CA is brutal when it comes to taxes.I don't give tax or legal advice, but many people believe that holding the property in your name and having a good umbrella policy is a good solution.

Also, would I need an umbrella policy if I go with commercial grade policy?  

Just get an umbrella and keep the home in your name. 

However, I’d like to have a space of my own before living with others again (I plan to house hack again with my next property).I’m seeking advice on how to move forward, as I need to consider things like utilities, taxes, landlord/umbrella insurance, and managing the property, especially with someone renting my garage.Specifically, I’m curious about renting out individual rooms and living on my own for a little while.

Any recommendations for Umbrella insurance providers for each partner to cover any liability?

Instead, an umbrella insurance policy may be a more cost-effective alternative for now.

Crossing the lines may not provide proper liability protection.Personally, I just kept my SF rentals in my name and got excellent insurance coverage, $500K per property plus a $2M umbrella.

My umbrella policy just sent me a non-renewal because Steadily is underwritten by Fortega which is not at least B+ rated. 

I could buy a LOT of umbrella (additional liability) insurance for $13,000.

Insurance would cover it, I would pay the deductible, and no assets would be lost.If you are in an area like San Diego where people are more likely to sue, a judge is more likely to find you guilty, and the payout is expected to be higher, you may consider an umbrella insurance policy.