Most flying school hire agreements are pretty straight forward, with no major "gotcha" pints where you lose your house. I've had to deal with many instances where the client didn't read the fine print and was angry with the resulting costs. Insurance wise if you operate the machine outside the conditions the insurance generally will negotiate understanding the average Joe can't afford a few hundred thousand in repair bills, however the negotiated amount will still be very high. I know of hirers out of pocket in excess of $20,000 (20+ years ago) for damages incurred operating to non approved airstrips, not following procedure/rules, etc... The most common one I remember is fuel rebates for wet hires, almost no one reads the part that you are only rebated at the home airport rate. So if you hire the thing in Moorabbin where the company pays $2 per ltr, and fill up middle of nowhere for $10 per ltr, you only get rebated $2 per ltr.
As for the liability, most cars and houses are covered up to $20 million or something silly these days. I've never really read what is covered though, as I assume there would be a long list of exclusions to what liability is accepted, apart from obvious deal breakers like illegal operations, being drunk/drugged, and so on.
I think asking people to carry $50 million in liability is stupid, there are situations in a car where you could sneeze, crash and cause a fire that burns down a large property worth hundreds of millions. There is no way you would be expected to cover it if it was accidental, and if intentional you'd get jail time.