Long Term Disability Law can be rather complicated.
It’s complicated because Long Term Disability is based in contract, and every contract is different.
For many people, understanding the words and concepts contained in these long term disability contracts is hard to grasp, and confusing. I can’t say that I blame them.
Take a dog bite case for example. If a dog attacks you, and causes injury to you, then the owner of the dog ought to be held responsible for your injuries and losses.
Long Term Disability cases don’t work that way. Simply because you are disabled, or unable to return to work, does not necessarily mean that you are entitled to long term disability benefits.
And, even if you are eligible for long term disability benefits, the quantum of that benefit, along with the payment duration will be in question as well.
There are a lot of fluctuating variables when assessing and quantifying a long term disability case. We call these moving targets. Those targets don’t move as often, or as frequently, with a straight tort claim, like a dog bite case, as they do with a long term disability claim.
In some ways, qualifying for CPP Disability is easier than it is to qualify for long term disability benefits with a private insurer.
One of those ways is the qualifying period. This is the minimum period of time you would need to work in order to qualify for benefits.
Take this example:
John starts work. But after just 1 day of work, he becomes disabled and cannot return. John has a long work history spanning over 20 years with different companies. John’s company has long term disability benefits with Insurer X. John makes a claim for long term disability benefits with Insurer X. Insurer X denies John’s long term disability claim because he was not worked enough days with that specific company. He has only worked for just 1 day with that company. John has not met the minimum qualifying period under the long term disability policy, and therefore he is not entitled to long term disability benefits regardless of how bad the disability is.
But, John can still qualify for Canada Pension Plan Disability Benefits even though he does not qualify for long term disability benefits.
Because John has a long work history of over 20 years with different companies, he has made enough contributions CPP to meet the minimum qualifying period. In order to qualify, John must have have made valid contributions to the CPP in 4 of the last 6 years, or have contributed for at least 25 years, including 3 of the last 6 years. John would qualify because of his lengthy work history with different companies and making those contributions to CPP with those different companies.
This is an example of how in one scenario you can qualify for CPP Disability Benefits, despite not being able to qualify for long term disability benefits with a private insurer.
The same can work the opposite way.
Let’s take the example of Sally, a new college graduate. She does not have a lengthy work history at all. She just got out of school and entered the workforce. Her first job had long term disability benefits through Insurer X. After working for 9 months, Sally has a terrible accident and cannot return to work. She is deemed to be permanently disabled by her doctors and unfit for any sort of gainful occupation. In this example, Sally will not qualify for CPP Disability Benefits because she has not made enough contributions to the Plan. But, she will qualify for private long term disability benefits through Insurer X because she has satisfied the minimum qualifying period; which under this policy is 6 months.
The test for CPP Disability is different than the test for disability in a long term disability policy. While these tests for disability are usually similar; they are NOT the same. It’s the fine details which can make or break a case.
Here is an example of a definition of disability from a private LTD policy:
Total Disability and Totally Disabled; mean that,
- During the qualifying period and the 24 month period immediately following it, you have a medical impairment due to injury or disease which prevents you from performing, in any setting, the essential duties of the occupation in which you participated just before the total disability started, and
- After the 24 month period, you are unable, because of the medical impairment, to perform, in any setting, the essential duties of any occupation for which you have at least the minimum qualifications.
The medical impairment much be supported by a reasonable and customary program that:
- is performed or prescribed by a legally licensed doctor of medicine, and
- is the nature and frequency usually required for the condition involved
The availability of work with any employer does not affect the determination of total disability.
You qualify for benefits when Insurer X receives proof that:
- You are absent from active work because you are totally disabled,
- You are totally disabled for as long as the qualifying period, and
- You are under the active and continuous care of a physician whom Insurer X considers to be appropriate to your total disability and you are following the treatment prescribed by that physician.
In order to qualify for CPP Disability Benefits, the applicant must show that:
- you are under 65
- you have contributed enough to the Canada Pension Plan
- you have a mental or physical disability that regularly stops you from doing any type of substantially gainful work
- you have a disability that is long-term and of indefinite duration, or is likely to result in death
Substantially gainful work is a job that pays wages equal to or greater than the maximum annual amount a person could receive as a disability pension. In 2023, this amount is $18,508.36(before tax).
The wording of both disability tests leave a lot open to interpretation. This is why the credibility and likeability of the applicant goes a long way. If the insurer, or the government, believe that you are seeking to take advantage of them and pull the wool over their eyes, they will not view your application as favourably. They will not give you the benefit of the doubt where the medical records are vague.