The way I read the law (I am not a lawyer) is that the amount of withdrawal does not have to correlate with the amount of economic damage.

I've been got before, rehabbing a fire damage in city of Atlanta.

You might look at all the things renters have done in terms of damage to your vacation property.Also, for the vacation rental side, you might explore adding an ADU to it as another rental unit and swapping that instead of to main vacation house. 

I would think that policy (loss of business income) would only kick in on property damage specific to your business. 

Good for entering tenant, starts lease clean with no inherited unit damages.

I know they are liars and the thought of that seems ridiculous, but in this day and age, you never know.They'd have to have suffered some kind of actual damage due to some negligent/intentional act on your part to even have a case.

Technically the house is not out of code, however, if there were to be an electrical surge it could damage appliances plugged into ungrounded outlets or potentially cause a fire.

Charge the tenant that did the damage. 

Without knowing whether they are gas, electric, or oil I can't tell you a lifespan.The water heaters are the concern for preventing further damage.

Threaten her with seeking damages?