Implementing replace function

Hello Postgres users,

to mimic the MySQL-REPLACE statement I need
to try to UPDATE a record and if that fails - INSERT it.

But how can I detect that the UPDATE has failed in my SQL procedure?

begin transaction;

create table pref_users (
id varchar(32) primary key,
first_name varchar(32),
last_name varchar(32),
female boolean,
avatar varchar(128),
city varchar(32),
lat real check (-90 <= lat and lat <= 90),
lng real check (-90 <= lng and lng <= 90),
last_login timestamp default current_timestamp,
last_ip inet,
medals smallint check (medals > 0)
);

create table pref_rate (
obj varchar(32) references pref_users(id),
subj varchar(32) references pref_users(id),
good boolean,
fair boolean,
nice boolean,
about varchar(256),
last_rated timestamp default current_timestamp
);

create table pref_money (
id varchar(32) references pref_users,
yw char(7) default to_char(current_timestamp, 'YYYY-WW'),
money real
);
create index pref_money_yw_index on pref_money(yw);

create or replace function update_pref_users(id varchar,
first_name varchar, last_name varchar, female boolean,
avatar varchar, city varchar, last_ip inet) returns void as $$

update pref_users set
first_name = $2,
last_name = $3,
female = $4,
avatar = $5,
city = $6,
last_ip = $7
where id = $1;

-- XXX how to detect failure here? XXX

insert into pref_users(id, first_name, last_name,
female, avatar, city, last_ip)
values ($1, $2, $3, $4, $5, $6, $7);
$$ language sql;

commit;

Thank you
Alex