The next time your party guests linger past your bedtime, ask them how they feel about life insurance. Watch that they don't trip over your cat as they sprint to the door.

Nobody wants to talk about life insurance. But if you have young children or others who depend on you, you should have it.

Millions of Americans have no life insurance, and millions more don't have enough to provide financial security for their loved ones. That's a shame, because if you're reasonably healthy, you can buy a lot of life insurance without spending a lot of money. Average premiums for individual life insurance have been falling about 5% a year since 2000, and they're expected to drop an additional 4% in 2007, according to the Insurance Information Institute. In 2007, a 40-year-old male non-smoker who buys a $500,000, 20-year term insurance policy will pay an annual premium of $615 if he qualifies for the "standard" rate, the institute estimates. If he qualifies for the "preferred" rate, which has more stringent health requirements, he'll pay $340, the institute says.

"The rates are as low as I've ever seen," says Byron Udell, CEO of AccuQuote, an online insurance broker.

Life insurers have reduced their premiums because people are living longer, lowering the risk that the insurers will have to pay benefits to survivors, says Steven Weisbart, an economist for the institute. Insurers have also developed more sophisticated ways to measure the risks of certain lifestyles and diseases, says Michael Kalen, executive vice president for The Hartford's individual life division.

Some tips for buying life insurance:

• To save money, buy term insurance. There are two types of life insurance: term and permanent. Term provides a benefit only if you die during the period covered by the policy. Permanent life insurance remains in effect as long as you pay the premiums. Part of the premium goes into an investment account. You can withdraw some of that money or borrow against your policy.

Premiums for permanent life insurance are considerably higher than premiums for term insurance. If your goal is to provide financial security for your children until they're old enough to support themselves, a term policy is probably all you need. If you still need insurance at the end of the term, some insurers will let you renew your coverage, but you may have to undergo a medical exam to get the lowest rate.

Permanent policies are appropriate for people who use insurance as part of an estate-planning strategy and want the policy to last until they die, Kalen says.

• Don't rely on your employer's life insurance policy. Many companies offer life insurance as a benefit, but it's usually not enough to provide financial security for your family, Kalen says. Most workplace policies cover one to two times your annual salary. Financial planners generally recommend buying enough insurance to replace seven to 10 times your annual salary.

In addition, most employer-provided policies aren't portable. If you change jobs, there's no guarantee your new employer will offer a life insurance benefit. If you've had health problems, the cost of buying an individual policy may be prohibitive. Buying your own life policy while you're young and healthy "is a much more stable financial strategy," Weisbart says.

• If you have health problems, don't assume you're uninsurable. Advances in the treatment of cancer and other diseases have led insurers to lower premiums for people once considered high-risk. In the past year, Hartford has reduced premiums for women who have been treated for early-stage breast cancer and men who have had surgery for moderate levels of prostate cancer. Prudential announced last week that it will lower premiums for people who have been successfully treated for heart disease.

Prudential Financial lowered premiums for prostate cancer survivors several years ago, and it recently reduced rates for survivors of breast and bladder cancer, says Mike McFarland, a vice president at Prudential.

• Shop around. Though insurance companies have reduced premiums for some people, they've also tightened the criteria for their lowest rates, Udell says. Even if you're healthy, you may not qualify for the best rates — often known as "preferred plus" — if one of your parents suffered from a serious illness at an early age, or if you enjoy skydiving.

The standards for the best rates vary among insurers, so it pays to work with an insurance agent or broker who deals with several companies. On a $500,000 term policy, getting the lowest rate on premiums could save you $100 to $250 a year, Udell says. "Over 20 years, you're talking about a lot of money."

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Sandra Block

Sandra Block covers personal finance for USA TODAY. Her Your Money column appears Tuesdays. Click here for an index of Your Money columns. E-mail her at: sblock@usatoday.com.

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