I heard some say, get good insurance. 

Might want to investigate that with insurance provider and also make sure all fences and gates surrounding it are to code with the proper gate locks.

The property is actually in my mother in law's name but we have been paying the taxes, insurance, repairs, etc., as well as collecting the rent.

But you will have other expenses too: insurance, property taxes, maybe some of the utilities or HOA fees (I am assuming you are paying cash - if not, then a mortgage payment may eat up a lot of your profit).

People have been known to kill other people for petty life insurance policies. 

I have no other debt.I currently invest 50% of my income into an S&P 500 ETF as a way to save capital for my next investment without losing money to appreciation in a standard savings accountSo given that, here are some options I am considering:1. 

I'm good at self study and have done licensing exams like this before; I used to work in finance and insurance so I'm not totally new to the whole licensing exam idea.

Only recommendation there is to carry umbrella insurance, which you should have regardless.Your banker is correct on all accounts

 - Rent: $1550 per month- Vacancy: 5% -Capex 6.5%-Repairs 3%- Water and Sewer and electric and trash and HOA: $0- Insurance: $90 a month- Property management: $155 per month- Property tax: $375 a monthThis leaves me at $166 cash flow per month , $1992 per year.

We do insure against that but another layer of insulation keeps me happy.