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Beware of dog – biting dogs could increase your homeowners insurance

Americans love their dogs. But owning certain breeds may cause your homeowners insurance premiums to increase.

According to the Insurance Information Institute, dog bites accounted for more than one-third of all homeowners insurance liability claims paid in 2010, costing nearly $413 million.

Some insurance companies have included “dangerous dog” clauses in their homeowners policies and won’t insure a home that has those breeds.

“If a company has had experience over a number of years with a particular dog breed that has cost them money, it’s their prerogative not to insure something they perceive as a risk,” Loretta Worters, vice president of the Insurance Information Institute told Tim Grant, a reporter for the Pittsburgh Post-Gazette.

Dogs on the “dangerous” list include pit bulls, Rottweilers, Doberman pinschers and German shepherds. Other breeds may include supersized canines such as English Bullmastiffs and Great Danes.

Pennsylvania State law does not allow an insurance company to terminate an existing policy because of a dog, unless the dog has bitten someone without provocation. And most insurance companies will provide homeowners insurance for homeowners with dogs until something happens. Once a dog has bitten someone, the insurance company could charge a higher premium, drop the homeowner’s policy or exclude the dog from coverage.

Worters suggests that homeowners purchase a policy with higher liability limits. Most standard homeowners policies provide policyholders with $100,000 to $300,000 in liability coverage. If a claim exceeds those limits, the dog owner is personally responsible for damages above that amount, including legal expenses. Purchasing $500,000 in liability coverage may only add $20 a year  to your annual premium. It’s worth the peace of mind.

A homeowners policy provides medical coverage in case a dog bites a friend or neighbor. Homeowners can usually purchase $1,000 to $5,000 worth of this coverage. This provides a small “goodwill payment” even if you feel your dog was provoked and not at fault. Often a small payment avoids legal action against you. However, if this is not enough, then the liability insurance provided by your homeowners policy will pay on your behalf, including the cost of an attorney to defend you.

For the most part, the majority of dog breeds aren’t a problem … unless the dog you own has bitten someone in the past.

 Call E. R. Munro and Company at 877-376-8676 or visit our Web site at www.ermunro.com for more information on homeowners and liability coverage.