Employer's LTD Ends in 2 years? Questions re: LTD Insurance and Critical Illness

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Mar 12th, 2022 11:43 pm

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Mar 9th, 2022 2:06 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 9th, 2022 2:06 pm

Employer's LTD Ends in 2 years? Questions re: LTD Insurance and Critical Illness

Hi all,
I and my wife am close to 50 y.o. We have life insurance and currently, our broker is trying for us to sign up for LTD and/or CI. Both I and my wife are employees.

Few questions that I have:
1. Employer's LTD, according to our broker, will end in 2 years since we claim it. Is this true?

2. If our employer determines that we can no longer work and they decided to terminate our employment, then our LTD will be cut off too even if the LTD is still below 2 years, correct?

3. I was browsing and my impression, many people said the same thing, if we can only have a budget for either one, then go with LTD. Do you all agree?

My thinking is CI is a one-time payment while LTD goes to 65 y.o. and knowing that we have life insurance, what we concern the most if we can't work and generate income in a long period which LTD will provide monthly coverage for that and that's a better deal than having 1 lump sum payment especially if you only have room for either one of them.

Additional question:

I just came across the following: https://valentlegal.ca/long-term-disabi ... ct-my-job/ per this article, employers usually allow the two-year own-occupation period to pass and allow the claimant to remain employed for that time, however, after 2 years, my understanding, employer can safely fire you and not being accused of discrimination.

That said, if employer can provide LTD for the first 2 years, I can only think, it's better to sign up for LTD insurance with 730 days of elimination period? This will make the premium cheaper than if we sign up for LTD with a shorter elimination period. What do you all think?

Thanks all!

Last edited by slim3605 on Mar 10th, 2022 1:37 pm, edited 1 time in total.

46 replies

Mar 9th, 2022 8:37 pm

lmcjipo: Deal Addict; Sep 14, 2012; 2414 posts; 1799 upvotes; Montreal, QC

Mar 9th, 2022 8:37 pm

slim3605 wrote: ↑ Hi all,
Me and my wife are close to 50 y.o. We have life insurance and currently, our broker are trying for us to sign up for LTD and/or CI. Both me and my wife are employee.

Few questions that I have:
1. Employer's LTD, according to our broker, will ends in 2 year since we claim it. Is this true?

2. If our employer determine that we can no longer work and they decided to terminate our employment, then our LTD will be cut off too even if the LTD is still below 2 years, correct?

3. I was browsing and my impression, many people said the same thing, if we can only have budget for either one, then go with LTD. Do you all agree?

You need to read the agreement or contact the employer or find the policy regarding LTD since there are no clear cut rules for LTD.

For example, where I currently work, there are 2 employees that I know of who work in my department/unit who are still considered employees and they have been on long term disability for over 7 years.. In fact, one of these employees has been on LTD for over 10 years. I know this since I've never met this person and I've worked at this place for ~10 years and her name still shows up as working in our department/unit. With the other person, he went on LTD about 1.5 years after I started so I would estimate that he has been on LTD for close to 8 years now and his name still appears as working in our department/unit.

That being said, I don't know how much each of them are getting in terms of percentage of their salary but I would assume that it is less than their actual salary if they were actually working.

Mar 9th, 2022 10:06 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 9th, 2022 10:06 pm

lmcjipo wrote: ↑ You need to read the agreement or contact the employer or find the policy regarding LTD since there are no clear cut rules for LTD.

For example, where I currently work, there are 2 employees that I know of who work in my department/unit who are still considered employees and they have been on long term disability for over 7 years.. In fact, one of these employees has been on LTD for over 10 years. I know this since I've never met this person and I've worked at this place for ~10 years and her name still shows up as working in our department/unit. With the other person, he went on LTD about 1.5 years after I started so I would estimate that he has been on LTD for close to 8 years now and his name still appears as working in our department/unit.

That being said, I don't know how much each of them are getting in terms of percentage of their salary but I would assume that it is less than their actual salary if they were actually working.

Thx for sharing this. I realize that each employer may have different type of LTD. Maybe there are LTD for 5, 10, 15 years, up to 65, or even for life.

Does those 2 people who works at your department still coming to work everyday? Or are they just listed as employee but they never come to work?

Last edited by slim3605 on Mar 9th, 2022 10:17 pm, edited 1 time in total.

Mar 9th, 2022 10:16 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 9th, 2022 10:16 pm

nolookingca wrote: ↑ after the 2 years, they may still cover you only if you're too disabled to do /any / job.

Make sense and I believe it depend on the LTD policy as well which can be different from one employer to the others.

Also, I can only assume employer may also offer the employee a different role which more suited to the employee condition.

BTW, if, in the worst case scenario where we are too disabled to do any job, employer LTD can still cover us up to 65 or even life, then, I don't see any reason why we have to have LTD through private insurance (up to 65 as well)?

Mar 10th, 2022 12:43 am

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 12:43 am

nolookingca wrote: ↑ One case could be that you're too disabled to do your job, but not any job. Imagine you're a neurosurgeon, but your hands got shaky, and now you can work as a greeter at Wal-Mart. Are you ok with the change in the standard of living that comes with that?

If that's not your situation or you're happy with your coverage, then of course you don't need to buy more insurance.

How exactly does LTD through employer work?

Is it like the following:
1. LTD determines whether we can work our previous job. if the answer is yes, we go back to work, and LTD stop
2. if the answer to no. 1 is no, then, can we work for any other job? if yes, then, the employer will try to find another role for us. if they can offer another role, they'll offer it to us and we have to take it cause otherwise, it is ground for employment termination and LTD stop. if an employer can't offer another role, LTD continues
3. if the answer to no. 3 is no, then, LTD continues

How exactly does LTD through private insurer works?

Is it like the following:
1. the same with no. 1 above
2. if the answer to no. 1 above is no, then, LTD continues. the private insurer is not coordinating with the employer to see if they are offering any other role. the private insurers only see physician's opinions about whether we can work for our previous job, if the physician says no, then, LTD continues
3. the same with no. 3 above

Last edited by slim3605 on Mar 10th, 2022 9:00 pm, edited 2 times in total.

Mar 10th, 2022 6:10 am

RCML27: Deal Addict; May 28, 2007; 1596 posts; 931 upvotes

Mar 10th, 2022 6:10 am

nolookingca wrote: ↑ One case could be that you're too disabled to do your job, but not any job. Imagine you're a neurosurgeon, but your hands got shaky, and now you can work as a greeter at Wal-Mart. Are you ok with the change in the standard of living that comes with that?

If that's not your situation or you're happy with your coverage, then of course you don't need to buy more insurance.

The term "any job" is misleading. After 2 years, if you're still disabled, then it's not just being able to do YOUR job, but it's any job that you're suited for by education, training, or experience (or something along those line). And the other job must be able to provide something like 60 - 65% of your previous salary. Otherwise, LTD will still have to cover you.

Mar 10th, 2022 6:36 am

RCML27: Deal Addict; May 28, 2007; 1596 posts; 931 upvotes

Mar 10th, 2022 6:36 am

slim3605 wrote: ↑ How exactly LTD through employer works?

Is it like the following:
1. LTD determine if whether we can work our previous job. if the answer is yes, we go back to work and LTD stop
2. if the answer to no. 2 is no, then, can we work for any other job? if yes, then, employer will try to find another role for us. if they can offer another role, they'll offer it to us and we have to take it cause otherwise, it is ground for employment termination and LTD stop. if employer can't offer another role, LTD continues
3. if the answer to no. 3 is no, then, LTD continues

How exactly LTD through private insurer works?

Is it like the following:
1. the same with no. 1 above
2. if the answer to no. 1 above is no, then, LTD continues. private insurer is not coordinating with employer to see if they are offering any other role. private insurer only see physician's opinion about whether we can work for our previous job, if the physician says no, then, LTD continues
3. the same with no. 3 above

If you already have LTD coverage from your employer, then I don't see a need for buying extra private LTD insurance. Even if you lose your job because you're unable to go back to work while you're on disability, you'll still be covered by the employer's LTD insurance company till 65, if that's the length of coverage in your policy.

I highly suggest you watch The Disability Law Show and The Employment Law Show that plays every weekend afternoon on Global TV. It's very informative. you can even find previous shows on YouTube.

https://globalnews.ca/toronto/program/t ... y-law-show

I'm on LTD and I've learned quite a bit from these shows. In my case, after 3 years and I wasn't able to return to work in the hospital, my position got terminated, but I was still covered by LTD insurance. The only time they would stop covering me in my policy is if I was able to return to work, reach the age at which I can take my private pension without penalty, or till age 65. I recently received a letter from the insurance company saying I qualify for my private pension without penalty. So I'll have to apply for that, and if what I get is less than what they were giving me, then they'll cover the difference till age 65.

While on LTD, they may ask you to apply for CPP disability, and you should apply because if the insurance company ever cuts you off, then at least you'll still receive CPP disability. But CPP disability is a harder test to pass to qualify, so if you do get approved for it, then it's harder for the insurance company to justify cutting you off.

Mar 10th, 2022 8:17 am

teoconca: Deal Guru; Oct 16, 2008; 10287 posts; 4551 upvotes; Vaughan

Mar 10th, 2022 8:17 am

Try to apply CPP disability

...

Mar 10th, 2022 1:06 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 1:06 pm

RCML27 wrote: ↑ If you already have LTD coverage from your employer, then I don't see a need for buying extra private LTD insurance. Even if you lose your job because you're unable to go back to work while you're on disability, you'll still be covered by the employer's LTD insurance company till 65, if that's the length of coverage in your policy.

I highly suggest you watch The Disability Law Show and The Employment Law Show that plays every weekend afternoon on Global TV. It's very informative. you can even find previous shows on YouTube.

https://globalnews.ca/toronto/program/t ... y-law-show

I'm on LTD and I've learned quite a bit from these shows. In my case, after 3 years and I wasn't able to return to work in the hospital, my position got terminated, but I was still covered by LTD insurance. The only time they would stop covering me in my policy is if I was able to return to work, reach the age at which I can take my private pension without penalty, or till age 65. I recently received a letter from the insurance company saying I qualify for my private pension without penalty. So I'll have to apply for that, and if what I get is less than what they were giving me, then they'll cover the difference till age 65.

While on LTD, they may ask you to apply for CPP disability, and you should apply because if the insurance company ever cuts you off, then at least you'll still receive CPP disability. But CPP disability is a harder test to pass to qualify, so if you do get approved for it, then it's harder for the insurance company to justify cutting you off.

Thanks for sharing this!

Based on your experience, the most important takeaway for me is this: even when your employer terminates your employment, your LTD continues.

That said, LTD has nothing to do with employment status because as long as you were disabled when you were employed, the employer's LTD will continue as long as you are still disabled regardless of your employment status.

Do you have any reason to believe that this could be just due to the particularities of your situation and not a general principle?

If this applies to everyone, then, the need for LTD through private insurers becomes less important for those who have LTD from employers.

The only thing that comes to my mind is this: LTD through employer usually does not cover 100% of our income. Therefore, if we rely on 100% income to keep contributing to a retirement fund, TFSA, or what have you, then, having an LTD through a private insurer helps to cover the remaining balance that is not covered by LTD from the employer.

Another situation where LTD through private insurers becoming more important is when you are self-employed or have no LTD from employer.

Last edited by slim3605 on Mar 10th, 2022 1:35 pm, edited 1 time in total.

Mar 10th, 2022 1:30 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 1:30 pm

RCML27 wrote: ↑ The term "any job" is misleading. After 2 years, if you're still disabled, then it's not just being able to do YOUR job, but it's any job that you're suited for by education, training, or experience (or something along those line). And the other job must be able to provide something like 60 - 65% of your previous salary. Otherwise, LTD will still have to cover you.

So, if you are disabled and you can't work at your previous job but if you can work at another job but this job only pays 40% of your salary, then, LTD will still pay the difference between LTD coverage minus your current salary at this other job?

Mar 10th, 2022 6:17 pm

lmcjipo: Deal Addict; Sep 14, 2012; 2414 posts; 1799 upvotes; Montreal, QC

Mar 10th, 2022 6:17 pm

slim3605 wrote: ↑ Thx for sharing this. I realize that each employer may have different type of LTD. Maybe there are LTD for 5, 10, 15 years, up to 65, or even for life.

Does those 2 people who works at your department still coming to work everyday? Or are they just listed as employee but they never come to work?

These 2 people haven't shown up to the office or worked remotely from home since they went on LTD.

Prior to the Covid-19 pandemic closures (which I believe began March 2020), our jobs were 100% onsite and neither of these people showed up or did anything noticeable which was work related (reply to emails, etc.) When we went to 100% working from home, these 2 people still didn't do anything which indicated that they were working.

As mentioned in my earlier post, one person has been away for maybe 8 years now (I worked with him) and the other person has been away for over 10 years (I've never met this person and I've been working at my current place of employment for ~10 years).

Where I work, the LTD is I believe very generous but there are also checks that are done (I believe). It isn't just a matter of finding a family doctor who will authorize/approve the LTD. During my time, at least 2 people that I know of have tried to stay on LTD and one of them was forced to return (or quit/resign) and the other person was asked to see a different physician and wound up quitting rather than seeing a different physician for analysis (at least that is what the rumor concerning why he never came back).

Mar 10th, 2022 7:13 pm

will888: Deal Expert; Dec 12, 2009; 26049 posts; 16015 upvotes; Toronto

Mar 10th, 2022 7:13 pm

OP, there seems to be a lot of moving parts to this, you should consider professional advice instead of asking forum members to guess when they may not be privy to all the coverage details surrounding your case.

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Mar 10th, 2022 8:15 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 8:15 pm

lmcjipo wrote: ↑ These 2 people haven't shown up to the office or worked remotely from home since they went on LTD.

Prior to the Covid-19 pandemic closures (which I believe began March 2020), our jobs were 100% onsite and neither of these people showed up or did anything noticeable which was work related (reply to emails, etc.) When we went to 100% working from home, these 2 people still didn't do anything which indicated that they were working.

As mentioned in my earlier post, one person has been away for maybe 8 years now (I worked with him) and the other person has been away for over 10 years (I've never met this person and I've been working at my current place of employment for ~10 years).

Where I work, the LTD is I believe very generous but there are also checks that are done (I believe). It isn't just a matter of finding a family doctor who will authorize/approve the LTD. During my time, at least 2 people that I know of have tried to stay on LTD and one of them was forced to return (or quit/resign) and the other person was asked to see a different physician and wound up quitting rather than seeing a different physician for analysis (at least that is what the rumor concerning why he never came back).

Interesting.

One other commenter who was commenting above was terminated yet, LTD continues. In your company's case, those 2 people are still employed, yet, never returning to work while LTD continues.

Also, it looks like there are grey areas regarding the other 2 people who were forced to return/quit.

Not sure if the physician said that they were able to return to work, or, the physician report was not conclusive and the employer decided that the employee should return to work but the employee disagree as they believe that they still can’t function normally which then lead to the employer giving them work or quit choices?

Thx for sharing!

Last edited by slim3605 on Mar 11th, 2022 3:08 am, edited 1 time in total.

Mar 10th, 2022 8:19 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 8:19 pm

will888 wrote: ↑ OP, there seems to be a lot of moving parts to this, you should consider professional advice instead of asking forum members to guess when they may not be privy to all the coverage details surrounding your case.

I did meet with an insurance professional who told me that LTD from the employer expires in 2 years and this is why we need private insurance coverage. Based on what some people are saying here, LTD only for 2 years is not 100% correct. However, I agree, there are a lot of moving parts.

Mar 10th, 2022 8:55 pm

will888: Deal Expert; Dec 12, 2009; 26049 posts; 16015 upvotes; Toronto

Mar 10th, 2022 8:55 pm

slim3605 wrote: ↑ I did meet with an insurance professional who told me that LTD from the employer expires in 2 years and this is why we need private insurance coverage. Based on what some people are saying here, LTD only for 2 years is not 100% correct. However, I agree, there are a lot of moving parts.

I hope this "insurance professional" is not a salesperson who just happens to have the perfect product for you when your employer LTD supposedly expires in 2 years time. What does the company say? Surely they are approachable and can tell you next steps.

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Public Mobile $40/15GB, $35/20GB, lot less with rewards
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Mar 10th, 2022 9:03 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 9:03 pm

will888 wrote: ↑ I hope this "insurance professional" is not a salesperson who just happens to have the perfect product for you when your employer LTD supposedly expires in 2 years time. What does the company say? Surely they are approachable and can tell you next steps.

This "insurance professional" is an insurance and investment broker/advisor dealing with insurance and investment products.

I did check my company's benefit summary and for LTD it says: "2 years own occupation; any thereafter" which confirmed what people here are saying too.

Last edited by slim3605 on Mar 10th, 2022 9:08 pm, edited 1 time in total.

Mar 10th, 2022 9:03 pm

S5: Deal Addict; Oct 4, 2009; 3329 posts; 2546 upvotes; Montreal

Mar 10th, 2022 9:03 pm

slim3605 wrote: ↑ I did meet with an insurance professional who told me that LTD from the employer expires in 2 years and this is why we need private insurance coverage. Based on what some people are saying here, LTD only for 2 years is not 100% correct. However, I agree, there are a lot of moving parts.

His commission depends on you buying a product from him. Of course he has never met anyone who doesn’t need insurance…

Many LTD work plans will cover for your job for 2 years then switch to any job. You really need to read your coverage to know what your protections are.

Mar 10th, 2022 9:09 pm

will888: Deal Expert; Dec 12, 2009; 26049 posts; 16015 upvotes; Toronto

Mar 10th, 2022 9:09 pm

slim3605 wrote: ↑ This "insurance professional" is an insurance and investment broker/advisor dealing with insurance and investment products.

So there is potential conflict of interest here. It just occurred to me, generally insurance is intended to provide monetary safeguard against a possible future undesirable situation that can result in a loss. If you are already on LTD, that future undesirable situation has occurred and is ongoing. How can you be insurable for an ongoing condition?

~~Koodo $40/6GB~~
Public Mobile $40/15GB, $35/20GB, lot less with rewards
Tangerine Bank, EQ Bank, Simplii

Mar 10th, 2022 9:10 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 9:10 pm

S5 wrote: ↑ His commission depends on you buying a product from him. Of course he has never met anyone who doesn’t need insurance…

Many LTD work plans will cover for your job for 2 years then switch to any job. You really need to read your coverage to know what your protections are.

That's correct, he'll get commission and trying to sell me both critical illness and disability. There is nothing wrong trying to sell any product, insurance included. I'm here trying to educate myself to see what, if any, that I need to consider before committing buying any product.

Mar 10th, 2022 9:13 pm

slim3605 [OP]: Member; Aug 6, 2018; 217 posts; 52 upvotes

Mar 10th, 2022 9:13 pm

will888 wrote: ↑ So there is potential conflict of interest here. It just occurred to me, generally insurance is intended to provide monetary safeguard against a possible future undesirable situation that can result in a loss. If you are already on LTD, that future undesirable situation has occurred and is ongoing. How can you be insurable for an ongoing condition?

What do you mean that I'm already on LTD? Do you mean I am now disabled and on LTD? Or, do you mean I have LTD from my employer?

I am not disabled and have LTD from my employer and I think that I can think of 1 reason if I want to have LTD from the private insurer: LTD from an employer does not cover 100% of our salary, so, a private insurer can cover the remaining balance if we need full income which we relied on to contribute to our retirement, tfsa, etc.

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