Articles Posted in Long Term Disability Claim (LTD)

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A Long Term Disability policy of insurance (LTD Policy), is a policy designed to cover the insured for a monthly benefit in the event that person becomes disabled.

These policies are often offered by employers, to employees as a part of their benefits package. It’s a common perk of employment. Like saying that you work at Google, and they offer a generous benefits package. That package includes LTD Benefits. The nice thing about this is that the employee has a benefits package. The bad thing about it is that the employee doesn’t have much say about what goes in to that benefits package, how much those benefits are worth, and the benefits will likely cease when the employee ends his/her employment relationship with the employer. No longer an employee of Google? Then no more LTD benefits are available to you.

Other times, LTD Benefits are purchased privately through an insurance broker. In this instance, the policy holder (that’s you) gets to pick the right amount of coverage which best suits their lifestyle and financial situation. The LTD benefits are NOT tied down to a specific employer. They follow the insured person from job to job. These benefits are great for contractors, self-employed persons, people who don’t have benefits offered through their employer, or even people who have benefits offered through their employer, but just want additional coverage because the coverage offered through their employer isn’t necessarily the best.

Some of the large companies who offer LTD benefits (both group and individual policies) are Great West Life, Canada Life, Sun Life, Standard Life, Manulife, RBC Insurance, Industrial Alliance, Co-Operators Insurance, Desjardins, SSQ and Equitable Life just to name a few.

As you can see, there are quite a few LTD Insurers out there to chose from. It’s important to note that each policy is different. What’s most important to the insured, is how the policy works to get you paid in the event of disability.

The term “disability” is a VERY broad term. Don’t believe me? Here are a few insurance examples from car insurance policies, and LTD policies which define what it means to be “disabled” to receive benefits under their policies.

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Our law firm litigates countless Long Term Disability (LTD) claims against large, multi-national insurers such as Great West Life, Sun Life, Manulife, Industrial Alliance, Desjardins, SSQ, Canada Life, Empire Life, RBC Insurance, Co-Operators, Equitable Life and the list goes on.

Litigating these claims can prove to be difficult for a variety of reasons.

It’s important for all claimants to understand that these claims are based on what the policy says. In our office, we refer to this concept as the four corners of the insurance policy.

There are certainly ways around these four corners, along with way at tackling damages for LTD claims which are outside of the scope of the police such as punitive, aggravated and damages for mental distress. But these topic will not be covered in this edition of the Toronto Injury Lawyer Blog Post.

For now, we are going to focus on damages under the LTD policy.

The policy will define what the monthly LTD benefit amount is; how long benefits will be paid for; when those benefits will begin to be paid; what medico/legal definition a Plaintiff must meet in order to be considered disabled under the policy; what injuries are and aren’t covered under the policy; and what exclusions would limit recover under the policy.

Plaintiffs/Claimants don’t write their policy. Insurance companies do. Accordingly; many provisions contained in long term disability policies aren’t there to protect claimants. Rather, they are there to protect the insurer’s interests so as to mitigate their damages and minimize any potential pay out.

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In Ontario, injured parties who are seeking for compensation generally have 2 years from the date of the accident, or the date of denial to sue. With the exception of minors and sexual assault claims, this is the general rule of thumb which it should not be taken lightly.

This two year period in which Plaintiffs have to sue is called a “Limitation Period“. And if you miss that limitation period to commence your claim, then you’re out of luck.

We have a specific Act in Ontario devoted specifically to limitation periods. It’s called the Limitations Act, 2002 and it sets out the time periods in which you can, and can’t commence a claim.

Determining when a limitation period begins to run in a car accident, or bike accident case is pretty easy. The time begins to run from the date of the accident itself. It doesn’t take a rocket scientist, or an elite personal injury lawyer to figure this out.

BUT: what happens when the triggering event from when time begins to run isn’t as clear as a car accident. What happens in cases not caused by torts or negligence on a identifiable date; such as in a long term disability case for benefits which have been wrongfully denied.

That’s when limitation periods can get tricky and when disability claimants and injured parties can get tricked. Keep reading so you don’t get tricked like countless others.
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Our law firm had a record number of Long Term Disability Claims settle in the last quarter of 2014. In particular, the last month of 2014 was a mediation bonanza for our lawyers when it came resolving long term disability (LTD) disputes.

One of the things which we caution our clients on when it comes to settling LTD claims are the tax implications of the settlement.

Damages for pain and suffering are non taxable. Damages for past and future income loss are taxable. But these heads of damages apply to tort claims such as car accident and general negligence cases (slip and fall, dog bite, etc.)

But what happens for Long Term Disability Claims when it comes to tax implications for the settlement?

Look no further than the wording of your policy. I will be in there. I guarantee it!

Some policies state that benefits are taxable. This means less money in the client’s pocket because they have to pay tax on any amount recovered.

Other policies state that the benefits are NOT taxable. This is much better for the client because they don’t have to pay the tax man for any amount recovered in the case.

If you don’t know whether your LTD benefits are taxable or not, then just ask your insurance broker, union rep or even your employer who is funding the benefits. They will have an answer for you. You can also call the insurer who is underwriting the policy (Great West Life, SunLife, Manulife, Equitable Life, SSQ, RBC Insurance, Co-operators, Desjardins etc.) and ask an agent directly. They will have an answer for you as well.

Effective January 1, 2015, Revenue Canada introduced some important rule changes which impact the tax implications on any taxable LTD settlement. If you have an LTD claim before the Courts, it’s very important to understand these rule changes because they will likely impact on your settlement.
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I was recently mediating a Long Term Disability Claim on behalf of a disabled client who worked for Canada Post.

She was diagnosed with a wide variety of ailments, including but not limited to:

– Disc Bulges at various levels requiring surgery – Chronic Pain stemming from her back radiating down her legs requiring her to use a can to walk – A Major Depressive Disorder – An Anxeity Disorder – Sleeplessness – Fatigue – Constant Headaches
It was clear to all of the lawyers and staff at our office, that she was completely disabled; not just from her own occupation, but from ANY occupation for which she qualified by reason of education, training and experience. It was clear to her treating doctors and medico-legal experts that she was not a candidate to return to her old job at Canada Post, or work at ANY occupation whatsoever. Nor, was she a candidate for retraining given her age and the nature of her disability which effected her stamina, concentration, memory and abilty to work and interact with others.
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Clients always want to know what sort of damages they can claim in the long term disability case. As previously discussed in the Toronto Injury Lawyer Blog, damages in a long term disabilty case can be limiting.

Unlike a car accident case, there is usually no wrong doer, or tort feasor for the allged long term disability giving rise to the claim. It’s not like a masked bad guy came in the middle of the night and whacked the Plaintiff with a baseball bat and caused them to suffer from fibromyaligia, depression, anxiety etc. Normally, the disability giving rise to the claim is an unfortunate health condition, which nobody would wish upon their worst enemy.

In these sort of instances, when there’s no “bad guy” we can poin the finger at; then there’s no claim for general damages, or pain and suffering damages as they’re commonly known.

The money from these long term disability claims comes from the value of back payments monthly LTD payments owing from the insurer, to the insured. If successful at trial, a Judge will likely re-instate monthly LTD benefits, such that the Plaintiff continues to get paid on a month to month basis.

But clients always want to know what other damages are available in these sort of cases. It’s a very good question, because monthly disability benefits are capped at the monthly disability amount, less any set off (CPP, WSIB, etc.). This can be limiting. But there is potentially more compensation available to a claimant, depending on the nature of their claim.
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Our law firm sees some very seriously injured accident victims and disability claimants. Many of our long term disability clients who have cases against large multi national insurers such as Manulife, SunLife, Great West Life, Standard Life, Desjardins, Industrial Alliance, SSQ, Equitable Life etc; want to know how an insurer can place a dollar figure on their disability and inability to work for the rest of their lives.

For a disability claimant, the answer to this question can be very simple. If I can’t work for the rest of my life, then naturally, I should be entitled to MILLIONS of dollars worth of compensation. Afterall, my pain and suffering is immeasurable.

One of the most common misconceptions in long term disability cases is that claimants are entitled to damages to compensate them for their pain and suffering. This is NOT true. At our Law Firm, we refer to LTD cases as “four corner” cases. That means that your damages, or benefits, are limited to what the four corners of the policy provide for. If you have a bad policy, which, based on the wording of the policy will not properly compensate you in disability benefits; then your award will reflect that.

There are some situations where awards in long term disability cases can fall outside of the four corners of the policy.
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How does an insurer, judge or jury assess one’s pain level? If their pain is not showing up on any x-ray, scan, or test result, then how does a Court truly know that the claimant is in pain; and in fact telling the truth?

What’s stopping somebody from simply making a claim that they’re disabled, and lying to their doctor and to the Court alike?

How do we know that somebody is telling the truth about their subjective pain, fatigue or other cognitive difficulties (loss of memory, sadness, fatigue, loss of concentration etc.)?

These are all very good questions. Believe it or not, our the way that personal injury claims and long term disability claims work in Ontario make it pretty clear who’s faking, and who’s not.

First, we have to draw a distinction between an objective injury vs a subjective injury. An objective injury is one that will show up on an xray, scan or test. A factured ankle. A broken femur. A cranial facture. A hematoma on the brain. All of these are injuries which will show up on a test, which any doctor, or non-medical person can likely see. It’s pretty hard for an insurer to refute an ankle fracture injury when the x-ray clearly shows that the ankle is fractured.
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This week’s entry comes straight from the Toronto Injury Lawyer Blog reader mailbag.

Question: Goldfinger: Love the Blog. Hate the new head shots. But seriously, my wife and I are looking at getting insurance. You know. We were curious about life, disability, critical illness etc. You see it all. What should we be looking out for when buying our insurance. Best Regards JJ + PJ
Well JJ and PJ, thanks for your question. Always nice to hear from our readers.

NOTE: Lawyers don’t sell insurance. We sue insurers after they’ve denied your claim.

For starters, buying insurance is not an easy decision. For starters, I could count of a million things more exciting than insurance to spend your hard earned dollars on. On top of that, insurance can be expensive.

Secondly, have you ever read an insurance policy? They’re long, boring, and very difficult to understand. You really need to be a lawyer to truly understand what they’re trying to say. And even then, some clauses and and definitions contained in those policies are subject to one’s interpretation. Any ambiguity contained in a policy will be interpreted in your favour: BUT: do you really want to have to retain a lawyer and fight in Court for years and years over benefits, when you could have just saved the trouble and hassle and received them now? That’s just a big pain in the you know what; not to mention all of the unnecessary stress and anxiety which might come with involved in being in litigation with a large deep pocketed insurance company. Hey: sometimes it’s necessary. That’s what we’re here for.

Here are a few tips I’ve learned from litigating life insurance, disability insurance and critical illness insurance policies throughout the years.
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You’ve been involved in a car accident, or you’re involved in a dispute against your Long Term Disability Insurer. The adjuster for the insurance company tells you over the phone, or in an incomprehensible letter that they want you to attend a medical examination with a doctor you’ve never heard of.

You don’t know who this doctor is.

You don’t know where their office is located.

You don’t know how you’ll ever get there because transportation has been difficult for you since your accident or disability.

You don’t know why you have to attend the examination.

You don’t know what the examination is for, how long it will last, what tests will be administered.

You have about a million and one other questions about the examination, and you have nobody to turn to.

Enter a Personal Injury Lawyer.
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