There are a couple great podcast episodes on asset protection, the main show ep. 595, and BP Rookie ep. 105 & 106, that give a ton of great information on what LLC's can and can't do for you.For me, I personally use an umbrella policy for my protection but did setup an LLC immediately more so for financing later on down the road.

I found in the 15+ years of doing RE that a simple strategy for anyone starting out or those who still have mortgages on properties to get good insurance with umbrella policies.

The plan itself provides you the checkbook control necessary to effectively invest in notes.You could choose to form a LLC under the umbrella of a 401(k) as a means of creating asset segregation, but since notes generate very little in the way of liability, that is probably not necessary.  

I have an umbrella policy for the liability and figure once I push past 3-4 properties I may begin to establish LLCs.

At that point, your net worth is greater than most umbrella insurance policy coverage limits.  

However I did get umbrella policy on top of the regular insurance for each building.

There is vacancy (you have too much experience with this), maintenance/cap ex, PM (even if self managing you deserve compensation for this task), miscellaneous (portion of accountant, tax nan, office expenses, umbrella policy and/or LLC, etc).  

The suit is pretty ridiculous for 2 Million against me and 2 million against my property manager.I have personal umbrella policy but that only represents me.

My wife & I are planning to purchase our first rental property next year.I have read so many different things about LLC's vs Umbrella Insurance & I still haven't come up with a plan of action.When leasing our properties I would prefer my tenants to pay thier rent to a enity and not me or my wife's name.

Ask your agent about an umbrella policy as well.