^^I don't agree that you should allow and/or encourage such behavior. Even if in "dog world" hugging is considered rude. Dogs also think pooping and peeing wherever, jumping on people, and stealing food is okay and normal in their world but dogs are domesticated and live with humans and have to be taught certain things are NOT ok.
I would suggest clicker training/positive reinforcement for a situation such as this. You can Google "clicker training" of watch YouTube vids of kikopup and zakgeorge21 to see a few training videos.
If he growls or tries to bite anyone while he's on your lap, take him OFF of your lap or bed immediately. Do not pet, stroke, or 'reward' him in any way for this behavior. I notice so many people (including my father) when their dog is growling while on their lap and clearly stressed, they will pet her and try to 'relax' her when in reality, they are reinforcing the behavior. Maybe even keep him on a leash and the minute he growls or bites it's a firm 'ah-ah' and take him out of the room, then bring him back when he's good again. This method is shown quite a bit on 'It's Me or the Dog' on Animal Planet. I don't always think this method is the most useful but in your case, I do think it would come in handy.
Have your husband be the treat giver, food feeder, walker, toy player, everything good! So the dog sees your husband=food, treats, toys and fun!
Also, obedience training never hurts! Basic commands (sit, stay, down, come) and even fun tricks can boost a dogs confidence and can make them more well behaved dogs.
Good luck, hope this helps a bit
