This is the most common oversight by self-managers, but it's the one that could be financially catastrophic.

Super expensive risks: Catastrophic damage or destruction to the unit.

We saw an 85% increase in our premium this year and because of this, we are choosing to go with the highest deductible we feel can live, effectively choosing for catastrophic purposes only.

You'll still cashflow.Oh, and if you've got only 3% appreciation (which I think is low), you're still far outperforming inflation even in a catastrophically horrible situation of zero cashflow because you're leveraged.

Insurance is for catastrophes not maintenance - if there isn't a "sudden and accidental event" you can point to as the cause for needing the repair then insurance does not applyCan we assume you have all galvanized pipes in the house?

Wildfire threat (especially for RE investment) is potentially catastrophic. 

Procedural errors will now be catastrophically expensive.What's going to happen is that many landlords and nearly all tenants won't know about the changes, so only a few landlords will get burned at first, and that amount will grow over time.

I believe it tends to give me a slightly lower return, because the sponsor is going to be more careful, and if there is a severe downturn will prevent me from taking catastrophic losses.

I think the OP is lucky not to have experienced catastrophic failure yet.

I believe it tends to give me a slightly lower return, because the sponsor is going to be more careful, and if there is a severe downturn will prevent me from taking catastrophic losses.