How much to charge for album cover design and what legal precautions I should take?

Sounds like you want to license the use of the image to them. There are many ways to do that - one time use, unlimited use, etc... Since it's an album cover, they'll probably want some kind of multiple use license because they'll be using it for CDs, promotional posters, t-shirts (perhaps) - etc... Basically you write up a contract that says you retain ownership of the original art, but they can use it x number of times. You can be specific about it in the contract (the band can't use it on a website, for instance) or very general (ie: they can do whatever they want with it for the next 3 years). Work out something that's agreeable to everyone and then a price. You'll probably want a nice piece of change since they will probably be getting a lot of use out of it. So far as YOU "getting in trouble" - no problem. You own the art, so you can set the parameters of what you can do with it too. Again - another point you work out between the two parties. They might want a little exclusivity while the album is being heavily promoted (so maybe you agree not to use it for anything else for the next 18 months or something), but in the end you keep the rights. Once all that is settled you work out a fee to have the art photographed (another fee you tack onto the overall price) and you give them a digital file. They never touch the original unless you let them.

And remember that your piece of art currently has no value attached to it, It is the demand that creates the value. Do not undersell yourself, if they are serious about wanting to use the image rights they must be willing to pay the right amount.
Dont get caught short, dont give them anything untill a solid agreement is in place and be very careful about stating that you still own the intellectual rights.

If i were to paint a picture of superman i would own the painting but not the rights. If they want to produce further different paintings by someone else but with the subject matter of your painting you will still own the interllectual rights and therefore would need compensation to them to do so.

hope that makes sense.

I suggest consulting with a lawyer about this first before you give anybody anybody permission to use your art.

You need to license your artwork and bill accordingly. Typical licenses are for 1 year or more, and usage (and your compensation!) depending on distribution. Worldwide license would garner more than a U.S.-only license, for example.