I have looked into forming an LLC a few times in the US (right now I am better off not doing so for tax reasons while I am abroad but that is another story). However in my research, I may be misunderstanding something but I couldn't find much that the limited liability actually protected against.
For bad business dealings the freelancer is negotiating personally, he may still be sued in addition to the LLC so it isn't clear to me that provides much protection, and
Most banks would have required that I co-sign any loan for the business, thus ensuring I wouldn't be able to run away from business debt.
From what I looked at it did look like some business debts would be harder to forcibly collect against anything other than business assets but those would only be likely to be smaller routine debts (buying things on business credit for example).
So what I concluded was that at least in the US, limited liability looked like it protected investors from loss, and business partners from eachother, but didn't offer much protection for the sole principle business owner. Am I far off on this? Am I missing something major?