If you practice sound asset protection such as solid insurance coverage plus series LLCs or using trusts in conjunction with LLCs you're OK on the liability front.

I think Pitt bulls are great for personal protection.

What kind of protection (except contract) should I have before I wire the money? 

I'm hoping to rehab our side, switch units, and repeat.

What protections are there for the investors?

Eventually I want to switch over to real estate investing and build long term wealth so I can retire.

Exhaustive due diligence and conservative underwriting should protect you, but stuff happens and there are things that cannot be predicted. 

I want to make sure my assets are protected so I would like to know some opinions on what types of insurance I should have and when it makes sense to transition to a LLC because I currently own the properties personally.

Having 5 units also does give you some protection if 1-2 units have tenant issues, which is good.The estimated closing costs of $3,000 seems a bit low to me, but that certainly varies widely from lender to lender and from area to area.

My point is that for effective asset protection an atty specializing in asset protection designing a continually changing plans is necessary.