further notice that pursuant to the 1874 Pennsylvania Constitution (as ratified without subsequent amendments) Article 1 Section 10: “No person shall, for the same offense be twice put in jeopardy of life or limb nor shall private property be taken nor applied to public use without authority of the law and without just compensation being first made or secured.”The taking and injury of private property must be compensated.

Especially when out on the field I see a bigger opponent (the market) that can inflict serious injury.

However, for a judgment greater than $2.5M (say, $5M -- not unrealistic for a serious injury or death), I would lose everything in that scenario because the judgment creditor could come after all of the assets in the LLC after the umbrella policy caps out.

I see property claim denials on occasion when a landlord wants to treat their insurance policy as a deferred maintenance policy but I have not seen a bodily injury or property damage claim denied.