- Why didn't the contractor's insurance cover this?

If they did, the previous manager is obligated to transfer those funds.

It isn't having paid off properties that offers security, there are still taxes, insurance, maintenance and management involved. 

With that they may be able to recoup from their renters insurance (hopefully you require this)  If locks are damaged and the unit isn't secure you would need to take care of that right away.

Here’s some context: Property 1: >$100k in EquityValue: $325kDebt: $220k @ 2.88% (30-year fixed)Property 2: >$70k in EquityValue: $325kDebt: $252k @ 3.38% (30-year fixed)Extra considerations: - I have $15-20k liquid to use for any of these deals- My current job is relatively stable, but not high-payin- Current properties in TX, living in NY, looking to invest in Mid-West (crazy, I know)- No other debt obligations besides the two mortgagesUltimate goal/timeline: Though a bit ambitious, I’d love to build up the portfolio to 10-20 units in the next two yearsI understand that any/all replies aren't financial advice; all ideas welcome for information purposes. 

I'm looking more for an overarching portfolio spreadsheet to track asset performance over the lifetime of holding the asset.If you have the property manager paying the mortgages, taxes, insurances, doing all the accounting, etc why not just ask them to generate whatever report you want?

When the numbers were tallied, he had actually lost about $10,000–$20,000 per property.Here’s the kicker: Had he simply bought the properties for $80,000, left them vacant for seven years, and only paid taxes and insurance (about $1,500 per year per property), his all-in cost would’ve been around $90,500.

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.

One has a 162k mortgage, $1250 tax,Insurance,%3.5 30 yr, worth at least 750,000 LTR rent $3200, #2- Los Angeles worth   $750k as well just did a remodel of 150 K, mortgage is 75,000 payment $700.tax,Ins, Mtr/str hybrid.

I also assume you have homeowners insurance rather than landlord policy which is invalid if you’re not living there.