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Homeowners insurance is going to the dogs

Man's best friend may be your homeowners insurance policy's worst enemy.

Some insurance companies are refusing to write or renew policies for homeowners who own certain breeds of dog. Dog owners are calling it a case of canine profiling.

Dog lovers say the uninsurable breed system isn't fair or scientific since any dog can be aggressive and bite. In fact, dog owners argue, many breeds on the outlaw list are as kind, gentle and no more apt to bite than your average dog. A handful of insurers agree that it's difficult to make blanket judgments about breeds, but they ask dog owners to pay more or cancel policies for homeowners who have dogs with a history of biting.

Insurance companies say they're only trying to reduce costs and are only eliminating coverage for breeds known to have high bite rates. Several high-profile dog mauling cases, such as the fatal attack on a San Francisco woman by two Presa Canarios in 2001, have increased safety -- and insurance -- concerns.

Most of the breeds that concern the insurance industry are large canines that can inflict a lot of damage. About 25 breeds of dogs were involved in 238 fatal dog bites, according to a 20-year study conducted by the Centers for Disease Control and Prevention and published in 2000. According to the report, pit bulls and Rottweilers were involved in more than half of the fatalities resulting from dog bites. Those two breeds have joined several others on the industry's "bad dog" list.

Money motivation
Most consumer advocates (and some insurance industry observers) believe that money is at the root of the price hikes and coverage limits. Insurance companies are cracking down as they face rising costs.

"The cost of dog liability for insurance companies has been rising steadily for 10 years," says Alejandra Soto, spokeswoman for the Insurance Information Institute, a trade group based in New York City. "It hasn't risen dramatically, but it is continuing to rise and insurers view it as a problem."

The Insurance Information Institute estimates that the industry paid out $317.2 million in 2005 dog bite liability claims, compared to $250 million in 1996. Combine that rise with the overall increase in costly claims and lawsuits for everything from toxic mold to natural disasters, and insurance companies are looking for ways to cut costs or boost revenue.

Blacklisting breeds
Insurance carriers see two ways to solve the canine conundrum.

The first is to refuse coverage for certain breeds. The Columbus, Ohio-based Nationwide Mutual Insurance Company's criteria is typical. The company compiled its list of breeds to ban based on frequency of dog bites, the reputation of the breed, the insurance company's own research and information from the CDC. Nationwide has deemed Rottweilers, Dobermans, pit bulls, Presa Canarios, Chows, wolf hybrids and dogs trained for protection or attack ineligible for homeowner's coverage in addition to dogs with a previous bite record.

However, these dogs do have a chance to redeem themselves. In 2004, Nationwide instituted a stipulation that these dogs could potentially be covered by their homeowners insurance upon successful completion of the AKC Good Canine Citizen test.

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