Umbrella insurance 

Managing this rental so far has been easy and it rents fast.Now the SE PDX market seems to be growing at a slower rate than it was couple of years ago and if we don't sell before next year April, I would have to pay capital gain taxes.So my question is - Should I sell this house now and avoid paying capital gain taxes and re-invest the proceeds back when the market hits a downturn or hold on it this house for the long term?

The only purpose of the account would be to collect payments and pay bills like taxes and insurance on assets held by the LLC.

No life insurance, minimal workman's comp.

It's possible that they mean that they don't want to carry owner financing, but you should clarify that.Be sure that you buy owner's title insurance too. 

I cant afford to get insurance with this loan. 

That is one of the advantages of owning property outright - yes, the return might suck, but I have homes that will cash flow, accounting for maintenance, insurance, taxes & capital expenses, at $300 per month.

The buyer sends escrow payments for taxes, sewer and insurance.  

@Bud Dwyer  You would have notify your insurance company to get it properly insured, who in turn would most likely notify the bank.

In no particular order:You might not have a first lien after all - At the closing, is your borrower obtaining a lender's title insurance policy from a reputable agent?