There is no one answer to how much coverage is enough. Some financial planners say five to seven times your annual income is sufficient. Others argue that you need twice as much in face value. That would mean a person making $50,000 a year should have anywhere from $250,000 worth of coverage to $750,000 or more.

And remember, the sole purpose of life insurance is to replace your income in case you die, so that your dependents can maintain their current lifestyle.

Factors to consider include whether the surviving partner will have child care expenses if one partner is out of the picture. Do you have other assets on which to draw? Will your children be out of the nest soon? These, and many other factors, influence the decision on how much coverage you need.

It's worth noting that many people who buy whole-life policies are underinsured. Because of the investment component of whole life, the policies are much more expensive than term. To make up for this, many people simply buy less coverage, defeating the purpose of buying insurance in the first place -- again, to cover dependents.

Next, you've got to figure out how long you need the policy.