I really don't want them to pay the claim and then have my rates go up or possibly drop my policy (not likely but worst case scenario I guess).It's too late, it's now a reported incident, your rates will go up.

I'm thinking I will instruct the property manager to kick them both out--the drunk first and then the crazy one--but I'm afraid the crazy guy will retaliate in some way.The police are aware of the incident, but feel like they won't do anything until something really bad happens.

We insulated the sill and headers, then wrapped the pipe and there have been no further problems.Is it a difference in building techniques (insulation, location of plumbing runs, etc) which contributes to the seemingly high incident of frozen pipes?

I think this is an isolated incident.  

I would also get a letter from the construction company you guys used, indicating the extent of the work that was done up to the point of the incident that will help in the adjusters appraisal.

They said it has to be 7 years from the time of the incident in order for me to apply for an umbrella protection plan.

It will report things like, this applicants past address is associated with multiple incidents of fraud etc.  

Their advice was you would have to be able to show 8-10 incidents of this behavior (for them to take it seriously), take it to the local PD, then the case MIGHT get kicked up to the DA's office and local RE commission.If you are the one being harmed and can win a civil lawsuit, most states have a recovery fund that will pay out on the judgment, and take it from the agent/broker''s commission(s) or assets, within a year of the judgment.

Apparently the police were called after the bite incident and the police didn't really do anything.

all it takes is one incident..."