Short-term disability is a type of disability income insurance that provides periodic payments to a disabled claimant when he or she is unable to work because of a chronic illness or injury. In order to understand short-term disability, it’s important to understand the overall types of disability insurance coverage in Ontario.
Firstly, there are government plans which provide disability benefits such as the Canadian pension plan (CPP), the Québec pension plan, unemployment insurance and workers compensation (WSIB) plans. These plans offer very limited financial protection as part of Canada’s Social Security benefits.
Secondly, disability benefits can be offered through group benefit plans offered by your employer or association. These types of benefits generally offer more limited protection, but at a lower cost to the insured (or the employer).
Thirdly, disability benefits can be provided by an individual policy that is purchased directly from an insurance company on a client by client basis. Individual disability policies often offer the most extensive protection, but at a higher premium cost to the insured.
Typically you would talk to your benefits administrator or your HR department and obtain a short-term disability application package. Most short-term disability packages will contain a plan member statement, a plan sponsor statement and an attending physician statement.
The plan member statement will be a questionnaire asking about your condition, how it occurred, your overall medical history and any expected income while you are on short-term disability. The plan member statement will most likely include a direction or authorization which allows the insurance company to communicate with and obtain clinical documentation from your doctor concerning your health and disability. The attending physician statement will be signed by your doctor and provide a diagnosis and prognosis of your overall condition. All clinical findings should be included on or within the statement. The attending physician statement will also require your doctor to forward any specialist consultation notes.
Once the insurance company has received your application, your attending position statement and clinical documentation a case manager or adjudicator will be assigned a manager claim to review your application. Your case adjudicator will contact you to gather any missing information, conduct a telephone interview to discuss your claim, and answer any questions you may have about the process. If you are unable to communicate by phone for any reason (e.g. hospitalized) your case adjudicator should make other arrangements to communicate with you or your power of attorney to discuss your claim.
Your case manager must not work an adversarial manner with you. Rather, the case manager must provide a reliable and timely decision on your claim as to whether or not you meet the definition of total disability. That case manager must also provide clear and concise and reliable answers to any questions that you may have about your claim.
After all the required information has been gathered, your case manager will review your claim to determine your eligibility for benefits based on your group benefits contract. If your claim is approved, you will probably receive a letter from your insurance company advising you of the amount of your monthly benefit and the expected duration for which your short-term disability claim will be paid. The letter may include your initial or retroactive payment. If you completed the direct deposit authorization on the application form, your short-term disability benefit will be deposited directly into your bank account. You will also be provided with details of what to expect from the ongoing claims process.
Your doctor needs to provide a clear diagnosis and prognosis to the insurance company. In addition, most policies mandate that you need to be any treatment program or follow appropriate treatment recommendations by your doctor to promote your overall recovery. It is your doctor’s clinical notes and records that will be provided to the insurance company to help them adjudicate your claim.
Typically you would receive short-term disability benefits if you satisfy the definition of total disability as per your contract, meaning that you are not able to perform the substantial duties of your own occupation for the maximum benefit period. The maximum benefit is the term chosen by your employer that is defined in your certificate of coverage.
Monthly short term disability payments are based on a percentage of your pre-disability income at the time you are approved for LTD. Typically the benefit is a percentage of your weekly earnings that is specified in your individual policy or your employee benefits booklet.
This is dependent on whether or not you are your employer paid your premiums, or perhaps a mix of both. Benefit taxability is determined on how your premiums or paid. For example, if your employer or employee paid the disability premiums on a pretax basis, then the benefits would be taxable. If you paid for your premiums after taxes, then the benefit would be nontaxable.
If your illness or injury is expected to cause you to remain off of work at the end of your maximum benefit period, then you will need to convert your coverage to long-term disability benefit coverage. Long-term disability will continue to be paid to you so long as you satisfy the definition of total disability as set out in your disability policy. Most long term disability benefits begin about 120 days after the onset disability, but it’s important that you do not wait until the end of the elimination period before filing your disability claim.
We understand that being unreasonably denied your short-term disability benefits can be stressful and frustrating. If you suffer from a chronic condition or serious injury that prevents you from working – and you have wrongfully been denied your short-term disability benefits – call our Hamilton Disability lawyers today at 905-333-8888 or send us a confidential email and we would be more than happy to sit and speak with your about your situation, at no cost to you. Our Hamilton Disability Lawyers have been representing disability claimants at all stages of disability since 2003 and have litigated against some of Canada’s top disability carriers.