Covering expenses upfront for this many units can really cramp their cash flow and is simply unnecessary risk for them.

We used the money we received toward the purchase of our current home, and to pay off some unnecessary debt we had accumulated. it honestly hadn't dawned on me that we flipped that house.

If you are going to buy 1 rental per year it is good to have all of these people but some may be unnecessary like the attorney, title company, CPA, banker. 

$550K seems really high and unnecessary, but also don't want to make a poor decision in case something happens.I think I am going to ask for a version of the quote keeping the replacement value at $415K, but lowering the deductible to $1K instead of $5K.

Need to make sure I’m doing this correctly and not exposing either of us to unnecessary risk.

Because that is my own personal threshold for too much hassle for something that is unnecessary. 

The explanation was not at all what I meant (I posted what I meant) and was a practice I wouldn't recommend and that was completely unnecessary for the original questioner.

That’ll be very expensive and unnecessary.

At which point is it unnecessary?

I feel so sorry for that family, their lawyer totally screwed them over and they lost a lot of money paying fees for unnecessary services and he tangled up their lives at a time they were most vulnerable.