Basically in my view, bigger operations should consider an LLC while smaller scale investors should look for cheaper alternatives like umbrella policies which can protect you up to a $1 million in damages or more.

Lastly, I would consider an Umbrella policy in this situation if you do not have it already

I have a substantial umbrella policy if one ever does occur, so I laugh them off. 

I would add that you should get an umbrella liability policy that covers real estate holdings.DSCR would work best for you in this case if you're not going to live in it. 

Insurance would cover it, I would pay the deductible, and no assets would be lost.If you are in an area like San Diego where people are more likely to sue, a judge is more likely to find you guilty, and the payout is likely to be higher, then you may consider an umbrella insurance policy.

All of my properties are umbrellas under a single LLC.

.), and I have even selected one over anther because one has tattoos every inch of his body, and no I didn't tell the applicant he was turned away for excessive body markings and piercings.Getting back to familial status, if it is a violation to select a married couple over an unmarried couple, and if you tuck "roommates" under the umbrella of unmarried couples, then it may apply, perhaps loosely? 

My understanding is that a hard money loan is an umbrella term used to describe any short term loan from an individual/company rather than a bank, is that right?

Insurance would cover it, I would pay the deductible, and no assets would be lost.If you are in an area like San Diego where people are more likely to sue, a judge is more likely to find you guilty, and the payout is likely to be higher, then you may consider an umbrella insurance policy.

After discussions about sub-contractors' insurance and being an "additional insured", general liability, and umbrellas coverages, you might need more.