Personal Liability Protection

I have 2 investment properties, both in my name, in 2 different states. I am not married with kids yet, and would like to protect the properties and myself. Would it be best to buy liability insurance up to their market value followed by an umbrella policy, OR, form an LLC in each state for each property and have a management company (LLC), say in Nevada, manage them? I DO NOT like the fact that I am so exposed legally and what like to know the best course of action based on the experience of others out there.

Insurance will be sufficient.

Hi BLL will you explain what if it is the other way around. Any response would be very helpful. Nick Brian.

Not sure what you mean. Any type of planning at this stage will not be as cost effective as insurance. The other option described would require the annual costs for 5-9 LLCs (even though only 3 will be formed) without any increase in effectiveness over insurance. The Nevada costs alone would be over $400/year plus the costs to prepare a tax return and there isn’t any benefits of a NV LLC with this set up.

BLL, OK so at what point would the LLC track be cost effective and prudent (how many properties)? As for insurance you agree that an insurance policy on each property followed by an umbrella policy would be the most prudent and cost effective move at this point?

It depends more on your other assets and the costs for your states. Typically, advanced planning makes sense with a net worth of at least a few million.

That’s the way I would go unless there is something atypical about your situation.