If something happened to you, how would your family replace your lost income? Life insurance can help replace your income when needed at your death. However, with the wide variety of policies available, it's important that you understand some of the basic types of life insurance coverage.

Carpenters Life Insurance – Active Participants eligible for Health and Welfare Plans A, B or Flat Rate are entitled to both Life Insurance and Accidental Death and Dismemberment (AD&D) Insurance. Life Insurance provides Carpenters a $20,000 benefit for your beneficiary (the person you named to collect the insurance proceeds), while AD&D can provide up to an additional $20,000 in the event your death was caused by an accident. This benefit can give beneficiaries some much-needed income at a difficult time. Your retirement savings, including your Carpenters Pension, Annuity and possibly 401(k), may further provide income for your loved ones in the event of your passing. However, you may consider additional life insurance to ensure your family’s financial security. Let’s look at your options.

Term Life Insurance - Term insurance provides a death benefit for a specific period of time. This can be a good option for families, to provide financial security while raising a family. Once children reach adulthood, there may be less need for life insurance. If you die during the coverage period, your beneficiary receives the death benefit- the face amount of the policy. If you live past the term period, your coverage ends, and you may get nothing back. Term insurance is available for periods ranging from one year to 30 years or more. You may be able to renew the policy for a new term without regard to your health, but at a higher premium.

As you get older, the chance that you will die increases. For this reason, premiums generally increase as you get older. However, some term life insurance can be purchased for a fixed amount of death benefit, at a level premium, for a specified number of years. Most term insurance also has a conversion feature that allows you to switch your coverage to some type of permanent insurance without answering health questions.

Whole Life Insurance - Whole life is a type of permanent insurance or cash value insurance. Unlike term insurance, which provides coverage for a particular period of time, permanent insurance provides coverage for your entire life, as long as you pay the premiums.

When you make premium payments, you pay more than is needed to pay for the current costs of insurance coverage and expenses. The excess payment is credited to a cash value account. This cash value account allows the insurance company to charge a level premium and to provide a death benefit and cash value throughout the life of the policy. The cash value grows tax deferred and can be directly accessed through a partial or complete surrender of the policy, or through policy loans. It is important to note, however, that a policy loan or partial surrender will reduce the policy's death benefit, and a complete surrender will terminate coverage altogether.

Universal Life Insurance - Universal life is another type of permanent life insurance with a death benefit and a cash value account. Unlike traditional whole life, universal life insurance allows you flexibility in making premium payments. Universal life insurance policy premiums may be adjusted upward or downward within policy guidelines. Reducing or increasing premiums will impact the growth of the cash value component and possibly the death benefit. Some universal life policies also allow you to choose a level or increasing death benefit. Be aware, though, that if you want to raise the amount of coverage, you'll need to go through the insurability process again, probably including a new medical exam, and your premiums will increase.

Strong Interest in Life Insurance

 Source: 2023 Insurance Barometer Study, Life Happens and LIMRA

Article adapted from World Investment Advisors by Broadridge Advisor Solutions.

The cost and availability of life insurance depend on factors such as age, health and the type and amount of insurance purchased. Policies commonly have mortality and expense charges. Loans and withdrawals will reduce the policy's cash value and death benefit, could increase the chance that the policy will lapse, and might result in a tax liability if the   policy terminates before the death of the insured.