Insurer Refuses Coverage for Ga. HOA in $10M Dog Attack Case

Auto-Owners Insurance Co. has asked a Georgia federal court to confirm it is not obligated to defend or indemnify Chestnut Homeowners Association Inc. in a lawsuit seeking over $10 million in damages. The underlying litigation, filed by plaintiff Sadie Bispham, alleges that the HOA’s failure to enforce community animal regulations contributed to a violent dog attack in November 2023.

Bispham, who suffered life-threatening injuries during the attack by her neighbor’s four dogs, claims she spent more than a month hospitalized and accumulated over $1 million in medical expenses. In an amended complaint filed in February 2025, Bispham asserts that Chestnut negligently failed to regulate its member properties by not enforcing animal-related covenants.

The Insurer’s Position

In its complaint filed Wednesday, Auto-Owners argued that Bispham’s allegations do not constitute an "occurrence" under Georgia law, thus falling outside the scope of its commercial general liability policy issued to the HOA. Although Auto-Owners is currently providing Chestnut with a defense under a reservation of rights, the insurer insists that no duty to cover the claims exists.

In a March 2025 reservation of rights letter, Auto-Owners highlighted that the neighbor allegedly intended for the dogs to roam off the property, potentially excluding the incident from the definition of an accident under the policy. Additionally, the insurer pointed to a significant delay in notification: despite the attack occurring in November 2023, Auto-Owners did not receive notice until July 2024.

"Any liability for any 'bodily injury' alleged in the underlying amended complaint was assumed by Chestnut via a contract which is not an 'insured contract,’" Auto-Owners stated, referencing the HOA’s governing covenants.

The Potential for Coverage Issues

Auto-Owners’ position raises multiple coverage defenses:

• Lack of an “Occurrence”: Auto-Owners contends that intentional acts leading to injury are not accidental under Georgia law.
• Notice Failure: The policy’s notice requirements, deemed a condition precedent to coverage, were allegedly violated.
• Contractual Liability: The HOA’s obligations under its covenants do not qualify as an insured contract under the policy, removing another potential pathway for coverage.

Because of these defenses, the insurer seeks a declaratory judgment confirming no obligation to defend or indemnify Chestnut in the underlying suit.

The Lawsuit's Status

Sadie Bispham’s underlying personal injury case, pending in Georgia state court, demands over $10 million in damages tied to the alleged negligence of both the neighbor and the HOA. Chestnut's liability largely hinges on its enforcement, or lack thereof, of animal restrictions within the community.

Neither Bispham’s attorneys nor representatives of Chestnut Homeowners Association immediately responded to media inquiries.

The Firms Involved

Auto-Owners Insurance Co. is represented by Bovis Kyle Burch & Medlin LLC attorneys Kim M. Jackson and Anthony "Chris" Stastny. Counsel for Sadie Bispham and Chestnut HOA has not yet been disclosed.

The case is Auto-Owners Insurance Co. v. Bispham et al., Case No. 1:25-cv-02238, pending in the U.S. District Court for the Northern District of Georgia.