I say have a good umbrella policy, figure out your risk tolerance, understand the cost and hassle-factor of maintaining multiple LLCs (different accounts, different books, different tax filings, etc.) and go from there.

Hi, I'm debating whether I should purchase umbrella insurance or setup an llc for my rental.

Also, if you already have an umbrella policy, now the one policy will cover the both properties --- a plus. 

What is the action that triggers changing from insuring each property one-by-one to creating an umbrella policy to cover the portfolio?

We have insurance and a large umbrella policy to protect us against potential liabilities that might happen.Good luck and if you have any other questions please PM me and I will answer them for you.

I've gotten some mixed opinions: create LLC vs purchase more insurance per house in addition to umbrella policy.

I buy my properties in LLC name and I also have an umbrella policy for added protection. 

@Kevin Hoag well it is owned by a non profit agency of the town and I was told it is held under some large umbrella policy.

Regarding having multiple mortages, insurance policies, I believe there are portfolio loans and umbrella insurance policies for having multiple properties. 

The only real risk is personal injury and an umbrella liability insurance policy will cover that.