The key reason to buy cash-value life insurance is to guarantee coverage for the rest of your life at a predictable, albeit expensive, cost. Many people don't need insurance that long - most need it to provide support for their kids until they graduate college or to cover their spouse until their pension kicks in. But some people in some circumstances may want lifelong protection:

• You'll owe estate taxes. If your estate is large enough to create an estate-tax bill when you die ($1 million in 2006), your heirs can use the death benefit to pay the IRS. Because you don't kow when you will die, you need to hold on to your life insurance indefinitely.
• You don't know how long you'll need insurance. Few companies offer term policies with level premiums for more than 30 years, and the price jumps after the term is over. If there's any chance that your need for insurance will run longer than that, but a cash-value policy or a term policy that converts. For example, if you don't know how long you'll be supporting dependents, you might want a cash-value policy.
• You want to leave a legacy. Even if no one will suffer financially when you die, you might want to leave money to your grandchildren or a charity - which may mean you have to keep the policy in force for the rest of your life.
• You need another tax shelter. If you've invested as much as you can in your IRA, 401(k) plan and other tax-deferred savings options, and if you need insurance for more than 10 to 15 years (the surrender period for most agent-sold policies), then cash-value insurance can give you another tax-deferred option. You may come out ahead if you trade frequently or are in a high tax bracket and ten to have large tax bills on your long-term savings.

What to buy?

Generally, the best choice is variable life, which lets you invest the cash value in several mutual fund clones, which usually span the risk spectrum. Most variable-life policies also have universal-life features, allowing you to adjust your premium and death benefit. Most variable-life policies guarantee that your death benefit won't decrease, but you may have to pay higher premiums if your investments decline.

If you want premiums that never change, a death benefit that cannot diminish, and a minimum-guarantee rate of return (albeit smaller), then whole life is your best bet.