Because of this, the best set-up is an LLC with the highest liability coverage you can get plus the highest umbrella coverage you can get. 

The two options that come readily to mind are both Non-QM as a Bank statement loan and DCSR(Debt-Coverage-Service-Ratio) loan. 

There are three possibilities for the difference in claim payment vs repair cost:1. some of the damage is not covered2. they are withholding a portion of the claim payment until you show the work was done (if the coverage is "Replacement Cost" this is often the case on larger losses but normally not on this size)3.

If there is an existing owners policy and the LLC is the named insured, a sale of the membership interests in the LLC will not affect the coverage. 

They will have coverage for Auction claims, normal commercial coverage, etc.5. 

They explained that they give GAP coverage  IE they have to insure for the GAP between when they close out a file and disburse and the subsequent actual recording of the Deeds or mortgages.. 

I would ask your insurance agent what kind of coverage you have/need and what your tenant needs. 

I was a little unsure about certain coverages.

From there it would be about optional coverages, and deductibles in my opinion. 

Would I have adequate coverage in the event of a fire or vandalism under a standard landlord policy (likely won't have any tenants on the premises for at least three months).