If you've been in a house for 5 years or longer, chances are you may be grossly underinsured for homeowner's coverage. In fact, you'll only discover it after a catastrophic loss when it's too late.

So you must read the coverage limits when your policy comes up for renewal every year. Let your insurer know if there's no way you could rebuild your house for the specified amount. Note the name of the rep you speak to and the date/time of the call. That way if your insurer refuses to raise your limits and a catastrophic loss happens, you've already begun building a case against them.

Clark's insurer would not raise his limits, so he triggered a clause in his contract and got a 3rd party appraiser to look at his home. The insurer accepted the appraisal and then complied by raising his coverage.

The chances of a catastrophic loss are minimal, but why take the chance of having your wallet disrupted just as terribly as your life in the case of the unthinkable?

Clark recently bought a foreclosure in a mountain community. In this case, the insurer sent an appraiser out to him and told Clark he needed more insurance because of the expense of rebuilding on a mountain.

The penny-pincher always takes big deductibles so he doesn't get hurt much. Don't have the $500 deductible of yesteryear. Today, insurance can only be used in the case of a catastrophic loss. It's a "use it and lose it" proposition. Clark saved 31% on his last renewal by having a higher deductible.

Meanwhile, Fireman's Fund has a rider that allows you to rebuild your house as an energy-efficient structure in the event of a catastrophic loss. The San Francisco Chronicle reports that it only costs the average homeowner about $70 more for this policy. There are also other insurers doing these "green" riders. But this should not be treated as incentive to burn down your house just to get it rebuilt as an energy-efficient model!

Why do you buy home or auto insurance? You do it because if something goes wrong, the insurer is there to make it right -- be it repair your home, fix your car or replace it if stolen.

But some companies only do half the job. They take the premiums, but they aren't vey good about paying out claims. A trial lawyer's group called the American Association for Justice has come with a list of the worst insurers in America.

Topping the list as the single worst insurer is Allstate. This company once enjoyed a great reputation for customer service, but Consumer Reports also concurs in a separate tally that now they're way toward the bottom of the heap. In a J.D. Power survey, Allstate also gets the lowest score of any home insurer.

But this is not a bash on Allstate segment. Clark just wants you to keep in mind that cutesy TV ads do not a good insurer make.

The penny-pincher prefers to concentrate on those insurers that actually do a good job. Such elites typically include USAA and Amica Mutual.

USAA is open only to active military and those who have recently retired from the service. Clark has been a member for 30 years. During that time, his family had 3 claims (none of them major) and each time the service has been phenomenal. Christa, meanwhile, has been with Amica for 2 years now.

There is one other insurer that Clark knows has a great reputation. That's a small company called New Jersey Manufacturers Insurance, which has nosed out both USAA and Amica in some surveys.

The fallout from the recent California fires has exposed more ugliness for homeowners who've been facing evacuation, temporary homelessness and charred ruins. To add insult to injury, some 40 percent of homeowners may be ruined because they didn't have enough insurance on their homes, according to the California Department of Insurance. Several times a year Clark will advise homeowners to raise their insurance limits. It's one of those good ideas that most people never get around to doing. Say you purchased your home 10 years ago for $100,000. Now your home may be worth $250,000. But your insurance has not kept pace. So you'll be destroyed financially if you have a catastrophic loss. It gets even worse if you have a mortgage on the property. You can lose your home, be foreclosed upon and get sued by the lender for losses on the loan. Is Clark scaring you? That's his intention.

You need to have your homeowners insurance limits raised every 3-5 years -- even though it will raise your premiums. The scary thing is that the insurance company is not required to rebuild your home if you're grossly underinsured. Clark has been in his house for 11 years, and he's had to fight his insurer three times to get them to raise the insurance limits. An appraisal demonstrated that his home had greatly appreciated in value and needed to be better insured. But he still got pushback. Sometimes insurance companies are scared you'll torch your house for a financial gain. Do what you must to get your insurance limits raised. Don't end up like the California homeowners with no meaningful coverage and no way to rebuild their homes.

You can buy a video camera for about $130 these days. Those can be worth thousands of dollars if your house was to ever catch fire. Why? You can keep a video record of all the things that you have in your home. That videotape becomes an insurance policy for your insurance policy. Don't keep the videotape in your house. You’ll want to store it somewhere that is safe like at a relative’s house. You don't want your records to be burned up with your stuff. Also, jewelry and art are not covered under normal homeowner’s policies. So think about what you have and if you need extra coverage for those types of pieces in your home. Knowyourstuff.org is a good site for keeping records of all your possessions. Check it out. It is totally free and could help you save a lot.

Home owners' insurance prices are actually going down. The business is changing its pricing strategy. Computers have now made it possible to weigh hundreds of factors to price your policy. The price differences between different insurers can be huge because of their different systems of pricing. If you have a great credit score, haven’t had a claim in a while, and live in a relatively safe area you could save hundreds or even more each year just by switching companies. Also, you can raise your deductible to save money. This will keep you from making small claims and it will save you money every month on your premium.

Some insurance companies, when you call up and ask questions, will log it on your C.L.U.E. report. This is a tactic that makes other insurance companies not want to insure you. But, you can order your free C.L.U.E. report once a year just like you can with your credit report, and if something turns up false, challenge it. The website to go to in order to order your C.L.U.E. report is choicetrust.com. Fill in some blanks and you’ll have to give your social security number, but then you can check out your personal auto and your personal homeowners report. They do charge you if you need a homeowners report on more than one address.

The Supreme Court has just made a new ruling that insurers can check your credit report to determine your insurance rate. Insurance companies think that how you handle credit is a good indicator of how you will act with them. To make sure that you are ok, pull one of your free credit reports at annualcreditreport.com. Clean it up if there are strikes against you because you don’t want insurance companies hiking your rates when you could have prevented it.

Clark reads many newspapers each day, and he’s seen a pattern in stories over the past few weeks. First of all, auto insurance rates are going down at many companies. For example, State Farm, the country’s largest insurer is cutting rates by up to 23 percent in some states. Safeco is cutting rates by 20 percent and Farmer’s is knocking 15 percent off its rates. In addition, homeowner’s insurance rates are dropping, too. Insurance companies are moving into what’s called a “market share” cycle, when consumers benefit from insurance companies competing with each other. At the same time, teens are getting involved in fewer accidents because states have enacted graduated license laws. So, there will be much better opportunities to save on auto and homeowner’s insurance, so shop around!

Clark has been to the area hit by Hurricane Katrina three times since it hit, and nothing has changed. There has been essentially no progress, in part, because of the court fight over who should pay for the reconstruction. Insurers have said they are not responsible because storm surges aren’t covered by homeowner’s insurance. Meanwhile, government is stalling as well. One insurer, State Farm, has agreed to pay hundreds of millions of dollars in claims. That means that about about 40,000 will be able to appeal the denials they originally received. But the homeowner’s insurance system clearly needs to be revamped completely. Homeowner’s insurers are abandoning Florida all together because of predictions that storm activity is going to grow in Florida. The risk is just too high. So, in Florida, people must go to a state risk pool to buy homeowner’s insurance. That is basically the government doing private industry’s work. That begs the question: where do we need to go with this? Clark thinks we need is a unified policy system, where homeowner’s and flood insurance comes under the same title. That way, there is no finger pointing and blaming the other guy. The overall picture that Katrina smacked in our faces is that our system is haphazard and needs to be fixed.

A friend of Clark’s recently suffered a house fire that severely damaged his home. The house can be rebuilt, but it’s going to take a lot of time and money. So, he had tons of questions for Clark about what to do. The man had not documented what was in the house on video, as Clark often recommends. So, he had to go in afterward and try to get it on tape. The friend also wanted to know what he should expect from insurance companies when he files. Well, ahead of time you want to make sure your home is fully insured. If you’ve lived in your home for five years or longer, you’re probably underinsured for a catastrophic loss. That means that if something happens, insurers only cover the amount stated in the policy. They do not repair to “like condition,” as they used to. Insurers stick to the face amount of the policy, so in a major loss you could be paying a lot out of pocket. You want to insure you’re getting what you deserve for your possessions. If your insurance company isn’t measuring up in your opinion, you may want to consider a public adjuster. Adjusters are in the insurance industry and are well versed in giving estimates. Just make sure it’s legal to hire one in your state. The two best insurers out there today are usaa.com and amicamutual.com.

Insurance companies are now helping customers prevent and deal with ID theft. It's being called ID theft insurance. Learn more!

Clark has a Category 5 warning for you regarding your homeowner’s insurance. Insurers took quite a few losses last year with all of the hurricanes that hit. As a result, insurers are filing for rate increases all over the country, according to the Wall Street Journal. You could live in Wisconsin or Indiana - where hurricanes never hit – and you’ll find your insurance rates going up this year. That means that there is no better time to shop around for insurance. A good resource to consider for all types of insurance is insure.com. For car insurance, try company sites, including Geico, Progressive and AIG. Also, the number one auto insurance company is Amica Mutual, which you can check out at amica.com.

Syndicated financial writer Kathy Kristoff offers great advice for you regarding your money, but sometimes she doesn’t follow her own advice. Clark talked about her latest column, which details a recent fire in her neighborhood. She realized, as the fire approached her home, that she didn’t have a video of everything in the house, something she recommends people do for insurance purposes. So, now she’s done her video, and you should too. It is worth thousands of dollars in terms of making a claim and getting a good settlement from your insurance company. Just come up with a time each year to make the video.

Clark was excited to read a Reuters story recently about how to deal with insurance companies and adjusters. It’s especially important with hurricane season upon us. Adjusters can get very jaded in this business because so many people are trying to scam the system. So, the No. 1 suggestion is to be polite. If you get on the phone with an adjuster and start mouthing off, you will get nowhere. You can be polite and stay clear about what you want. Video taping your possessions and storing the tape in a fireproof safe is another great thing to do. It builds trust with the adjuster and is just a smart thing to do. Also, if you have a particular insurance agent, be sure to stay in contact with this person. He or she can be a great ally. Also keep in mind that insurance companies are regulated by states. If you’re having trouble with a company, contact the state insurance department. Don’t wait too long. You want to call as soon as you get signals that the insurer is going to be difficult.

Do you have flood insurance? Do you need it? Many people who are now homeless in New Orleans did not have flood insurance because no one required it there. In fact, the Army Corps of Engineers assured residents that they were in a flood safe area because of the levees around the city. They were misled and you may be as well.

Many people also think their homeowner’s insurance includes flood insurance, but it does not. In rapidly growing suburban areas, more floods are occurring. As trees get knocked down and asphalt goes up, water more easily flows to low points.

Development is not evil. That’s not what Clark is trying to say. We’re approaching 300 million people in United States, and people have to live somewhere. But people need to protect those homes. Right now, less than half of people who live in flooded areas have flood insurance, according to Smart Money magazine. And flood maps are not always up to date.

So consider getting flood insurance even if you don’t’ think you need it. It will cost $30 to $40 a month more. But think of what would happen if a hurricane hit your town. Get the peace of mind. And if you’re a renter, be sure to get renters insurance. It’s cheap and it’s worth it.

There is a new gimmick going around the insurance business that Clark is not sure about. He’s been trying to figure out if it’s a deal or not. Basically, you buy an all-in-one policy that includes auto, homeowner’s and life insurance. Metlife calls its plan “Grand Protect” while AllState calls its “Encompass.” Companies have been rolling them out state by state, so some newspapers have started looking into them. Turns out that these plans cost significantly more than buying individual policies. So, look into them seriously before making any decisions, and Clark recommends that you say, "Thanks, but no thanks."

Clark talked recently about the nation’s best homeowner’s insurance company according to Consumer Reports. It was Amica Mutual. Now, J.D. Power & Associates has done its own customer satisfaction survey, as well. The company found that USAA got top honors. USAA is available to military members and their families, which is the only downfall. So, who came in second? Amica Mutual. Obviously these two companies are elites in the insurance market. They were so far above all other companies that the organizers of the survey had to create a separate chart for the other companies. As for Amica, it’s almost like joining a private club because it’s so difficult to become a member. The company doesn’t seek out customers or advertise much because it doesn’t have to. They will also question you to the nth degree if you apply. If you make it in, you won’t get a deal your first year. You will pay the equivalent of their retail rate. After that, you’ll pay more of a co-op rate. So, who got the lowest score, according to J.D. Power? The worst was Prudential. Only slightly above was Traveler’s Insurance.

How would you like to have someone spying on you who never sets foot in your house or even on your property? No, we’re not talking about aliens. The L.A. Times has found out that a number of homeowner’s insurance companies are taking satellite pictures of customers’ homes to determine whether to keep you or not. It’s happening in California, and insurers think this is a great idea. They’ve developed an artificial intelligence risk meter that determines where your house stands with the company. Based on that scale, the companies decide whether to keep you or not. These are homeowners who may have never filed a claim. It’s ridiculous!

After natural disasters, insurance companies often run ads on television, claiming they were there for you when no one else was. It’s true that these circumstances can be devastating and we reach out to companies for help. Unfortunately, there are circumstances when some insurance companies don’t behave and don’t shoot completely straight with their customers. This is especially true when using contracted insurance adjusters. Many insurance companies contract with adjusters who are not employees of the company. It’s cheaper for the companies, and the adjusters do their best to lowball the customers because they want as many jobs as possible from that company. Their job is to offer the lowest amount possible for the insurance company, and they work hard to do that. So, you may want to consider hiring your own adjuster. Some charge a percentage of the amount, so make sure that amount works for you. But just because the adjuster says your vehicle is worth a certain amount doesn’t make it so. Many times, it’s not even close to what the vehicle is worth. Fight for your money. And if the company doesn’t behave, go to your state insurance commission and complain. It’s your right!

Florida just experienced back-to-back hurricanes. Clark’s vacation home in Florida suffered severe damage. He didn’t have hurricane shutters, but it wouldn’t have made much of a difference because the condo is on the first floor. The home was hit with 80 to 90 mph winds for about eight hours, and most of the damage was uninsured. He’s going to have to deal with a lot of headaches. But if this was simply a news story for you, get ready for some good news. Your homeowner’s insurance rates will not go up. The insurance industry lost a lot, but most of the money will be absorbed by individuals, companies and families. Secondly, because of Hurricane Andrew, many companies went to what are called “reinsurance pools,” which means they sold off a lot of risk. And lastly, the state of Florida has a risk pool system for this very occurrence. So, the actual affect on the insurance companies is minimal, and these hurricanes won’t cause your insurance rates to go up.

If you have a terrible disaster and you lose your home, do you have enough homeowner’s insurance to cover the damage? Many people are finding out that they don’t. It’s happening because insurance companies have quietly cut back on what they cover with homeowner’s insurance. About five years ago, companies decided that they didn’t want to be in the “guaranteed replacement” business anymore. Insurers used to guarantee that they would rebuild your home from scratch if you lost it. But the wording has changed. The disclaimers you get in the mail now say the company will honor an “extended replacement” instead of “guaranteed replacement.” Extended replacement policies say that company will pay the amount you are covered plus 25 percent or 30 percent more. It sounds great. But if the damage is more than that limit, you have to pay the rest. You have to consider that the cost of construction goes up every year. So, if you’ve been in a home three or more years, the odds are that you’re underinsured. Just be sure that you call your company every year and increase the amount of coverage on your home. It’s going to cost you a bit more in premium money. But that’s better than paying a $50,000 out-of-pocket expense. It’s fairly easy to do. Insurers will usually just increase the coverage limit over the phone. Sometimes insurers choose to send out an appraiser before they increase the coverage. But calling each anniversary of your policy will usually do the trick. The other key is to raise deductibles on your insurance to the highest level. Homeowner’s insurance should only be used for major, catastrophic events. So, it’s okay to raise the deductibles as high as you can. That will reduce your premiums a bit, saving you more money.

Clark wants to talk to people who own homes out there. What are the odds that you do not have enough insurance to cover your home? According to recent reports, two out of three people are significantly underinsured. You may have bought a house years ago for $100,000, and you haven’t adjusted the value since. Say you’ve been lucky during that time and now the house is worth $20,000 more. If there is a fire and you must rebuild your home, you will only get the original $100,000 in coverage if you haven’t upgraded the coverage. So, if the damage is $140,000, you will have to pay $40,000 for something that wasn’t even your fault. Most insurers will allow you to increase the coverage. So, if you’ve been in a home for a while, check out your coverage. If you don’t think it’s enough, bump it up. At the same time you do this, raise your deductibles as high as they will go. Unless your mortgage company prohibits it, Clark would like you to boost your deductible to $2,500. Most people have a $500 deductible, but that is not a good idea. Why? First of all, you pay a lot more in insurance costs. Secondly, if you make a claim against your homeowner’s insurance for a small amount of money, the insurer may treat your horribly. Sure, they’ll pay the claim. But they may fire you after. So, you only want to use homeowner’s insurance for catastrophes. If you’re thinking of switching insurance companies, Clark has great news. The September issue of Consumer Reports magazine recently rated insurers from best to worst. The No. 1 company this year is Amica Mutual, and that company is head and shoulders above the rest. The first year with the company is more expensive, but year two and beyond are less. No. 2 is a newcomer - Auto Owners Insurers, Inc. - which writes coverage in about 20 states. Coming in third is Cincinnati Insurance. For the first time since 1990, USAA is not in the top three. This year, USAA is No. 5. But the company is still very good.

About one in four people think it’s okay to cheat their homeowner or auto insurance company. Clark is stunned by that news. He has dealt with insurance representatives who assume that most people who submit claims are being dishonest. But maybe they have a reason to be cynical about it. The sad part is that when something legitimate happens, you’ll be guilty until proven innocent. In Britain, insurance agents are using voice recognition software to determine if you are lying. The caller is withdrawing one out of every eight claims, as a result. It’s so valuable to insurers that they are paying as much as $35 per phone call. The software found that about 70 percent of people were telling the truth, meaning that 30 percent were being dishonest. But when the agents checked further, they found that one third were actually telling the truth. So, the system should be used as a fact checker, not as an ironclad system. So what is happening in the States? Two insurers - one in California and one in Illinois - are about to start testing the software on customers. The industry is not revealing which companies those are, but in many states insurers have a right to record you without your knowledge. So in these “one party states,” you could be tested and not know it. So, don’t lie!