By Joshua Lang, Toronto Disability Lawyer

Long Term Disability (LTD) policies are designed to provide protection and peace of mind to someone who becomes unable to work due to a disability. Essentially, an LTD policy is meant to provide an income replacement to a person who is unable to work due to a disability.  There are many different variations on LTD policies.  There are policies that are sponsored by an employer, and others that are purchased privately.  Some policies pay a benefit based on a percentage of the insured’s income, while others pay a fixed amount.

Further, the definition of disability may vary from one policy to the next, some being more restrictive and others more expansive.  For example, in one policy one may be deemed disabled only if they are unable to perform all the duties of their occupation, whereas in anther policy one may be deemed disabled even if they are unable to perform the majority of the duties of their occupation.   Because there are so many variations among LTD policies, it is important to read your policy carefully to ensure that you understand exactly what the policy covers you for.

Own Occupation vs. Any Occupation

One issue that has received a lot of attention in LTD policies is the Own Occupation test vs. Any Occupation test.  In many LTD policies, there is a “change of definition”, at which time the test for disability switches from an “Own Occupation” test to an “Any Occupation” test.   This change of definition often occurs at the two year anniversary of the disability.   In other words, a person may be deemed disabled within the first two years of disability if they are unable to perform their own occupation.  However, after two years, they may be required to prove that they are disabled from any occupation in order to meet the test for disability.   It is not uncommon for disability insurers to terminate LTD benefits when the change of definition occurs, on the basis that, although the insured is disabled from performing their own occupation, they are able to perform some commensurate occupation and earn an income similar to the income that they earned at their pre-disability job.

Terminated Disability Benefits

If your benefits are denied outright form the outset, or terminated on the date of the “change of definition”, it is important that you review your LTD policy carefully, as there are often many questions that arise around this issue.   For example, a person may be able to perform certain parts of his job, but not substantially all of his or her job duties.  Similarly, a person may be able to do some other type of work, but at a job that is not commensurate with his pre-disability job, in terms of prestige or pay.   It is important to note that “total disability” does not mean absolute helplessness.  At the same time, if the decision to stop working is merely a lifestyle choice, an insured will not qualify for LTD benefits.  An insured’s disability must be the driving force behind him or her stopping work.

If your long term disability claim  has been denied, it is important that you meet with a long term disability lawyer to review your case, and advise you about your options.