In the course of preparing home insurance quotes for a new home buyer in Chandler, Arizona I ran across this liability claim that was associated with the property that my client is purchasing. Now, I've included info about dog bite claims before in several of my blogs...see my pictograph and scroll to the nasty Chihuahua (no offense intended if you're a Chihuahua lover)...but I rarely see claims out there with these kinds of actual payouts. In fact, in my 23 years as an agency owner in Arizona I don't recall a claim for any of my clients related to a dog bite. If there was, it was probably very minor because it's not memorable to me.
Just to put this in perspective. Would you be able to pay $850 per month for 5 years to compensate the injured party? That's a payment for a nice luxury car. Another way to put it is that payout was about what my first home cost in 1989.
The point is most of us would struggle to pay that kind of money (which doesn't include the cost to defend...i.e. attorneys costs) even for a short period of time. This is why we have insurance.
Think about it. If you pay $1,000 annually for your insurance and you have this claim, it will take the insurance company 51 years to recoup their loss (it's really much longer than that because the premium you pay isn't 100% profit to the company). Oh, you might say, "the insurance company is just going to surcharge the policy to get their money back." And you would be partially correct. Of course the insurance company will surcharge for this claim but it will only be for a 3-5 year period and it wouldn't be but small fraction of the actual loss paid out.
This is a good time to warn you to review your policy about dog bites. Many insurance companies are limiting or excluding, altogether, liability for dog bite claims so it's in your best interest to ask your agent about your protection under your policy.
One final note: ALL DOGS CAN BITE even the little ones so don't assume that your cute Westie can't do much harm. They certainly can. These are my two Westies by the way and my daughter's Border Terrier.
Author Richard Morris
Richard Morris, an independent insurance agent in Chandler, Arizona, has been serving and helping Arizona families with all their insurance needs for over 23 years. Visit his website at http://www.southwestpremierinsuranceagency.com to see all the ways he can help you with your insurance needs or call the office at (480) 336-2707 or toll free at (888) 907-9349. Connect with Rich on Google+ and Twitter.