If you are wondering whether you can apply for Long-Term Disability (LTD) benefits under your previous employer’s insurance policy, even though you are no longer employed by them, you are not alone. This is a question that we have been asked countless times by hundreds of people, over the past 20 years of us practicing LTD insurance law.
As you may have anticipated, the answer is not as simple as “yes” or “no”. As with most answers to legal questions, the answer to this question starts with “it depends”.
In this article, we will attempt to answer whether you may be eligible for LTD benefits under your former employer’s insurance policy by exploring some of the most common ways in which this issue arises and ultimately, plays out in litigation.
To help you understand this complex issue, we will go through some real case examples with the hope that you may see your set of circumstances in this article and gain a better understanding of whether you may be eligible to apply for LTD benefits after your employment has terminated.
That said, all cases are different and one subtle difference might alter the outcome in your particular case. Therefore, it is always best to discuss the specific details of your claim with an experienced LTD insurance lawyer, rather than rely on information you might find online. We offer free consultations for that very purpose and we encourage you to contact us if you have any questions regarding LTD benefits or anything you read in this article.
Before we can determine whether you may still be eligible for LTD benefits under your former employer’s policy, we will need answers to a number of important questions. The answers to these questions will help us go from an “it depends” answer to a “yes” or “no” as to whether you may be entitled to LTD benefits if your employment has been terminated.
Over the years, we have had many clients like you come to us distraught that their employment has been terminated and they are unable to work (anywhere else) due to an illness/injury and they would like to know whether they are able to apply for Long-Term Disability (LTD) benefits.
The first step is always to find out whether you ever had LTD coverage under your former employer’s policy. You may already know the answer to this or you may need to do a little digging. You can go back to your former employer and ask or you can contact the insurance company who provides the insurance or you can look at your paystubs, where you may see deductions specifically for LTD coverage.
Once you know whether you had LTD coverage, you will want to know if your LTD coverage has been maintained for you beyond the date your employment terminated. Generally, LTD coverage is maintained by the employer through the notice period (the period immediately following the termination of your employment, which may vary in length). If there is no mention of maintaining your LTD coverage in your termination letter, you can ask your employer when they terminated or will terminate your LTD coverage.
It is also going to be important for you to get your hands on a copy of your employer’s group LTD policy. Your employer will have a copy, as will the insurance company. You can ask either one or both if you do not have one. Typically, the employer will have provided you with or will give you a Benefit Booklet only. This is not the same as the actual policy; the Booklet is a brief summary of the LTD coverage, terms and conditions. The policy is a legal contract that includes all the relevant and important terms and conditions of coverage and eligibility for benefits. To be fully informed about your rights to LTD coverage and benefits, it is important to refer to the actual policy.
The answer to the next question is critical to your eligibility for coverage. What is your date of disability? In other words, as of what date were you no longer able to perform the essential duties of your own occupation (some policies say “any occupation”) due to an illness or injury. When discussing eligibility for LTD after your employment has been terminated, it will be critical for you to demonstrate that you are not able to work due to an illness/injury and not because you no longer have a job with your former employer.
Depending on when you became disabled (which will need to be confirmed using medical records and reports, going back to around that time), you may or may not have coverage under your employer’s LTD policy. For example, if you became disabled while you were employed or during the notice period, your LTD coverage was likely still in force as of that date and you would be eligible to submit an LTD claim.
Similarly, if you were on sick leave/STD when your employment was terminated, you would still be eligible to submit an LTD claim, even if your LTD benefits might not start for weeks or months into the future. In other words, if your employer terminated your employment during the “waiting period” for LTD benefits, you can still make an LTD claim.
The “waiting period” is a period of time that you will need to be continuously disabled before LTD benefit payments will start being paid to you. Whether or not your employer paid short-term disability benefits to you or whether or not your STD benefits were terminated when your employment terminated, you are very likely to still be eligible to submit an LTD claim.
On the other hand, if you became disabled after your employment was terminated and after the notice period and after your LTD coverage was cancelled, then you are probably not eligible to claim LTD benefits. However, there are at least a couple of exceptions or instances in which you may still be able to make an LTD claim.
Most LTD insurance policies provide for an interruption in disability during the “waiting period” for LTD. For example, if you had been on sick leave/STD prior to the termination of your employment and then you returned to work for a short period of time (the maximum time allowed will be set out in your policy) and you were unsuccessful in your return to work (perhaps work aggravated your condition and you had to stop or your employment was terminated which then caused your disability to recur), then you may still be able to submit an LTD claim.
The second exception or instance in which you may still be eligible for LTD benefits even after your LTD coverage has terminated is if you have a “recurrent claim”. A “recurrent claim” is when you become disabled again for the same or related cause within a certain period of time stipulated in the policy (often it is a period of no more than six months). For example, if you were on LTD and then you returned to work and worked for a period of fewer than six months (or whatever the recurrent period is in your policy) and you become disabled again, even if your employment has terminated, you can submit a “recurrent” LTD claim. If approved, there would be no new waiting period and benefits would pick up again, where they left off.
Believe it or not, the situations or circumstances detailed above are fairly simple. We have successfully disputed much more complex LTD denials where coverage has been an issue.
For example, the issue of eligibility is often disputed if you were on a leave of absence (paid/unpaid) for some other (non-illness related) reason when your employment and LTD coverage terminated. Your employer may or may not have maintained your LTD coverage while you were on leave. They may or may not have given you the option to maintain the coverage. The insurance policy might not allow for the coverage to be maintained during some leaves of absence. Determining eligibility in these circumstances can be complicated and requires a thorough and detailed review by an experienced LTD insurance lawyer.
Another tricky situation is if you were attending work and being paid, but not actually able to perform the duties of your own occupation before your employment was terminated. In that case, the argument may be that you became disabled while you were still employed and actually at work. Determining eligibility in this circumstance can be complicated and requires a thorough and detailed review by an experienced LTD insurance lawyer.
You would also have a hotly disputed LTD claim if you returned to work for a different employer after your employment was terminated and then became disabled either before your new LTD coverage took effect or even the first one year of having the new coverage. Believe it or not, you may still have a valid claim under your previous employer’s LTD policy. Again, this is a complicated type of LTD claim and requires a thorough and detailed review by an experienced LTD insurance lawyer.
These are only a few examples of the more complex types of situations that we come across in our LTD insurance practice. If any of the above set of circumstances sound familiar to you, it is important to reach out to us if your claim has been denied or better yet, to contact us early on, even before you submit your LTD claim so that we may guide you through the claims process, with the goal of avoiding a denial and subsequent lawsuit.
You might be surprised that your LTD claim is approved. While we as LTD lawyers only see the worst of the worst in LTD claims adjudication, we know there are experienced LTD case managers out there who know how to adjudicate claims where employment issues are involved and how to apply policy provisions properly and in good faith. For that reason, we encourage you to submit an LTD claim, even if you are doubtful your claim will be approved. If your claim is not approved, then we will know exactly why it was denied and we can work to form a strategy to challenge the denial. Contact us if you need help with your LTD claim.
If you do submit an LTD claim, remember the first thing the insurance company will do is determine whether you are entitled to the coverage–not whether you are totally disabled and entitled to benefits. If the insurance company says that your LTD claim is denied because are not covered under your former employer’s LTD policy, they will explain why they are taking that position and you will know what you will need to prove if you want to challenge the decision by way of an appeal to the insurance company or by way of a lawsuit. If your claim is denied based on you having “no coverage”, we encourage you to contact us for a free consultation to determine whether it makes sense to dispute the denial and if so, to determine the best strategy for doing so.
If the insurance company determines that you have LTD coverage, their next step will be to assess your claim. They will review your claims forms and medical records and speak with you and have your records reviewed by their internal medical consultants. They will look at everything you submit to determine whether or not you satisfy the definition of disability under the insurance policy. They may or may not approve your claim, based on their assessment. If your claim is denied for any reason, we encourage you to contact us for a free consultation to determine the best strategy for disputing the denial.
When our clients’ LTD benefits are being denied based on a lack of coverage, we need to take extreme care to balance our clients’ LTD interests with their employment interests. This can be exceedingly tricky and a strategic and measured approach is critical to ensure that neither employment nor LTD insurance rights are jeopardized.
While there are a number of issues that arise when disability and employment terminations intersect, perhaps the most concerning to us, as LTD lawyers are the terms of the termination, the employment, and any documentation that our client may have signed when their employment was terminated. Often, unbeknownst to our client and sometimes to their employment lawyer (to whom they may not have mentioned that they were disabled), how the settlement is characterized and paid out and the specific release terms and conditions can seriously impact our client’s LTD coverage and benefit amount.
If your employment has been terminated and you are not able to work due to an illness/injury, it is important to contact us to work out a strategy whereby neither your employment nor LTD entitlements are at risk. If you already have an employment lawyer, that lawyer may be able to handle your LTD issues or may suggest you contact a lawyer (such as us) who focuses exclusively on LTD claims and litigation. LTD insurance law can be complex and we are happy to either manage both employment and LTD claims to ensure a coordinated approach or work with your employment lawyer to reach the best outcome of all issues.
Applying for LTD is a difficult task, at the best of times, and even more so when you are struggling with employment issues. It is important that you get help where you can to ensure that your application is complete, accurate and most of all, persuasive to your insurance company to increase the likelihood that your claim will be approved and to avoid the stress of appealing or litigating a denial.
From decades of experience litigating LTD claims where employment issues come into play. One of our partners even has experience litigating LTD claims from both sides (as in-house counsel for insurance companies defending LTD claims and as plaintiff’s counsel, representing disabled persons in their complex LTD disputes with all insurance companies in Canada), we know that LTD claims are often denied due to “no coverage” or other employment-related issues. We understand why these claims were not successful and how to persuade insurance companies of their legitimacy and resolve these disputes for our disabled clients.
Together, our three law partners have over 50 years of LTD litigation experience representing professionals, self-employed individuals, teachers and all other types of employees with a variety of medical conditions. It is our hope that the information we have provided here will increase the likelihood of these claims being approved early on so that you can focus on your recovery and eventually, returning to work.
We encourage you to contact MK Disability Lawyers if your STD or LTD claim has been denied or terminated by your insurance company. We offer free consultations to help you decide whether to appeal the denial of your claim or whether to proceed straight to litigation. Remember, there is no requirement that you appeal the denial or termination of your STD/LTD claim. (Note: Unionized employees may be required to grieve STD and/or LTD denials/terminations, depending on the wording of their collective agreements. We are able to review collective agreements for jurisdiction over STD/LTD issues.)
As an added support, we are offering free consultations at the sick leave, STD, LTD application stages. If you are considering sick leave and/or considering applying for STD or LTD, we encourage you to contact us to schedule a time for us to discuss the details of your disability claim. We will discuss the claims process with you, provide you with direction with respect to what to include in your initial claim and review of your claims forms before you submit them. Every claim is different and it is important that you use wording and provide medical evidence that will be most supportive and persuasive to the insurance company and result in the approval of your claim.
We appreciate that there are a number of resources available to help you in your LTD claim application and appeal. Unlike many other resources provided by your employer and insurance company and union and employment lawyer, we have the unique perspective that comes only from seeing and litigating countless LTD that have been denied or terminated and we can use that insight and experience to help you avoid those outcomes. One of our partners, Courtney Mulqueen, also has the added insight that only comes from having worked for insurance companies defending LTD claims.
If you have specific questions about LTD claims that have been denied for a lack of LTD insurance coverage or for any other reason, please contact us to schedule a free individual consultation. We also invite you to visit our website www.mkdisabilitylawyers.com, where you will find an extensive collection of blog articles about LTD, including our most recent articles:
“LTD and COVID-19: Applying for Disability Benefits During COVID-19,” “LTD and COVID-19: Mental Health Claims Related to the Pandemic” and “Struggling to Be Seen and Believed: Making an LTD Claim for an “Invisible Condition” and our “Guide to LTD for Union Representatives”, as well as other information related to applying LTD.