If not, is getting am umbrella insurance policy on the DADU my only liability protection option and is it a good protection strategy? 

It was hot out there and the sheriff stood at a podium while a staffer held an umbrella over her head to shield the sun.

Alternatives like umbrella insurance or series LLCs may offer similar protections with less overhead.

I pay for umbrella above the insurance as well.Your rates are reasonable.

I have a current umbrella policy with USAA as well which in conjunction with the renters policy, would be several million more than Prosper's coverage. 

Also, with them i had a "landlord policy" which i would think is generally less expensive as the tenant has insurance as well and i have a separate umbrella policy with GEICO.  

Also, there are a variety of strategies under the lease option umbrella, and this diversity gives you a greater chance of providing the seller with what they need to do the deal.

My LT lawyer told me to make sure I update my insurance policies when I eventually transfer my LLC's or get an umbrella policy.

DSCR for STRs is commonly mislabeled under the "hard money" umbrella, when it's in fact a 30 yr fixed, fully amortizing loan (same structure as Conventional), with rates similar to conventional. 

Having both under one umbrella should put them at a great advantage.