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

Once the interior was stripped and the infrastructure tested, I brought in commercial contractors to handle critical systems like plumbing, electrical, roofing, and HVAC installation.The house, built in the early 1900s, was originally a coal-burning residence.

Get replacement cost hazard insurance along with an umbrella policy of at least $1M, probably double in your area.

I had a lot of plumbing work done (rough in basement, egress window work that he arranged, etc) to the tune of $7,000.

You mentioned gross rents of $3400 per month and Principle/Interest/Tax/Insurance of $2500 per month. 

You are looking at the rent of $2,000 and mortgage (Loan, Insurance, and Taxes) of $18000 and thinking you have $200 cash-flow.

A good manager will handle everything from marketing to maintenance and tenant screening, saving you time and stress.Vendors and LandscapingBuilding a team of dependable vendors—like landscaping companies, contractors, and insurance agents—is critical.

Might be an additional cost there.If units are updated, capex items look good, leases and tenants look solid, and there are no other regular expenses besides the 5200 in insurance/property taxes then I like this deal.  

Maybe it is more difficult if the damage was more serious like fire or flood but it goes same with any insurance claim.

The bottom line is this: Concealment is not asset protection, proper (time consuming and expensive, I know) management, and good, prudent, practices (ditto), WHICH ARE ADHERED TO, and insurance (expensive), are needed for asset protection.