How to Review Your Homeowners Insurance Renewal Statement

For most of us, our home is our single largest and most important investment. Many of us have poured thousands of dollars and countless hours into maintaining, improving and (hopefully) paying off our homes. Many people own their homes free of any mortgage. These assets are pure equity. Certainly its worthwhile to invest 15 minutes a year to be sure it's properly insured.

Thankfully, the insurance company offers you a perfect reminder and opportunity in sending out your annual renewal statement. Even if your insurance is paid by your mortgage company as part of your impound account, the insurance company still mails you a statement of renewal every year to update you with your current coverage limits and deductible.

Here's a few important steps you can take to be sure that HOME SWEET HOME is properly protected.

1. Check the basics. Check your name, address and any other description of the insured property. Make sure there's been no change of vesting or ownership that needs to be updated. Check your address to be sure no numbers are transposed.

2. Check the mortgagee clause. Here's where you can be sure that the current mortagee on your home is listed correctly. Check the lender, address and your loan number. Be sure there's no old information there. Maybe you had a HELOC (Home Equity Line of Credit) or a second mortgage that no longer applies. Be sure to get them removed.

HEADS UP: Whenever you have a significant claim, the mortgage company will be one of the payees on your claim settlement check. Just that alone can be an inconvenience. But it becomes a major hassle when one of the institutions listed no longer has a vested interest in your home. The insurance company is bound by contract to include the mortgage company on all settlement checks beyond a stated threshold.

*3. Check the coverage on your home (dwelling or building). This is without question the single most important coverage to examine, consider and adjust whenever necessary. Having been an agent during the two raging firestorms in San Diego, CA in this decade, I can tell you that underinsured homes are just NO FUN! Two of my clients lost their homes in the 2003 fires and fortunately they were both adequately insured. (we call all our homeowner clients once a year to review their coverages and suggest improvements and adjustments) But I can tell you that there were literally hundreds of people in the area that were not so fortunate. Many were underinsured by over $100,000! Contractors were giving rebuilding bids on homes for $400,000 with insurance policies with limits less than $300,000. See if that doesn't tweak your financial well-being just a little. Here's the solution.

Get an accurate rendering of the square footage of your home. Check county records, take a look at zillow.com, call your favorite Realtor, or get a tape measure and do your thing. Usually you don't include the garage in this calculation. Once you get your square footage, then you need to determine the building cost per square foot in your area for a home like yours. Call a local contractor for a quick estimate or you can call your insurance agent. Average costs in San Diego run about $200 per square foot. With that, a 2000 square foot would take about $400,000 to rebuild. Custom homes can be significantlly more. For a more complete discussion of this, check out: How Much Homeowners Insurance Do You REALLY Need?

Your contents coverage is usually 75% of the amount you have on your home. For example, if you have $400,000 on your home, you'll have an additional $300,000 to cover your personal property (furniture, clothing, dishes, TV, collections, shoes, tools, etc) Usually this is enough, but think through it anyway. If you have antiques, art, collections of any kind then you may need more. Ask your agent for help if you need to.

4. Look at your Personal Liability Coverage. This is the coverage you need when you get sued. Little Johnny runs across your front yard and trips on one of your sprinklers and ruins his chances to become America's Next Top Model and his parents sue your for $250,000. Make sure you don't scrimp here. It's not too expensive to get $500,000 or even $1 Million of liability coverage. If you have $100,000 or less, you could be setting yourself up for a mess just waiting to happen. Put a really big checkbook between your assets and someone who sees an injury as a lifetime paycheck. You might even consider a Liability Umbrella.

5. Check your 'special limits'. This is a REALLY BROAD subject that I just can't do justice to here in this post. Simply stated, there's limits on many things such as cash, computers, cameras, jewelry, furs, goldware, silverware, tools, etc. Call your company and ask for a review. You can increase many of these limits for just a few dollars a year. Sometimes the available increase isn't enough. That's the perfect time to consider a Personal Articles Floater (or it's called many different names) It's a policy that's designed to place stated amounts of coverage on many items from jewelry, business tools, iPods, hearing aids, cameras, musical instruments and on and on. If you have more than 'the average Joe' of ANYTHING, then check this out FOR SURE!

6. Check your deductible! This can be a tremendous cost-control tool in your insurance spending. Simply stated: The larger your deductible, the greater your savings. Usually you can save close to $100 per year just by going from a $500 deductible to $1000. Pick the largest number you can stand without losing sleep at night and ask your agent or company the savings you'd realize by changing. If you have a $250 or smaller deductible, it's definitely time to change it UP! Keep in mind that you usually hit a point of 'diminishing returns' once you get to $4000 or more. This means that you'll save less and less for each additional $1000 you choose. It might make sense to go from $1000 to $2000 if you save $85 a year by doing so, but not from $5000 to $6000 if you only save another $21 by making that jump.

Monitoring your insurance costs and coverages can result in a lot of savings AND peace of mind. Be sure you keep notes and file your thoughts and changes from year to year. These recoreds will make your annual call quicker and easier each year.

Feel free to contact me anytime if you have questions.

Till next time...


It's a Good Life !

Saturated Fat and Insulin Sensitivity

Insulin sensitivity is a measure of the tissue response to insulin. Typically, it refers to insulin's ability to cause tissues to absorb glucose from the blood. A loss of insulin sensitivity, also called insulin resistance, is a core part of the metabolic disorder that affects many people in industrial nations.

I don't know how many times I've seen the claim in journal articles and on the internet that saturated fat reduces insulin sensitivity. The idea is that saturated fat reduces the body's ability to handle glucose effectively, placing people on the road to diabetes, obesity and heart disease. Given the "selective citation disorder" that plagues the diet-health literature, perhaps this particular claim deserves a closer look.

The Evidence

I found a review article from 2008 that addressed this question (1). I like this review because it only includes high-quality trials that used reliable methods of determining insulin sensitivity*.

On to the meat of it. There were 5 studies in which non-diabetic people were fed diets rich in saturated fat, and compared with a group eating a diet rich in monounsaturated (like olive oil) or polyunsaturated (like corn oil) fat. They ranged in duration from one week to 3 months. Four of the five studies found that fat quality did not affect insulin sensitivity, including one of the 3-month studies.

The fifth study, which is the one that's nearly always cited in the diet-health literature, requires some discussion. This was the KANWU study (2). Over the course of three months, investigators fed 163 volunteers a diet rich in either saturated fat or monounsaturated fat.

The SAFA diet included butter and a table margarine containing a relatively high proportion of SAFAs. The MUFA diet included a spread and a margarine containing high proportions of oleic acid derived from high-oleic sunflower oil and negligible amounts of trans fatty acids and n-3 fatty acids and olive oil.

Yummy. After three months of these diets, there was no significant difference in insulin sensitivity between the saturated fat group and the monounsaturated fat group. Yes, you read that right. Even the study that's selectively cited as evidence that saturated fat causes insulin resistance found no significant difference between the diets. You might not get this by reading the misleading abstract. I'll be generous and acknowledge that the (small) difference was almost statistically significant (p = 0.053).

What the authors decided to focus on instead is the fact that insulin sensitivity declined slightly but significantly on the saturated fat diet compared with the pre-diet baseline. That's why this study is cited as evidence that saturated fat impairs insulin sensitivity. But anyone who has a basic science background will see where this reasoning is flawed (warning: nerd attack. skip the rest of the paragraph if you're not interested). You need a control group for comparison, to take into account normal fluctuations caused by such things as the season, eating mostly cafeteria food, and having a doctor hooking you up to machines. That control group was the group eating monounsaturated fat. The comparison between diet groups was the 'primary outcome', in statistics lingo. That's the comparison that matters, and it wasn't significant. To interpret the study otherwise is to ignore the basic conventions of statistics, which the authors were happy to do. There's a name for it: 'moving the goalpost'. The reviewers shouldn't have let this kind of shenanigans slide.

So we have five studies through 2008, none of which support the idea that saturated fat reduces insulin sensitivity in non-diabetics. Since the review paper was published, I know of one subsequent study that asked the same question (3). Susan J. van Dijk and colleagues fed volunteers with abdominal overweight (beer gut) a diet rich in either saturated fat or monounsaturated fat. I e-mailed the senior author and she said the saturated fat diet was "mostly butter". The specific fats used in the diets weren't mentioned anywhere in the paper, which is a major omission**. In any case, after 8 weeks, insulin sensitivity was virtually identical between the two groups. This study appeared well controlled and used the gold standard method for assessing insulin sensitivity, called the euglycemic-hyperinsulinemic clamp technique***.

The evidence from controlled trials is rather consistent that saturated fat has no appreciable effect on insulin sensitivity.

Why Are We so Focused on Saturated Fat?

Answer: because it's the nutrient everyone loves to hate. As an exercise in completeness, I'm going to mention three dietary factors that actually reduce insulin sensitivity, and get a lot less air time than saturated fat.

#1: Caffeine. That's right, controlled trials show that your favorite murky beverage reduces insulin sensitivity (4, 5). Is it actually relevant to real life? I doubt it. The doses used were large and the studies short-term.

#2: Magnesium deficiency. A low-magnesium diet reduced insulin sensitivity by 25% over the course of three weeks (6). I think this is probably relevant to long-term insulin sensitivity and overall health, although it would be good to have longer-term data. Magnesium deficiency is widespread in industrial nations, due to our over-reliance on refined foods such as sugar, white flour and oils.

#3: Sugar. Fructose reduces insulin sensitivity in humans, along with many other harmful effects (7).

As long as we continue to focus our energy on indicting saturated fat, it will continue distracting us from the real causes of disease.


* For the nerds: euglycemic-hyperinsulinemic clamp (the gold standard), insulin suppression test, or intravenous glucose tolerance test with Minimal Model. They didn't include studies that reported HOMA as their only measure, because it's not very accurate.

** There's this idea that pervades the diet-health literature that all saturated fats are roughly equivalent, all monounsaturated fats are equivalent, etc., therefore it doesn't matter what the source was. This is beyond absurd and reflects our cultural obsession with saturated fat. It really irks me that the reviewers didn't demand this information.

*** They did find that markers of inflammation in fat tissue were higher after the saturated fat diet.