If you're going the umbrella insurance route, make sure it will cover you for several things including just the routine slip and fall (like mold or earthquake).

Unreinforced masonry does not do well in earthquakes.

@Doug Norton other critical issues include: decreasing availability of water and increasingly poor air quality, and an impending earthquake that is anticipated to cause significant total loss rates for the un-reinforced masonry buildings that make up much of the housing stock in the city...obviously, nobody knows when that will occur, but geologists generally agree that the earthquake is a matter of "when", not "if" (yet, my impression is that very few property owners have earthquake insurance)...it's hard to know how these issues will play out, but there is evidence that one or more of these issues will become un-ignorable on a 10-30+ year timeline.ADUs are an interesting prospect, but the last time I got quotes for building an ADU in SLC, the numbers really didn't make much sense in terms of ROI as a long term rental...of course, people build ADUs for reasons other than ROI, so it will be interesting to see what happens...Between the world-class outdoor attractions, events like Sundance Film Fest, and all the other attractions of the city and surrounding area, I would think that demand for STRs could be pretty huge...the city doesn't allow STRs, but as you mentioned, that doesn't stop people from doing them, and my impression is that some folks have cleaned up using ADUs as STRs...As with any place, the SLC RE market is highly localized, and there's a solid argument that the desirable neighborhoods (the Aves, the U, Sugarhouse, E Millcreek, and most stuff on the E side) will always be in high demand--everyone wants to live in these areas, and there's limited supply. 

Browns valley is a favorite for locals but beware a major earthquake fault line runs through the area. 

How much damage in a moderate 6.0 earthquake would be done to a small single story home? 

If you're going the umbrella insurance route, make sure it will cover you for several things including just the routine slip and fall (like mold or earthquake).

You just really need to keep in mind what you would do with the property if you did suffer a total loss (fire, earthquake, explosion, collapse, etc....)Another big recommendation I have is to ALWAYS require your tenants to carry renters insurance.

If you're going the umbrella insurance route, make sure it will cover you for several things including just the routine slip and fall (like mold or earthquake).

I have seen lenders push back on insurance and require additional flood/earthquake/wind policies the day of escrow closing. 

Don't let it get in the way of your deal if the house is nice otherwise....property is in California and will need Sesmic retrofit for earthquakes.