Liability - Dog Bites, Mold and Cars

There are not that many times that you can have liability just because you own something, but that can occur if you own a car, a house, or a dog.

In Michigan, the owner of a car has liability for injuries caused by that car, whether the owner is driving or not. If the owner is an individual, then the injured party can only recover from individual assets if that party gets a judgment of liability. They cannot recover from a jointly owned house, bank account, or other joint asset.

If the owner of the car is actually two or more individuals, and if those two individuals have joint assets, then the injured party can recover from the joint assets after obtaining a judgment of liability. As a result, you are well advised to have your car titled in your individual name so that an injured party cannot recover from any assets of yours that are held jointly (such as a house and all the equity you might have in the house). Making sure your car is titled in your name only is a way to “judgment-proof” yourself.

Additionally, if there is a young driver in your house, be sure that the car is titled in the name of that young driver and not you. If not, then your own assets are exposed to damages caused by the young person instead of limiting the injured party to collecting from the young person alone.

If you own a house, that is another way to have liability. If someone slips and falls at your house or is injured there, you can have liability based on whether the person came to do work there (like a plumber) or came to a holiday party (as a guest). You have different exposure to damages based on the “status” of the visitor.

Black mold in the house presents another issue because YOU may be the injured party. In days gone by, insurance companies would cover damage from mold. After the courts began to be deluged by black mold cases, however, the insurance companies started to exclude mold coverage unless you paid an extra premium for an “endorsement” or rider to your policy. Be sure to ask your agent about whether your current policy excludes mold coverage.

On a last note, if you own a dog you will have liability for anyone the dog bites. In the past, you could avoid liability for dog bites if you had no knowledge that your dog might actually bite someone. The Michigan Legislature abolished that “one free bite rule” and imposed liability on dog owners for all bites except those where the injured party provoked the dog. Like the mold problem, insurance companies decided to exclude dog bite coverage unless you paid an extra premium for an “endorsement” or order to your policy. As you can imagine, poodle coverage is cheaper than pit bull coverage—so keep that in mind as you decide on a breed, and call your insurance agent to determine the coverage available.