Gone to the dogs -- Insurance companies blacklist certain canine breeds

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Gone to the dogs -- Insurance companies blacklist certain canine breeds

by David Benda
Record Searchlight

Dog-bite claims are taking a chunk out of insurance companies' coffers.

In an effort to crack down and cover themselves from further losses, some insurance companies have blacklisted breeds.

For example, Allstate Insurance Co. in California won't provide new coverage to people who own Akitas, boxers, chow chows, Doberman pinschers, pit bulls, Rottweilers, wolf hybrids or Presa Canarios, company spokeswoman Lisa Wanamaker said.

Allstate's list is based on information culled from outside sources, including the Centers for Disease Control and Prevention, Wanamaker said.

The CDC reports the number of registered dogs rose only 2 percent nationwide from 1986 to 1994. But the number of reported bites increased 37 percent over the same period.

"There is a lot of breeds of dogs out there. It's just those particular breeds that seem to be causing the headaches," said Joe Gibson, a partner of SFI Insurance Services, an independent brokerage in Redding.

Gibson recalled a recent phone conversation his office had with a woman who had five pet pit bulls and wanted home insurance.

"We told her the only way we could sell her insurance was if she didn't have those pit bulls. She said she would have to make a decision," Gibson said.

Most, if not all, mortgage companies will not allow escrow without homeowners insurance.

SFI Insurance works with six different companies that offer home insurance. None provides coverage to homeowners with certain breeds, including chows, pit bulls and Rottweilers.

Annual claims insurers paid on dog bites rose from $250 million in 1997 to $310 million in 2001, industry numbers show.

State Farm Insurance, the largest insurer of homes in California, paid out $13.4 million for dog-bite claims in 2001. Nationwide, the company doled out $82 million for dog-bite claims in 2001, up from $74.3 million in 2000.

State Farm in California doesn't discriminate against breeds. Instead, the insurance giant looks at the pet's history before making a decision on homeowners coverage.

The insurance industry estimates that dog attacks account for one-third of liability claims on homeowner policies.

"Those are pretty powerful statistics," Allstate Insurance Co. spokesman Lisa Wanamaker said from Sacramento.

The tightening of underwriting guidelines for dog owners is another example of homeowners insurance companies looking at areas to save money in California.

Over the past decade, homeowners insurance companies have paid out about $1.20 in claims for every $1 they collect. A huge portion of the claims paid out stems from water damage.

"In a tight homeowners market, we have to become stricter to reduce our liability in order to protect our current customers," Wanamaker said.

In addition to money, recent much-publicized killings have motivated insurance companies to toughen their underwriting guidelines, Gibson said.

In February 2002, a 6-year-old Red Bluff boy was mauled to death by two Rottweiler-pug mixes. In January 2001, a San Francisco woman was mauled to death by two Presa Canarios.

But the American Veterinary Medical Association says singling out specific breeds isn't a sensible solution.

Association spokeswoman Sharon Granskog said blacklisting dogs can create a false sense of security. She believes there are good dogs and bad dogs within every breed.

"It's a matter of responsible ownership and socializing and training the dog correctly," Granskog said from Schaumburg, Ill.

Bill Wilson, spokesman for the Independent Insurance Agents and Brokers of America, suggests homeowners check with their insurance carriers before getting a dog.

"It's like being torn between two or three models of cars. There's often a huge difference in the cost of car insurance depending on the model, but nobody ever takes the time to check it out," Wilson said from Hendersonville, Tenn.

If you do own a dog that's been blacklisted by one insurance company, Wilson says, it's important to shop around.

"If you deal with a broker or independent agent, they will represent more than one company. They might represent a company that doesn't care about the breed," he said.

Redding real estate agent Brad Garbutt said he has never had a pooch derail a home transaction.

"Usually they (the buyers) can find insurance somewhere. It may be with a subprime carrier," said Garbutt, past president of the Shasta County Association of Realtors.