you need to establish yourself as a confident pack leader.
every human in the household should be seen as a leader, or in a high rank than the dog.
you can do this by first creating trust between you and your dog. by walking your dog EVERY DAY for at LEAST half an hour, your dog will quickly learn to trust you (check out my hub about how to successfully walk your dog & be seen as the pack leader while doing so).
after you create trust in this way, it will be much easier to rehabilitate your dog. still, rehabilitating a fearful dog can be difficult. make sure that when you have visitors you let them know BEFORE they come inside to not touch, talk or give eye contact to the dog. this will make your dog feel less intimidated by the strangers and will greatly lower the chances of anyone getting bitten.
you should definately watch cesar millan's show "Dog Whisperer" on national geographic channel, he confronts many dogs and owners with this same issue.
if you don't see some progress, your best bet is to confront a professional who will not make the problem worse, research a professional dog behavior specialist and research them well!
the last thing you want is to have the situation worsen because of an ill educated "professional".