Long-term disability (LTD) insurance provides income replacement if an illness or injury prevents you from working for an extended period of time. Many employees in Ontario receive LTD coverage through workplace benefits plans, although some individuals purchase private disability insurance.
Understanding how your LTD policy works is important. Insurance policies often contain definitions, limitations, and exclusions that determine whether your claim will be approved or denied.
What Is Long-Term Disability Insurance?
Long-term disability benefits replace part of your income when you cannot work due to a medical condition. These benefits typically begin after a waiting period once short-term disability benefits or sick leave have ended.
Most LTD policies replace approximately 60–70% of your pre-disability income, although the exact amount depends on the policy and any applicable benefit caps.
Key Disability Definitions in LTD Policies
Most disability insurance policies use two definitions of disability.
Own Occupation
Under the “own occupation” definition, you are considered disabled if you cannot perform the essential duties of your specific job. Many LTD policies apply this definition for the first 12 or 24 months of benefits.
For example, a nurse who cannot perform the physical duties required by the job may qualify for LTD even if they are capable of performing other types of work.
Learn more: Own Occupation vs Any Occupation
Any Occupation
After the own occupation period ends, many policies change to an “any occupation” definition of disability.
At this stage, the insurer may terminate benefits if they determine you are capable of working in another job that is reasonably suited to your education, training, or experience.
This transition is one of the most common reasons LTD benefits are cut off.
Learn more: What Happens After Two Years on LTD
Common Clauses in Long-Term Disability Policies
LTD policies often contain specific clauses that can affect eligibility for benefits.
Pre-Existing Condition Clauses
Many policies include a pre-existing condition exclusion. These clauses may prevent coverage if your disability is related to a medical condition that existed before your coverage began.
Insurers often review medical records to determine whether the condition existed prior to coverage.
Exclusions and Limitations
Policies frequently contain exclusions for certain types of injuries or conditions. Examples may include:
- self-inflicted injuries
- certain substance-related conditions
- conditions specifically excluded by the policy
The wording of the policy is important when determining whether an exclusion applies.
Waiting Period (Elimination Period)
Most LTD policies include a waiting period before benefits begin. This period is often called the elimination period.
For many policies, the elimination period is around 90 days. During this time, employees may rely on sick leave or short-term disability benefits if available.
Why LTD Claims Are Sometimes Denied
Even when someone has legitimate medical issues, LTD claims may still be denied. Insurers commonly argue that:
- medical evidence is insufficient
- the claimant can perform other work
- the policy exclusions apply
- the claimant does not meet the definition of disability
If your LTD claim has been denied, you may have options.
Learn more: Long-Term Disability Denied: What to Do
Talk to a Long-Term Disability Lawyer
If your long-term disability benefits were denied or terminated, it may be helpful to have your policy reviewed by a lawyer.
Monkhouse Law Employment Lawyers assists non-union employees across Ontario with LTD claims, appeals, and lawsuits.
Request a free 30-minute phone consultation or call (416) 907-9249.