Long term disability benefits are monthly income replacement benefits provided pursuant to a long term disability (LTD) insurance policy. It may be offered by your employer or you may take out a policy on your own.
Each policy may be different from the next but most offer either a percentage of your income (usually between 60-85% of your income) or a set monthly amount if you become disabled and unable to work.
Most policies offer two periods of benefit entitlement – the first 24 months following your initial entitlement and the period that follows the first 24 months.
During the first 24 months the benefit is usually payable when you are disabled due to an illness or injury and you are unable to return to your own pre disability occupation – also known as the “own occ” test. Your insurer will require evidence that your disability prevents you from working in your own occupation. For example, you are a bus driver. Unfortunately you become disabled following an illness and cannot return to work work. Your insurance company will require evidence that you are disabled from working as a bus driver. This evidence usually comes from your medical practitioner such as a family doctor or treatment specialist.
After 24 months, the test for entitlement usually (although not not always) changes. After 24 months the policy will continue to pay benefits if you are unable to return to any occupation for which you are reasonably qualified by education, training or experience (“any occ” test). You will need to provide medical evidence that you cannot return not only to your pre accident occupation as a bus driver but also any occupation for which you are qualified due to your education, training and experience. This is usually when most insurers critically review and often deny the claim as once they accept you meet the “any occ” test it is very difficult for them to change their decision unless a significant change occurs.
Of note, employers are allowed to terminate an employee while they are on LTD benefits. However if this occurs, you may be entitled to severance (see our blog post on termination). You would also continue to receive LTD benefits in accordance with the policy provided you continue to meet the test for entitlement.
If you have any questions about your entitlement to LTD benefits or your benefits have been terminated, contact Lamont Law today for a free consultation by calling 905.529.6668.
