Earlier this month, New York became the latest state to place restrictions on insurance carriers' ability to limit or deny homeowners insurance coverage based on ownership of specific dog breeds. The legislative package, signed into law by New York Governor Kathy Hochul, prohibits insurers from refusing to issue or renew, cancel or charge an increased premium for certain policies based solely on the breed of dog owned.

“To own a pet is a blessing and we owe it to the animals of New York to keep them safe and healthy," Hochul said in a press release issued by her office. “Dogs of all breeds deserve loving homes and no one should have to fear losing their insurance coverage based on the dog they own."

This past year has seen other state legislatures rolling back insurance restrictions on dog breeds deemed aggressive. New York was the third state since June to implement laws, with Nevada and Illinois also recently forbidding or taking steps to limit the use of dog breed in home insurance.

Mark Friedlander, head of corporate communications for the Insurance Information Institute (III), predicts that New York's legislation could result in homeowners across the state “paying a higher premium to subsidize the few homeowners with aggressive dogs," he told Money.com. 

Friedlander said that since any rate changes would need to be approved by state regulators, no one can yet predict the rate increases for the average insured homeowner. “Each company that writes homeowners insurance in New York will need to reassess its underwriting risk to determine if a statewide premium increase is warranted based on the new dog breed regulations," he said.

Legislation passed in Nevada prohibits the use of a dog's breed to deny coverage or charge higher premiums. Mark Sektnan, vice president of the American Property-Casualty Insurance Association, expressed concern. “If insurers are forced to insure those homeowners with an increased risk, whether that's a leaky roof, an inadequate stove or an aggressive dog, they must be able to charge an adequate rate," he said.

Nevada's law does allow carriers to ask questions, as Ledy VanKavage, senior legislative attorney for animal group Best Friends, notes. “Has the dog ever bitten anybody? Have there been complaints about the dog? Has the dog been deemed dangerous or vicious? Those are valid concerns. And we think that should be the focus of insurance companies."

Despite 21% of homeowners reporting adopting a dog in 2020, the number of homeowners dog bite claims fell by 4.6% in 2020, according to the Insurance Research Council. However, while the overall number of claims decreased, the total cost of claims increased by 7.1% to $853.7 million, up from $796.8 million in 2019. And the average cost per claim increased 12.3% to $50,245, up from $44,760 in 2019.

While an umbrella policy or pet liability coverage is a potential solution, risk mitigation measures, such as behavioral training and responsible pet ownership practices, should also be considered.

AnneMarie McPherson is IA news editor.