By Alison Overholt alison.overholt@complete-insurance-guide.com Complete Insurance Guide Columnist November 1, 2004

Life insurance is a complicated issue ? when should you buy it, how much should you pay, and what kind of insurance policy do you need? Read on for a few simple guidelines on finding a life insurance policy that fits your needs and circumstances.

Figure out what kind of insurance you need

First, ask whether you need life insurance. Do you have kids? A spouse? Parents who depend on you for income, or who live with you and have no other source of income? If the answer to any of these questions is yes, it makes sense to have a life insurance policy. That way, in the event of your death, your loved ones will have money they can count on to carry them through until they get back on their feet and find other sources of income.

1. Supplementary Life Insurance. Many people have a life insurance policy through their employer ? usually these policies pay your family between one and three times your annual salary in the event of your death. But if you have kids about to enter college, or other series financial responsibilities, you may want to have a supplementary life insurance policy.
2. Term Life Insurance. This is a policy you can buy for a specific period of time, or a ?term.? It pays a benefit only if you die within that term. Term life is a good idea if you are going on a trip to a dangerous place, or engaging in a risky endeavor for a specific period of time, for example.
3. Universal Life Insurance. It is a flexible plan, which allows the policy holder to adjust payment schedules and increase or decrease the amount of coverage over time, as life circumstances change.
4. Whole life insurance (also known as Permanent Life Insurance). This is the most basic type of insurance. By paying a set premium over the course of your lifetime, your dependents will receive a set benefit upon your death.

Find a life insurance agent you can trust

When it comes to life insurance, you don't want to mess around. It's important for your policy to be administered by a company you can trust, because you want that money to be there for your family if you pass away.

Many web sites offer free online insurance quotes, and many will offer your cheap life insurance rates. Some of these will be good insurance, others will not ? it's important to check with the Better Business Bureau and with reliable friends or even online message boards to see customer feedback and determine whether the agent or company you're dealing with is trustworthy.

You don't need to go down to you local agent in order to get a policy ? online quotes are a great convenience and service. Just make sure you do your homework before signing up.

About the Author
Alison Overholt is a freelance writer based in New York. She holds a degree in government, with honors, from Harvard University and writes frequently about business, travel, and lifestyle subjects for national magazines and other publications.