I feel like I can't protect against a situation where I get sued (e.g. someone slips and falls) and they "only" choose to go after the liability insurance on the property's policy, leaving the umbrella policy to pickup anything above/beyond the liability from the STR property. 

It helps protect your personal assets and keeps your business operations separate.

This will protect you from a tenant claim that they really had $2,000 security deposit, but the lease only said $1,000.

Nothing I've read in the state Landlord-Tenant Law says anything about it as a protected class, and I know the governor recently (2023) signed into law allowing landlords to not accept it. 

How important is profit vs protecting your asset for a future use?  

What protections would I have if the buyer defaulted?

However it does allow the agent and brokerage to be protected incase of commission disputes, it sets apart specific addresses or territories in which this agent is working with you.  

Like many (most) businesses it requires an investment of capital; money expenditure for ongoing marketing; management of operating, marketing and professional personnel; keeping accounting records and filing tax returns; established sales practices; constant monitoring of goals, budgets, and productivity; establishment and implementation of operational systems; and providing customer service.  

Turned it from a side hustle of flipping and renovating properties to owning and running a custom home building company.

The borrower is protected.