It may not be a stretch to say that your dog contributed to the injuries even if it cannot be definitively shown that your dog did the biting.
Remember, civil court is about the preponderance of the evidence, not guilt beyond a reasonable doubt. My guess is that your insurance will settle without going to trial as it will probably be cheaper to pay off the damages then it would be to go to trial and prevail.
Even if on a leash, if you lost control of your dog that could place you in the loser's circle on that one. That does not mean you are evil or did anything unreasonable, just that you will likely be seen as liable.
So, contact your insurance company and advise them of the claim. If you are cited for violating some ordinance, then do not miss the assigned court date.

