Who needs third-party pet liability insurance

When people think of pet insurance they usually think of coverage for veterinary treatment for accidents and illnesses that may befall their pets, but there is another risk that pet owners may want to insure against -- the damage their pets may cause to others.

Liability insurance is a form of insurance that protects the insured from risks of liabilites that can be litigated in claims and lawsuits. If an insured is sued for a claim that falls within the liability insurance policy's coverage, the insurer will pay for the insured's defense and indemnify against any judgment or settlement that may be reached in the case.

Third-party pet liability insurance provides coverage for injuries that may be caused by your pet. The most common form of pet liability insurance available is dog liability insurance. There are more than 4.7 million dog bites reported annually in the U.S. More than 1,000 people per day go to an emergency room with dog bite injuries and 33 people died of dog bites in 2007. Most dog bite injuries happen to children, most of whom are bitten in the face.

We live in a very litigious society, and with the many personal injury attorneys who take cases on a contingency fee basis, there's little deterrent for folks who suffer even the slightest injury to refrain from suing if they think there's an opportunity for them to profit from a suit. Dog bites and other injuries caused by pets can leave disfiguring scars and long-term pain. Because of this, its likely that hundreds of thousands of dollars in damages or more may be awarded to a plaintiff in a civil suit regarding a dog bite.

More than $1 billion of losses related to dog bites occurred last year, $300 million of which was paid for from homeowner's insurance. Many homeowner's policies extend liability coverage to dog bites, but many do not. If you own a dog, you may want to review your homeowner's policy to see if it covers dog bites. If it doesn't, third-party pet liability insurance may be a good investment.

Aggressive breeds

While any breed of dog may bite someone, some breeds tend to be more aggressive than others. According to a recent study of all dog bite fatalities over a 20-year period, Rottweilers, Presa Canarios and interbred dogs from the two breeds were responsible for three-fourths of all attacks. These breeds were responsible for nearly 70 percent of attacks on children, more than 80 percent of those on adults and almost two-thirds of the fatalities.

Pit bulls have also been in the headlines recently for attacks on children and adults. Other breeds known for aggression include German Shepherds, chows, huskies and Dobermans. Insuring one of the more aggressive breeds of dogs may cost a little more than insuring a poodle or a dachshund, but when you consider the risk involved, it's a good investment to make.

When purchasing third-party pet liability insurance, experts recommend you purchase a policy that provides at least $100,000 in coverage for injuries that may arise from a dog bite. In some cases, if your homeowner's policy does not already offer dog bite or other coverage, it can be purchased as an add-on. Liability insurance for pets is usually inexpensive, but can run up to $1,000 per year for some pets, particularly aggressive breeds or animals with a history of biting. When applying for third-party pet liability insurance, your insurer will evaluate your pet, its history of causing injury, if any, and statistical data concerning how much of a risk that pet is. Based on this data, the insurer will approve or deny coverage and set a rate.

Coverage for non-canine pets

The vast majority of third-party pet liability policies are written to cover dogs. If you need a policy to cover another pet, it may be hard to find. Nevertheless, pet owners shouldn't snap up the first policy they find that covers their pet chimpanzee or snake. Like consumers of any other product, pet owners should shop carefully and make sure they understand the terms of the third-party liability policy they're buying -- what it covers and what it excludes and how much coverage it provides. Because of the potential for losses from a dog bite or other pet-related injury, it's wise to purchase a third-party liability policy to protect your wealth from a lawsuit, particularly if you own a breed of dog that's known to be aggressive. Paying a little in coverage now could save you considerably later if a suit is brought against you.