"The rise in dog bite claims over the course of the past five years can be attributable to the increased medical costs as well as the size of settlements, judgments and jury awards, which have risen well above inflation in recent years," according to Loretta Worters, vice president of the I.I.I.

The Institute noted that more than 4.5 million people in the United States are bitten by dogs annually, and nearly 900,000 of those--half of them children--require medical care, according to figures from the Centers for Disease Control and Prevention.

More than 31,000 Americans needed reconstructive surgery after dogs attacked them in 2006, CDC figures show. With more than 50 percent of bites occurring on the dog owner's property, the issue is a major source of concern for insurers, the Institute noted.

The I.I.I. mentioned that in some states, the owner is not held liable for the first bite the dog inflicts. Once an animal has demonstrated vicious behavior, such as biting or otherwise displaying a "vicious propensity," the owner can be held liable.

However, some states, I.I.I. noted, have moved away from the one-bite rule, and hold owners responsible for any injury, regardless of whether the animal has previously bitten someone.

"Although some people purchase dogs for the purpose of guarding their homes, deadbolt locks and home security systems are safe burglary deterrents and that will often earn you a discount on your insurance premium," said Ms. Worters.

According to experts knowledgeable in the field, dog bite claims generally result in big verdicts because juries are sympathetic with the injured victims, due to the fact they are frequently children.