Better knowing your LTD group policy

Better knowing your LTD group policy

By Nainesh Kotak

No document is more important to your long-term disability claim than your group policy. When it comes down to it, the relationship between the insured person and their insurance company is governed by that contract, which is why it’s the first thing we ask our clients to provide when they’re having trouble getting their benefits paid.

Unfortunately, these policies are not very user-friendly – even experienced case managers at insurance companies can struggle when it comes to interpreting their complicated legal language. Still, they rarely err in favour of the worker, in my experience.

Each individual policy is different, but the good news is that many of the key terms are often the same, no matter who your employer or insurance provider is.

To help you better understand your group policy, we’ve defined some of the most important phrases you’re likely to encounter below. And if you need further guidance, our lawyers are only a phone call away.

Understanding the terms of your group insurance policy

Own occupation: Under group policies, long-term disability coverage typically kicks in when a person can convince their insurer that they have becomes “disabled from performing the essential duties of their own occupation.” More simply, it means that you’re covered when your disability prevents you from doing your regular job.

Totally disabled: After receiving benefits for 24 months, the test for continued coverage generally switches from the “own-occupation” test to the “any-occupation” test. This means insurers will attempt to cut you off unless you can demonstrate you’re “totally disabled from performing gainful employment in any occupation for which you are qualified or may reasonably become qualified by training, education or experience.”

It’s a much tougher test to meet because you must prove that your disability leaves you unable to do any other suitable work, rather than just your own job.

Many clients come to us at this point in the process because it’s such a popular juncture for insurers to terminate benefits.

In the weeks and months before the two-year anniversary of your claim, you may find your insurer proposing a transferable skills analysis or alternative occupations. Don’t be surprised if you find their ideas nonsensical, because it’s not unusual for them to make suggestions that fall well outside the worker’s skill set.

Courts set a baseline for gainful employment

Gainful employment: The courts have helped us clarify the meaning of this term by relating it to pre-disability wages. The idea is that employees who are fit for some types of work should not be forced back for just any job at any pay grade, since it’s not fair for benefits to be terminated just because you can do a few hours of work.

While some group policies set their own rate, judges have set the baseline for “gainful employment” at 60 per cent of a person’s former salary.

Offsets: Group LTD policies typically allow insurers to deduct from benefits the money you receive from some other sources because of your disability. The most common offsets relate to Canada Pension Plan disability payments, Workplace Safety Insurance Board benefits, severance payments, and retirement allowances granted by some employers.

Even if you’re not receiving money from any of these sources, you may need to pay attention to offset clauses, because some contracts allow the insurer to estimate what you could have been paid and deduct the amount anyway.

In addition to ensuring that inappropriate offsets are not being claimed by insurers, we often help clients apply for some of these other benefits when they may be eligible. If an application is successful, that’s great. But when one is denied, it serves as proof to your insurer that you tried, and they won’t be able to apply that deduction.

Return to work stalled by recurring symptoms

Recurrent disability: When an LTD recipient attempts to return to work, only to stop again shortly after because of the same issue, a “recurrent disability” clause allows them to skip the waiting period that normally comes with a fresh claim and continue receiving benefits immediately.

Depending on the specific terms of the policy, the claimant may have to start from scratch if the period of work between benefit payments lasts for a longer time, typically six months.

If you decide to work with a disability lawyer to handle your claim, please have a look at our blog post for tips and key questions to ask a lawyer before hiring one.


We understand that being denied short-term disability or long-term disability benefits can be devastating. Your time to fight your disability insurance company is limited. Please do not delay in calling a short- and long-term disability claim lawyer at Kotak Personal Injury Law. We have successfully sued numerous disability insurance companies including Manulife, Sunlife, Desjardins, Cigna, Great-West Life, Equitable Life, Empire Life, London Life, Blue Cross, AIG, SSQ, RBC, Industrial Alliance, Canada Life, Fenchurch, OTIP, Teachers Life and more.

Call your trusted long-term disability lawyers at 1-888-GOKOTAK (Toll Free for all of Canada), or (416) 816-1500 (Local Number for Ontario Residents), (403) 319-0071, (587) 414-1010 (Local Numbers for Alberta Residents). Our consultation is free, and we don’t get paid until you do. We represent disabled people throughout Ontario and Alberta, including Toronto, Mississauga, Brampton, Milton, Georgetown, Orangeville, Oakville, Burlington, Hamilton, St.Catharines, Niagara Falls, Stoney Creek, Kitchener/Waterloo, Cambridge, London, Windsor, Markham, Pickering, Oshawa, Peterborough, Keswick, Kingston, Ottawa, Banff, Brooks, Calgary, Edmonton, Fort McMurray, Grande Prairie, Jasper, Lake Louise, Lethbridge, Medicine Hat, Red Deer, Saint Albert and other locations.