But I also think the main tenant's reading comprehension is lacking, on top of that. 

In terms of health care expenses, I find a lot of people stay in soul sucking jobs without exploring what it would actually cost to buy their own coverage.

Also, you will need to max out all current property coverage before you can get an umbrella policy so all of your policy costs will go up.

The only thing I could think of is if my brother or parents, who still live in OH, become the LLC member(s) but I don't really want to put that burden on them (and not sure if that is even "legal").The other option it seems that I'd have to go with is an Umbrella Policy which should be cheaper, when compared to the LLC and the dumb CA tax (but I do not have an Umbrella quote yet).Are there any other reasonable options for coverage against your personal property/financials in case of legal issues?

He also saved me several thousand for my E&O insurance....with better coverage.

Dwelling (Building coverage)The limit should be based on the Replacement Cost of the building (cost to rebuild withthe same kind and quality excluding the foundation)2.

This coverage protects you and your property from a whole host of problems including a tenant's pet biting a guest and more. 

Matt Faircloth and Hunter Thompson have comprehensive books on the subject.

. -- sufficient for small damage A replacement cost policy - preferred because of more coverage and will cover the full cost of a major loss.

The first step is to start with the city and find out what you can actually do with the property based on setbacks lot coverage parking utilities etc. you can find a lot of this out on your own without spending any money first.Once you determine what you can build you can then do a quick financial feasibility to see if the project makes sense financially.