Long term disability insurance is a safety net for people who become injured or sick to the point where they are unable to return to work for an extended period of time. Long term disability insurance provides some protection by providing you with a portion of your income over the period for which you are considered totally disabled and unable to work. Read on to learn more about long term disability in Ontario.
What are Long Term Disability Benefits
Long term disability benefits provide income replacement for disabled employees who meet the definition of “totally disabled.” Typically, long term disability benefits are paid on a monthly basis up to a maximum amount as outlined in the disability policy.
There are several types of long-term disability benefits available in Ontario. Your employer may provide long term disability benefits through a group plan, or you may have private coverage through your own policies. However, other types of long term disability benefits include:
- Canada Pension Plan Disability;
- Workers Compensation;
- Ontario Disability Support Program; and,
- Disability Tax Credit.
What Totally Disabled Means for Long Term Disability Insurance
There are 2 definitions used in your long term disability policy to define the period of time you are totally disabled from working. Somebody is “totally disabled” where they cannot work because of a medical condition or injury. Any illness or injury could qualify for long term disability benefits. It is not the illness or injury itself that matters, rather it is the impairments or restrictions caused by your injury or illness that matter. The diagnosis itself does not decide whether a worker is qualified for long term disability benefits.
The meaning of “totally disabled” changes over time. When you first apply for long-term disability benefits, the assessment of total disability is based on whether you can perform your own occupation. This means that you are not able to perform the essential duties of your job.
After 2 years of being on long term disability benefits the insurer will assess whether you can perform any occupation. This means you are not able to perform the essential duties of any job that you are reasonably qualified for. Most long term disability policies use the own occupation definition for 2 years, but it may be less or more depending on the policy.
Who qualifies for Long Term Disability?
If an employee has long term disability insurance coverage at the time they become disabled, they are qualified to receive long term disability benefits. The conditions covered by a policy range from physical injuries to mental health illnesses.
Pre-existing conditions are a common exception to eligibility for long term disability benefits. Pre-existing condition clauses exclude or restrict you from receiving long-term disability benefits if you have a recurrence of symptoms from a previous condition you had prior to starting your job. This is often included in policies in order to protect the company from a high claim payout. Typically, pre-existing conditions become an issue if a disability occurs a short time after coverage begins. The insurer may then investigate to see whether your entitlement to benefits is excluded.
Exclusions and Limitations
There is often a list of exclusions and limitations within the disability policy. If any of the listed conditions apply to you, you may not be eligible for benefits. For example, some common exclusions are self-inflicted injuries, including alcoholism.
The elimination period is the waiting period between the onset of the disability and the time you are first eligible to receive long-term disability benefits. This waiting period is typically covered by short term disability benefits, if available.
Once this elimination period is satisfied, you will be eligible to receive your benefits at the end of the following month. For example, if it states in your policy that there is a 90-day elimination period, this means you are 4 months away from receiving your benefits.
How to Apply for Long Term Disability Benefits in Ontario
The first step in applying for long term disability benefits in Ontario is to see if you have coverage under a group medical plan. If you have coverage, then you should immediately speak with your doctor. You should not leave work to apply for disability benefits without first speaking with your doctor and getting their support.
To apply for long term disability benefits, you likely will have to complete a number of application forms. For instance, most insurance policies will have a notice of claim form, as well as a medical report form. You should confirm what you need to provide to the insurer in order to begin your access to benefits.
When completing the forms, take care to fill them out completely and accurately. You do not want to make a mistake and have your disability benefits denied. Your doctor will very likely have to fill out a form as well.
In submitting your application, it can sometimes be helpful to write a covering letter. The letter should be brief and should indicate what documents are attached to your application. You may even use the letter to quickly summarize any special circumstances.
Once you have submitted your application, you may be required to attend an interview with a representative from the insurance company. This person will be the one who decides whether your claim is approved or denied. You should prepare for this call and be ready to answer any questions they may have accurately and confidently. There is a chance that the insurer might use this interview to find a reason to deny your claim for long term disability benefits, so you should be careful when speaking with them.
Thereafter, you need only wait for their decision. If you are not approved, the disability lawyers at Monkhouse Law can assist in fighting that denial.
How much does Long Term Disability insurance pay?
On average, long-term disability benefits range from 60% to 80% of your salary. The benefit is typically paid on a monthly basis and often there is a maximum monthly payment which is outlined in the disability policy. You should always review your long term disability benefits policy to see how much you are entitled to receive.
How long can you stay on Long Term Disability?
Depending on the severity of the condition, you may be able to stay on long-term disability benefits until the retirement age of 65 in the event you are disabled from performing your own job or any other occupation even with reasonable retraining. Less severe conditions, however, may range from several months to several years.
What if your Long Term Disability Claim was denied?
An employee may be denied long-term disability coverage for many reasons, one of which may be that the insurer does not believe they are totally disabled in accordance with the long-term disability policy. Even if the employee has ample documentation to support their claim for benefits including medical records and doctor notes, it may be deemed insufficient.
A worker who has been denied long-term disability benefits has two options:
- The first option is to appeal the decision with the insurer. However, this option is not recommended. You can appeal up to 3 times, and each one must be done within 90 days of the decision. It is important to note that unless your physician can provide significantly different documentation to support your claim, it is not the best choice to appeal the decision, because your appeal is very likely to be dismissed.
- The second option is to commence a lawsuit against the insurance company for wrongful denial of disability benefits. To achieve the best outcome, it is preferable to retain legal representation. This will take the stress off you and allow you to focus on your recovery.
If your long term disability application is denied, don’t waste time arguing in appeals with the insurer. Instead, you could hire a Long Term Disability Lawyer at Monkhouse Law to assist you with going through the Court, which is a higher authority. You should act quickly in consulting us about your options given the insurer’s internal 90-day appeal deadline and the Court’s limitation deadline of 2 years to bring a claim.
Common Reasons Long Term Disability Claims Are Denied
There are many reasons why your application for long term disability benefits may have been denied. Insurers often rely on a number of common explanations for denying long term disability benefits, including the following:
- Failing to file your claim on time;
- An exclusion within the insurance policy;
- Not enough medical information or evidence;
- Refusal to attend interviews or to communicate with the insurer;
- Refusal to comply with reasonable medical treatment;
- A change in definition of what is considered “totally disabled”; and,
- The insurer does not believe you.
If your application for long term disability benefits is denied for any of the above reasons, you may have a claim for wrongful denial of disability benefits. You should consider speaking with a lawyer rather than appealing internally through the insurance company.
What if you are terminated while on Long Term Disability?
It is discriminatory under human rights legislation to terminate an employee due to their disability. Under the Ontario Human Rights Code, an employer is required to accommodate an employee to the point of undue hardship. If you are terminated from your job while on disability leave, you should contact a Long Term Disability Lawyer at Monkhouse Law as soon as possible for advice about your claims and whether it may have been discriminatory.
Can an employer terminate an Employment Agreement for Frustration of Contract?
In some cases, an employer may be able to terminate the employment agreement for frustration of contract. Frustration of contract in the context of disability leave can occur if it becomes unlikely that the employee will be able to return to work within a reasonable amount of time. If frustration of contract has occurred, an employer is only required to pay the employee their minimum entitlements under the Employment Standards Act.
In this video “Basics of Long Term Disability Insurance” [6:04 min], Employment Lawyer Andrew Monkhouse covers what long term disability insurance is, how it helps employees, and what it means for employees with disability insurance.
Given the complexity of these issues, please contact a Long Term Disability Lawyer at Monkhouse Law for guidance. Monkhouse Law is an employment law firm located in Toronto with a focus on employee issues. Give us a call at 416-907-9249 or fill out this quick form. We offer a free 30-minute phone consultation.