Generally speaking, short-term disability coverage lasts between three to six months, while long-term benefits are often purchased for periods that last two, five, ten years or until retirement age. The cost is commensurate with the length of the policy, so shorter policies are less expensive.
The definition of disability is not as cut and dry as one would expect. In reality, it is the insurance companies who define the term for their particular organization. As you can expect, disability coverage will depend on the specific policy that has been purchased.
If you already have a disability insurance policy, make sure you understand what your premiums cover, such as:
- If disabled, are premium payments still made?
- The coverage amount you will receive each month if/when disabled.
- Are there exclusions or are any pre-existing condition clauses in the plan?
- Will benefits be taxable or adjusted for inflation?
- What is the necessary wait time prior to receiving benefits?
- Is a medical exam required to increase coverage?
- Is the policy “guaranteed renewable”?
Short-term Disability Insurance
As mentioned, short-term disability coverage generally provides compensation for up to 6 months during the time you are sick or injured. If your employer has a short-term disability plan, then the claim must be made through that plan. Since paid sick leave is not mandatory and short-term disability plans are not common, you may be eligible for Employment Insurance sickness benefits.
Employment Insurance Sickness Benefits
The Employment Insurance (EI) program is meant to provide temporary financial aid to unemployed workers due to illness, injury, or quarantine with the understanding that the situation is temporary. If you would be able to work afterwards, then you could be eligible to receive benefits for up to 15 weeks.
Long-term Disability Insurance
Long-term disability insurance benefits begin when short-term disability insurance ends, or your sick leave benefits have been exhausted, or when employment insurance benefits are completed. Most long-term disability plans will replace around 60-70 percent of your normal income, although each plan is different.
Canada Pension Plan (CPP) and Additional Options
If you are unable to work you may also be eligible for the Canada Pension Plan (CPP) which provides monthly payments to people who have paid into the plan while employed and are unable to work due to a disability. You must be under 65 years old and have a severe mental or physical disability that prevents you from working on a normal basis.
Quebec residents may also qualify for a similar program called the Quebec Pension Plan (QPP), however, there is a time lag of a couple of months on application processing.
There are also disability benefits for veterans that may provide a lump-sum payment. They are grouped into the following.
- Disability Award
- Critical Injury Benefit
- Detention Benefit
Workers’ Compensation
Yet another avenue for compensation if you injured yourself at work or have a work-related illness is worker’s compensation. However, payments may reduce your employment insurance sickness benefits.
What Should I Do if I Become Disabled?
One of the first things you will want to do is to check with your employer to find out if there are existing avenues of compensation through the company.
Step two: File a claim with your insurance company. Hopefully, your insurance policy includes disability insurance that will cover your immediate needs. Insurance companies have a knack for minimizing claims so ask questions until you understand what is or is not covered.
Step three: Call or research the CPP, and QPP methods of government compensation to determine whether they can provide any additional financial assistance.
What you may not realize is that insurance benefits may vary to offset the additional sources of compensation. The goal is to find the best set of options that will provide the highest amount of total compensation. It can get confusing if you don’t know how to navigate through the system.
DWA LAW Can Help You Get the Compensation You Deserve
What should be straightforward is often complicated from confusing insurance policies and government assistance requirements. Rather than snap up what seems to be the most expedient route, take time to uncover all of your options to make sure you are getting the ultimate combination in financial relief.
Our attorneys are highly experienced in both short- and long-term disability issues and work diligently through the maze of options to ensure you are getting what you deserve. Schedule a complimentary consultation to better understand how we can help save time and money. Call 1-866-696-0300 or contact us here.
