What Are Long Term Disability Benefits in Canada and How Do They Work?

TORONTO - Rezul -- Long term disability (LTD) benefits are meant to be a financial lifeline when illness or injury keeps you from working for an extended period of time. In Canada, they typically replace a significant portion of your income so you can focus on your health instead of how you will pay your bills.

What are long term disability benefits?

Long term disability insurance provides monthly payments when a medical condition makes it impossible to perform the essential duties of your job for a prolonged period. These benefits usually begin after other income supports—like short term disability or Employment Insurance (EI) sickness benefits—have run out.

Most Canadian LTD policies are offered through an employer's group benefits plan or purchased privately from an insurer. Some people may also receive support from government programs such as Canada Pension Plan Disability (CPP-D) or provincial disability benefits on top of private coverage.

How much do LTD benefits pay?

Across many Canadian policies, LTD benefits generally replace about 60–70% of your regular pre‑disability earnings. For example, if you earned 4,000 per month before you stopped working, your LTD benefit might be in the 2,400–2,800 per month range, depending on your specific plan.

This income replacement is designed to keep you financially afloat while recognizing that you may also be receiving other supports, such as CPP‑D or workers' compensation. Many LTD policies are structured to "top up" these other benefits, which means your LTD payment may be reduced by the amount you receive from government programs.

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When do LTD benefits start and how long can they last?

LTD benefits (https://sharelawyers.com/employee-long-term-disability-benefits/) never start right away—there is always a waiting or "elimination" period built into the policy.

• For many Canadians, this elimination period is at least 90–180 days from the date you stop working.
• During that time, people often rely on sick days, EI sickness, or short term disability benefits.

Once your LTD claim is approved, benefits can continue for several years and often up to age 65, depending on the wording of your policy. To keep receiving payments, you usually must provide ongoing medical evidence that you remain unable to work.

How do insurers decide if you are "disabled"?

The definition of disability in an LTD policy is crucial, and it often changes over time. In the first two years of a claim, many policies use an "own occupation" test, which asks whether you can perform the essential duties of the job you were doing when you became disabled.

After about two years, many policies shift to an "any occupation" definition. At that point, the insurer may only continue paying benefits if you cannot work in any occupation reasonably suited to your education, training, and experience—not just your old job.

Because of this change of definition, some people find their benefits reduced or terminated even though their health has not substantially improved. In those situations, getting legal advice can be important to understand whether the insurer's decision is fair under the policy.

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What medical conditions can qualify?

There is no single list of "approved" conditions for LTD, and in Canada the focus is on how severe your symptoms are and how they affect your ability to work. Almost any physical or mental health condition can potentially qualify if it prevents you from performing the essential duties of your job on a sustained basis.

Common examples include:

• Musculoskeletal problems such as chronic back pain or arthritis
• Mental health conditions such as depression, anxiety, PTSD, or bipolar disorder
• Serious chronic illnesses such as heart disease, COPD, diabetes, cancer, or long COVID
• Neurological conditions like multiple sclerosis, epilepsy, or Parkinson's disease.

In every case, you must have medical documentation from a qualified health professional that explains your diagnosis, treatment, and work‑related limitations.

What if your LTD claim is denied?

Even strong LTD claims are sometimes denied, often with reasons such as "insufficient medical evidence," "does not meet the definition of disability," or alleged pre‑existing conditions. A denial letter is not the end of the road; you generally have options to challenge the decision through appeal, negotiation, or legal action, but strict time limits may apply under your policy and provincial limitation laws.

Because LTD policies can be complex and deadlines are short, many Canadians choose to speak with a disability lawyer if their claim is denied or their benefits are cut off. An experienced lawyer can review your policy, assess whether the insurer has applied the rules correctly, and help you pursue the benefits you are entitled to receive.

You don't have to figure out long term disability benefits on your own. Reach out to a disability law firm like Share Lawyers (https://sharelawyers.com/) for a free consultation so you can focus on your health while they focus on securing the benefits you deserve.

for a free consultation so you can focus on your health while they focus on securing the benefits you deserve.