Dog Bite Claims and Homeowners Insurance

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Americans love their pets.

Americans don’t always love their insurance premiums—especially if they own a pet that causes their homeowners insurance rates to go through the roof.

This month is National Adopt A Dog Month, and while it’s great to do so, you should know about some of the potential effects having certain types of dogs can have on your homeowners insurance–as well as what dogs with a bite history will do too. Mailmen aren’t the only ones being attacked by the furry love of your life, and the costs of having a dog may not be as minimal as dog food and vet visits.

According to the American Humane Society about 39% of people own at least one dog, and according to the American Pet Products Association, we own a total of about 78.2 million dogs. Sadly, the Center for Disease Control (CDC) tells us that more than a million people require medical care as a result of dog bites each year.

Because of this, you may find it challenging to obtain sufficient liability insurance if you own a breed of dog considered to be aggressive or which has a history for biting. Some of these breeds, including pit bulls, Rottweilers, huskies, pinschers, boxers, and several others have attained a bad reputation making them difficult or impossible to insure.

Whether you own a Pekingese or a Rottweiler though, most dog owners like to believe their pets are sweet-natured animals that wouldn’t hurt a fly, but animals can be unpredictable.

This can turn on a dime though, especially when little children are around, as dogs may snap and bite without warning. A child may suffer horrible scarring and a lifetime of trauma from one such incident. That would be a lot of traumatized, scarred children too considering that they account for approximately half of the 4.7 million people bitten annually, according to the CDC. Fortunately, the CDC says only half of those require medical treatment and around 16 die. In fact, so many children are the usual victims that they trump the image of mailmen getting bitten—the U.S. Postal Service even focused a recent campaign on dog biting towards children since they’re 900 times more likely to be bitten than a postal worker.

On the Rise

Dog bite-related lawsuits are one of the largest threats to homeowners. Fully one third of the claims filed each year by homeowners involve dog bites. This isn’t something that’s decreasing either.

According to the Insurance Information Institute, dog liability claims have been rising steadily for over ten years. Although they admit there’s not always a dramatic rise annually, it still rises consistently.

Case in point—in 2005, the III reported that dog bite claims cost the insurance industry approximately $317.2 million in comparison to $250 million in 1996. In 2010, bites cost insurers $413 million. In 2011, dog bite claims cost insurers a whopping $497 million dollars.

Not only are dog bites and insurance claims increasing in general, but so are the amounts of claims. According to III, dog bite claims have risen 53.4% due to inflated medical costs, settlement amounts, awards from juries, and judgments.

Whether dog bite claims are increasing because dog ownership is rising, because of a bad cases of nurturing, or because we’re so in love with our pets that we don’t practice enough caution, is up for debate.

Insurance Coverage and Dogs

One thing for certain though is that it is a growing issue, and for homeowners who have dogs typically pegged as ‘aggressive breeds,’ getting homeowners insurance, having a claim covered, and finding affordable premiums is certainly no walk in the park with Fido.

If we can’t predict the accident, at least we can responsibly prepare for the damages.

This is especially true since homeowners can be held liable in situations they’d never think they’d be liable for. Many are often surprised to find what they can be held responsible for–even when a dog that’s not even theirs bites someone on their property. Other odd cases have included burglars filing claims against families when they’ve been bitten by the family dog as they tried to rob the house, astonishingly winning damages. The American Kennel Club attempted to use this very point as an argument for ending “breed discrimination,” stating that having a dog can essentially be like a living, breathing alarm system preventing theft and intruders. However, that claim seems ironic provided that burglars have successfully broken into homes, been bitten, sued, and won an award.

That’s why it’s important to ensure you’re carrying sufficient liability coverage as a dog owner. Such claims can become life-altering events if you’re inadequately covered or, worse, not covered at all.

It’s wise for dog owners to buy umbrella policies, which extends liability from your auto and homeowners insurance. Available in limits of $1 to $10 million, it can make up financial gaps if your homeowners liability limit maxes out. This is especially true for business owners and those with large assets.

Even though some states have passed legislation making it illegal for insurance underwriters to deny coverage based upon the sort of pet you have, most insurers ask about your pets when getting insurance quotes.

That’s great legislation. Some states also have a “one-bite” rule, meaning a dog basically gets one ‘get out of jail’ free card—releasing you from liability the first time your dogs bite. In many other states though, dog-bite statutes exist, meaning if a dog bits someone, the homeowner is automatically held liable.

If you’ve found decent premiums with a carrier who will insure you despite of aggressive breeds, you’re very lucky and should do whatever you can to keep it since finding insurers accepting such breeds is rare, and homeowners with ‘aggressive’ dogs will find it practically impossible to not only find a carrier but also good premiums.

The Consequences of Not Disclosing “Aggressive Breeds”

Dog-bite claims are common enough and expensive enough already, possibly placing you in a dangerous situation, so imagine what would happen if your brand new, precious Rottweiler bit someone —the Rottweiler you never revealed.

In such situations, homeowners with certain dogs can face the same challenges policyholders do with other insurance products for failing to disclose something like this. This includes claims being denied completely or only receiving partial claim payments because of failure of disclosing, or because you exhausted liability limits This is in addition to your policy possibly cancelled and facing a lifetime of higher premiums. You could also be charged with an insurance fraud felony for failing to disclose the information and be charged criminally when your dog bites. Sometimes insurers won’t insure those with insurance fraud convictions and other felonies no matter what. If your liability is too little, you could face a judgment that claims your assets.

There’s a saying that there aren’t bad dogs, just bad owners. Nature vs. nurture is perhaps demonstrated more with pets than with humans, but the fact remains that all dogs DO have the capacity to bite. Like the nature vs. nurture argument, the question of whether it’s right to consider certain dogs ‘aggressive’ is probably one we’ll debate for a long time.

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