If one of your plan members becomes disabled, his or her personal savings, loans or spousal income may not provide sufficient resources for maintaining the basic necessities of life. Group disability insurance benefits help ensure your plan members continue to have a source of income should they meet the definition of disability and be unable to work for certain periods of time. Long-Term Disability tends to mirror the definition for Canada Pension Plan-Disability Benefits. Most plans consider someone disabled if in the first two years they are unable to perform their own occupation, and any occupation (total disability) they are reasonably qualified to do if they are off work longer than two years. You will be required to submit medical information completed by your physician(s), and you may be asked to see an independent medical examiner at the cost of the insurance company in order to verify your disability both initially and on an on-going basis.

Most LTD benefits start 120 days after leaving employment (since EI Sickness Benefits are 15 weeks plus 2 weeks waiting period = 119 days). Your LTD benefit may be for only a specific length of time (ie 2 years) or may last until retirement. Most LTD benefits pay 50%-70% of your previous income. Most do not have indexing for the rate of inflation. If during employment you paid 100% of the LTD premium cost, then your LTD income is not taxable, otherwise your LTD is a taxable income. Most contracts also have a provision that money from other sources such as CPP-D are deducted dollar-for-dollar from your LTD income.

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