Long-term disability is often offered in Canada as an employee benefit to help employers retain and support their workers. This type of insurance is designed in such a way that it provides coverage in the event of an accident or illness that puts the individual out of work. Each long-term disability policy has its unique features but there are some similar aspects that you should also be aware of.
Do The Benefits Start Immediately?
How long will you be off work before you get to take advantage of the long-term disability benefits? This period of time is often referred to as the elimination period. Every long-term disability policy has a stated elimination period, which provides guidelines on how long you’ll have to wait before the benefits start. For instance, the benefits may only start after you’ve exhausted your sick days.
Owner Occupation Period
Before the benefits are awarded to the patient, an assessment is done to determine if he/she would be able to go back and perform the duties of the job they were employed to do at the time of the accident or illness. Once the insured is awarded disability benefits for a period of time, typically two years, the definition of disability may change. Another evaluation is done to determine the insured’s ability to perform any meaningful work. This period is known as the occupation period and is very important as the insured’s health is closely assessed to determine if the individual is entitled to benefits. With the help of an experienced long-term disability lawyer, you can get legal advice to ensure you still receive reasonable benefits once the occupation test is done.
The Payout Amount
The insured is required to pay a certain amount of premium prior to disability in order to get a payout. Some people opt for higher premiums in order to increase their payout. By paying higher premiums, you may qualify for as high as 70% of the previous income. Employees who choose to pay the minimum premium may only qualify for 30% of their previous income as a payout. Keep in mind that there are some deductions that can be made from your long-term disability benefits. For instance, if you receive money from worker’s compensation insurance, this may be deducted from your benefits. Taxes may or may not be deducted as well.
What Happens In The Event Of Recurrence Of a Disability?
Should you return to work after having received long-term disability benefits and then sustain an injury or illness after a while, you may be entitled to LTD benefits immediately without a waiting period. In most cases like these, a new waiting period is not required depending on the length of time that you were required to return to work before the recurrence of disability.
Will The LTD Benefits Stop?
Typically, LTD benefits stop when the insured reaches a certain age, say 65. The LTD benefits also stop when the individual returns to work or passes away. In some cases, an insurance company may suspend payments. You need to reach out to a long-term disability lawyer immediately if your LTD benefits have been suspended or denied.
At Edson Legal we have successfully handled many serious disability and critical insurance disputes.
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