Denied Disability – Confused About what your Adjuster is Telling You?
Clients who have been denied long term disability benefits often tell us that they are confused about their conversations with their insurance adjusters. Here’s a quick rundown of a few basic long-term disability terms often used which can hopefully help the conversations with your case manager be a bit easier and more understandable.
Firstly – What is Disability Insurance”?
Disability insurance provides periodic payments for claimants who are unable to work due to illness or injury.
In Canada, we typically deal with three types of disability insurance coverage plans:
- Government plans such as Canada Pension Plan Disability (CPP Disability), Employment Insurance and Worker’s Compensation Plans;
- Disability Insurance can also be offered through employers or an Association as part of a group insurance plan;
- Disability policies can also be purchased directly from brokers – these plans offer more extensive protection but at a higher cost.
What is the “Elimination Period”?
People are often confused about elimination periods. Elimination period are also often referred to as a qualification period – i.e. “let’s wait and see if you will qualify for disability benefits.” The elimination period is the time at the beginning of a disability for which no benefits are payable. Common elimination periods would be 90 to 120 days from the date of your disability. For example, if you are hurt on January 1, your long-term disability policy may have an elimination period of 90 days – meaning that you would be eligible to apply for disability benefits on April 1. During the first 90 days you would have you applied for and received short term disability or unemployment insurance. Typically, the longer the elimination period, the lower disability insurance premium.
Why do I keep hearing the term “Total Disability”?
Insurers will define disability in different ways, depending on the occupation class. Policies normally require that the disability be a “total disability”. Total disability in the context of long-term disability insurance does not mean that you must be helpless and incapable of any activity, rather it is established where you are incapable of engaging in all or at least some of the important duties of a given occupation. Most disability policies provide a total disability in the first 24 months. During this time you would be paid long-term disability benefits if you were unable to perform the important duties of your own job, even though you may be capable of performing another job. This is typically referred to as “own occupation”disability.
What does a “Change of Definition” mean?
Heard your adjuster talk about “change of definition” or COD? After 24 months of receiving disability benefit payments, policies normally to switch to an “any occupation” definition of total disability. This typically means that you as a claimant must be unable to perform the activities of any occupation for which they are reasonably suited by reason of education training and experience. Some insurance companies take a step further and include “any occupation or profit” in their definition. However, rest assured that by law, you will be deemed totally disabled if you can take on only trivial or inconsequential work, or work for which you is overqualified. Change in definition means exactly what it means – it is a provision in nearly all disability policies that defines a change – a change from you being able unable to perform the regular duties of “your own occupation” to “any occupation.”
What is a Recurrent Disability?
What happens if you try to get back to work while on disability? What if your return to work is unsuccessful? Normally, disability policies will have a provision or two in them which waives the start of a new elimination period – meaning if you try and go back and if it does not work out for you, you do not have to wait another 90 to 120 days to get back on claim, as long as you are claiming to be disables due to the same or a related cause. You can normally (within 6 months) get back on claim if you are still experiencing the same illness or disability.
Have you been denied total disability?
Dealing with the complexities of a disability carrier can be a nightmare. Lalande & Company Lawyers have extensive disability litigation experience and represent claimants at all stages of a denied long term disability denied claim, from denial at the initial application to denied at the change of definition (24 months) through trial. Please contact us by filling in a contact form below or by calling is at 905-333-8888 to book a free consultation today.