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Understanding Long Term Disability Insurance

Financial pressure quickly builds when you’re off work due to disability. You expect disability insurance coverage to kick in when you suffer an injury or illness that prevents you from working. The reality is that long term disability (“LTD”) insurance coverage can be difficult to obtain. The application process is complex, benefit decisions can be delayed for extended periods while the insurance company investigates, and many valid LTD claims are denied

Long term disability insurance

During this difficult time in your life, you need trustworthy information. You want to know what to expect. Understanding the LTD insurance claims process is critical to empowering yourself and reducing your stress levels. In today’s blog post, our long-term disability lawyers will answer some commonly asked long term disability insurance questions. If you’d like to know more about your legal rights or need help obtaining LTD benefits, we welcome you to reach out to our long term disability lawyers for a free case evaluation.  

What is disability insurance?  

Disability insurance is income replacement. It pays you a portion of your income loss if you’re unable to work due to disability. You may have disability insurance coverage through your employment, or you may have purchased your own disability insurance coverage.  

What’s the difference between short term disability and long-term disability?   

You must look at the terms of your policy to find out if you’re covered by a short-term disability plan, a long-term disability plan, or both. Here are the key differences between the two:  

  • Short-term disability (“STD”) provides income replacement, but only on a temporary basis—usually three months to one year. The waiting period before you begin to receive STD benefits is usually only a few days. If you don’t have short-term disability coverage but are unable to work due to a serious injury or illness, you may qualify for EI Sickness Benefits.  

  • If you continue to be unable to work after STD coverage/EI sickness benefits are exhausted, you may be eligible for long term disability benefits. You must be off for a certain amount of time (known as the “waiting period” or “qualifying period”) before your disability is considered “long term.”   

To avoid delays, you should submit your LTD claim during the waiting period; if you’re approved, payments will begin from the date the waiting period ends.   

How do you apply for long term disability benefits?  

Your insurance policy will define the applicable waiting period, the time limits for applying, and what you must show to prove you are eligible for LTD coverage. You will have to submit a detailed application package to the insurance company, setting out information including: 

  • the nature of your injury or illness 

  • your symptoms 

  • the treatments you’ve received (or will receive)  

  • your job duties, and  

  • how the injury or illness prevents you from working.  

For a successful claim, you’ll need your doctor’s support and a report from your employer. The application forms can be obtained either from your employer or the insurance company.  

Are you eligible for LTD benefits?  

Eligibility does not depend on the exact type of injury or illness. You may have a back injury and still be able to work. You may be diagnosed with cancer, multiple sclerosis, or fibromyalgia and continue at your job. Instead, to qualify for LTD benefits, you must satisfy the test for disability as set out in your insurance policy.  

Each policy contains a definition of “disability”, and the applicable test typically changes over time:   

  1. The own-occupation test typically applies for the first two years. The eligibility requirement at this stage is that you are unable to perform the essential duties of your own occupation. 

  1. The definition of disability typically changes at the two-year mark. To continue to qualify for LTD benefits beyond that time, you must prove to the insurance company that you are not able to perform the essential duties of any occupation you’d be suited for by reason of education, training, or experience. This is known as the “any occupation” test.  

It’s unfortunately common for insurance companies to deny long term disability claims. It’s also very common for insurance companies to decide to terminate benefit coverage, especially at the two-year mark. Our long term disability lawyers can help get your claim reviewed if your claim is denied or your LTD benefits are cut off.  

How much will you get paid on LTD? 

Once your LTD claim has been approved, you will receive income replacement payments, usually on a monthly basis. Long-term disability plans typically pay 60% to 85% of your base income. You may also have coverage for certain medical treatments and rehabilitation expenses. Exactly what is covered and how much you’ll receive depends on the terms of your LTD policy.   

How long will your LTD benefits last?  

Your LTD insurance policy will set out the coverage period. Some LTD policies specify a term of coverage (e.g., 5 years, 10 years). Other LTD policies have no set duration; if you meet the applicable test for total disability, coverage could continue to age 65. In some cases, coverage may last past age 65 to death.  

Guidance from our experienced long-term disability lawyers 

Oshawa and Lindsay lawyers at Kelly Greenway Bruce know how stressful it can be to live with a disability. We also know all the tricks and tactics LTD insurance companies use. Once you hire Kelly Greenway Bruce, we deal with the insurance company on your behalf. No more struggling to figure out deadlines or dealing with insurance company gaslighting. You can focus on your health and taking care of yourself, knowing that you have a trustworthy advocate on your side. We encourage you to connect with our long term disability lawyers in Oshawa or Lindsay today. 


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