Do you think it's common for a tenant to sue for an amount greater than insurance can cover, then take your property or even your personal assets? 

Instead of evicting them, i was thinking is there some way that I could rent it back to him for very cheap (mainly to cover just the taxes/ insurance) ie 2k a year rather than the going rate of 2k a month for similar properties.

Lower property taxes, affordable housing compared to LA (CA buyers are usually cash buyers because what they net from their smaller home in CA can get them a bigger home here, often covered by what they net from their CA sale), allergies (smog), and politics. 

You are competing against other owners who have a much lower basis and/or debt cost to cover. 

Is it covered by some bonding or insurance the inspection company holds?

For best results shop the vendors (who can be covered by insurance/meet HOA requirements) and get several options to your HOA management company to have the board pick from.

It appears that even if remodeling costs a little more, or takes longer and you miss even more rent, there is enough room to cover that and still be the winning strategy. 

We have an event this Saturday Feb 12, 2022, you can check out the Bigger Pockets page for it here:https://www.biggerpockets.com/...The group's page on Meetup.com is at:https://www.meetup.com/real-es...There is a $5.00 contribution which you can do in cash at the meeting as well, it doesn't come close to covering the cost of the space but I may be able to get another space shortly. 

For example do you have a great w2 and can you afford to cover costs of a major repair or 3 months of vacancy?

My broker could not find any other carrier to cover a rental condo.