Complete guide to insurance for new dog owners

Does homeowners insurance cover pets?

Yes. Homeowners liability insurance covers medical bills, legal costs and repairs when your dog injures someone or damages another person’s belongings. Coverage applies both on your property and away from home. It does not cover damage your dog causes to your own house, furniture or other property, or injuries to you or your household members. Renters insurance provides the same type of coverage.

"If you own a dog, you must read the personal liability section and you must look at the exclusionsItems that are specifically denied coverage under the terms of an insurance policy. For example, most auto insurance policies exclude coverage for normal wear and tear, drag racing and intentional acts.; those are two different sections," says Kenneth M. Phillips, a California lawyer who specializes in dog-bite cases. "It is becoming more and more of an occurrence for insurance companies to exclude coverage for injuries caused by an animal."

Check under "exclusions" for breeds the insurer either won't cover, or requires individual approval to cover due to a propensity for aggression. These may include pit bulls, Rottweilers, German Shepherds, Akitas, Chows, wolf hybrids, bull terriers and Presa Canarios.

Homeowner insurance limits on pets

Homeowner insurance policies typically provide between $100,000 and $300,000 in liability coverage on a standard policy. But, again, don't assume those apply to the pet -- read carefully for any mention of limits.

Phillips had a client who'd been bitten by a friend's dog. "No problem," the dog's owner had said. "I have $300,000 in liability coverage." But the owner's insurer pointed her to a little clause she'd overlooked: when it came to incidents involving the dog, coverage was only for $50,000.

The medical and other bills exceeded that amount, as can often be the case. Damages can include legal costs, emotional and physical pain, and loss of future wages and enjoyment.

"We had to go after the woman individually to pay," Phillips says. "She was shocked. She hired a lawyer, said, 'I bought a $300,000 policy.' The lawyer said, 'Sorry, you should have read it.'"

Some companies won't exclude breeds outright, or are prohibited by state law from doing so. But they may require the owner to submit behavioral evaluations, and will likely cancel coverage following an incident.

"You're always going to need to check with your carrierAn insurance carrier is the company that provides your car insurance policy and pays claims.," says Paul Vames, a lawyer in Hillsboro, Oregon. "Certain breeds require a vicious-breed rider, or endorsement. . . . You need to let the insurance company know you have that kind of breed."

Do you need an umbrella insurance policy if you own a pet?

An umbrella policy is a good idea if you have a lot of assets to protect and a dog claim could exceed your home or renters liability limit. It adds liability protection after the underlying policy reaches its limit. Confirm that the umbrella covers dog-related claims because an exclusion in the home policy can also create a coverage gap.

Phillips recommends that anyone with a dog, particularly a medium or large dog or a high-risk breed, buy an umbrella policy.

"It's going to cost you under $100 and it's going to get you $1 million coverage," he says. "And the person who gets hurt by your dog is going to be your niece, or your friend's son, or your neighbor."

Does auto insurance provide coverage for your dog?

Standard auto insurance does not include coverage for a dog injured inside your car. If another driver caused the crash, that driver’s property damage liability will cover eligible losses under state law. If you caused the crash, you need pet-injury coverage or pet insurance to help with vet bills..

In response to this gap, some auto insurance companies have begun offering drivers separate pet-injury insurance, so if you are interested in getting such coverage, be sure to ask about it when you compare auto insurance companies.

Progressive kicked off the trend in 2007, and its coverage is automatically included in collision, paying up to $1,000 for a pet injured due to an accident, fire or theft. Others are doing the same, including Erie and Auto-Owners.

"Pets are part of your family," Progressive states, "they're your passengers, too. So shouldn't they be covered by your auto insurance policy? We think so."

Several other companies offer what Arbella Mutual Insurance calls a "pet lover's endorsement," which for $20 a year buys you $500 in coverage. The Chubb Group offers $2,000 worth of pet-injury coverage. Always check the fine print to make sure your particular pet is covered, particularly if it's an exotic animal.

Of course, the question remains as to whether $500, or even $2,000, will be enough. As anyone with pets knows, vet bills can easily run higher. Which leads to the question that may most haunt new pet owners: is pet health insurance worth the cost?

Veterinary insurance: Don't expect an immediate return

Pet insurance reimburses part of your dog’s eligible veterinary bills. Accident-and-illness plans can cover injuries, infections, cancer, tests, surgery and emergency care. Accident-only plans cost less but exclude illnesses. Wellness care requires a plan or add-on that covers routine services such as vaccines and checkups.

Those in the industry say clients and the media often ask whether pet insurance guarantees an immediate return on investment. They then do the math on an annual basis. By this calculation, the answer is typically "no."

Pet insurance generally costs between $300 and $500 per year, depending on the company and the benefit plan. As with people's health insurance, plans offer varying deductibles and co-pays, as well as treatment maximums and annual limits.

"In an ideal world, we wouldn't need pet insurance because we'd put money aside every month," says Kristen Lynch, executive director of the North American Pet Health Insurance Association. "But we don't live in an ideal world."

"The whole point of insurance is to pool your capital so when you're not claiming it, other people can," she says. Meanwhile, you have bought peace of mind, knowing the money's there when you need it.

"In an emergency situation, having insurance can take away the sting of an unexpected cost concerning a pet's health," says Dr. Steven Rowell, director of the emergency hospital at Tufts University Cummings School of Veterinary Medicine.

How to transport your dog in your car safely

Keep your dog restrained in the back seat with a secured crate or vehicle safety harness. A loose dog can distract the driver and suffer severe injury in a crash. The AVMA advises against loose travel and recommends a secured enclosure or a properly designed pet safety harness.

"In the event of a crash, your pet becomes a missile in the car," AAA spokeswoman Heather Hunter says.

Safety experts say this fact often comes as a great surprise to pet owners, nearly one in five of whom let small dogs crawl on their laps. Here are some others:

Any size dog can easily be killed by the massive force of an airbag. If a small dog is on someone’s lap, that explosive force will not only crush the dog but can severely injure the person behind it. Dogs should ride in the back.
After an accident, a loose, frightened dog will run. Stories abound of dogs struck and killed by another car, or causing other cars to swerve and crash. If your dog causes another accident, your homeowner's and auto insurance may try to deny coverage.
In an accident, where owners and dog alike may be injured, even a friendly dog is likely to bite rescue workers who reach their hands inside. It is not the dog’s fault. Its protective instinct simply takes over.

Although harnesses failed crash tests in the past, modern car harnesses work much better. Ensure you are choosing one that has been crash-tested and is the right size for your dog's weight.

If you keep your dog in the cargo section of an SUV or minivan, use a kennel or a guard between it and the back seats to keep the dog safely in the back.

FAQ: Insurance for dog owners

Does renters insurance cover dog bites?

Yes. Renters liability insurance covers medical bills, legal expenses and property damage after a covered dog bite or other injury. The policy may exclude specific dogs, prior incidents or animal claims. Tell the insurer about your dog and review the liability limit before relying on the coverage.

Can a home insurer deny coverage because of a dog’s breed?

Yes. An insurer can restrict, exclude or deny coverage for some dogs where state law allows it. Other companies review the dog’s behavior and bite history instead of its breed. Ask before buying or renewing a policy, and request written confirmation that your dog has liability coverage.

Does homeowners insurance cover my dog’s vet bills?

No. Homeowners insurance does not pay for your dog’s illness treatment or accident-related vet bills. Pet insurance covers eligible veterinary costs as outlined in the policy. Home liability coverage instead protects you when your dog injures another person, animal or someone else’s property.

Does car insurance cover a dog injured in a crash?

No, not on most policies. Some auto insurers offer limited pet-injury coverage with collision insurance, but standard policies don’t include it. For example, Progressive covers up to $1,000 in vet bills if your pet is injured in a covered crash. Check your limit, deductible and covered events, and consider pet insurance for broader protection.

Is pet insurance worth it for a new dog?

Yes, pet insurance is worth it if a large emergency vet bill would strain your budget. Buying coverage when the dog is young can reduce the risk of pre-existing condition exclusions. Compare the premium, deductible, reimbursement rate, annual limit and exclusions before choosing a plan.