The threat of termination looms over injured workers from the moment they begin receiving long-term disability (LTD) benefits.
However, the risk peaks after two years of receiving benefits due to a change in the definition of disability that typically occurs around that date.
It’s important to remember that the wording and terms of individual LTD policies will differ. Still, for many insured people — especially those covered by group policies — the test for LTD coverage in the first two years after an accident requires that workers are totally disabled from performing the essential tasks of their “own occupation” to receive benefits.
Beyond the two-year mark, the policy wording usually requires an insured person to be totally disabled from “gainful employment in any occupation.” Some policies will spell out a definition for other kinds of suitable work, but in general, this includes jobs for which are person is qualified or may become qualified based on their training, education and experience.
Claimants will usually receive a letter in advance of their two-year anniversary in receipt of benefits explaining the new test. For many, that initial correspondence is swiftly followed by a termination letter explaining why their LTD insurance provider believes they no longer qualify for benefits under the new test, which is much tougher to meet.
If you receive the dreaded letter of termination — whether it comes at the two-year mark or another time — here are the six steps you should take before heading to court to challenge the decision.
Step 1: Understand your denial
Just because a termination of benefits arrives around the two-year mark does not necessarily mean that the change in your policy’s disability definition is the reason. Your termination letter will detail the LTD insurer’s reasons for its decision to cut your benefits, so you should read it carefully to ensure you know what issue you are dealing with.
Step 2: Doublecheck your LTD policy’s appeal provisions
When insurers terminate benefits, most offer an internal appeal process for those who want to have the decision reconsidered for any reason. The actual value of this type of review system is open to debate since it rarely results in a reversal.
However, you may not have a choice in the matter since some LTD providers specify in their policies that engaging with the internal appeal process is a mandatory step before you can proceed with a claim in court.
Whether or not the internal appeal process is compulsory, you must keep a close eye on the timelines to ensure that you do not miss any deadlines for challenging a decision. This is particularly important when it comes to litigation since it can be challenging to bring any kind of legal action in court after the limitation period has expired.
Step 3: Consider your job options
If your insurer’s denial of benefits does turn out to be based on the tougher “any occupation” test that applies after two years of receiving benefits, either your termination letter or your LTD policy may include further guidance on the types of work that would be suitable for you.
In general, insurance companies cannot expect injured workers to take on any job for which they are suited. In fact, many LTD policies include a threshold for “gainful employment” in a different occupation, based on a proportion of the claimant’s pre-injury salary — often, but not always, set at 60 per cent.
Step 4: Keep your doctors in the loop
Medical evidence from a family doctor and other specialists is often key when obtaining LTD benefits, and it is just as important when challenging a termination.
If your health professionals formed an opinion that your injuries prevented you from returning to your old job, then you need to let them know that the test for coverage will change after the two-year mark, so that they can update their views to address your fitness for any other kind of work.
Step 5: Apply for CPP disability benefits
If you haven’t already, this is also a good time to apply for Canada Pension Plan disability benefits, especially if your healthcare providers believe that your injuries will continue to prevent you from obtaining employment for a prolonged period.
LTD providers are generally entitled to offsets for CPP disability benefits. Your insurers may be able to deduct these amounts based on your potential eligibility for CPP disability, even if you are not receiving benefits.
Step 6: Contact a lawyer
The period following a denial of LTD benefits can be a lonely and scary time, but you do not have to go through it alone. An experienced long-term disability lawyer in Oakville can assess your case and help you fight back, ensuring that you are in the best position to get the benefits and compensation you deserve.
If you are worried about a potential denial, termination or interruption to your LTD benefits, feel free to contact me or another team member at Edwards Pollard or simply call (289) 529-0404.
