What You Need to Know About LTD and CPPD Benefits
I have spent many years representing people across Ontario whose short-term disability (STD) and long-term disability (LTD) claims have been denied or terminated.
Clients often ask me about Canada Pension Plan Disability (CPPD) because they have heard that these benefits may be available to offer additional financial support while they recover from a disability that is keeping them from working. Others ask me about these benefits because their LTD insurer has advised them that they are required to apply for these benefits.
Clients often have many questions about CPPD benefits, including:
- What are CPPD benefits and how do I apply?
- Should I apply for CPPD benefits if I am already receiving LTD benefits?
- When should I apply for CPPD benefits?
- What if my application is denied?
I’ll answer some of these questions below.
What are CPP Disability benefits?
Most working Canadians are likely familiar with the Canada Pension Plan (CPP) Retirement Pension, which pays benefits for life, typically starting at 65 years of age. Fewer people know about a second type of CPP benefits, CPP Disability (CPPD) benefits, which are available to people under age 65 who are forced to stop working due to disability.
CPPD benefits vary depending on the amount of CPP contributions you have made over your career to date. People who have been working for years prior to their disability are often entitled to the maximum amount, which is currently over $1,400 per month.
What is the test for CPP Disability benefits?
In order to be entitled to CPPD benefits, you must have made regular CPP contributions in 4 of the last 6 years (or 3 of the last 6 years if you has been contributing for at least 25 years) and you must now be suffering from a disability that is both “severe” and “prolonged.”
For your disability to be “severe,” it must prevent you from engaging in any regular, gainful employment. For your disability to be “prolonged,” it must be unclear when or if it will improve to the extent that you will be able to return to work.
How do I apply for CPP Disability benefits?
There is now an easy online form to apply for CPPD. That same webpage also provides a form for your doctor to complete.
It is important for you and your doctor to be as complete as possible in describing your symptoms, limitations, diagnoses and treatment so that those reviewing your file have all of the information they require to understand your disability.
You will also be asked to upload medical records through the online portal in support of your application. You can upload them either at the time you submit the application or at a later date, but your application won’t be considered until the records have been submitted.
What if I’m also getting LTD benefits?
CPPD is almost always deductible from long-term disability (LTD) benefits to the benefit of the insurance company. This means that if you are currently receiving LTD benefits, you will receive virtually no financial advantage from being approved for CPPD benefits as well. The benefits will just go to reduce the LTD benefits your insurer has to pay.
Despite this, there are actually several reasons why it is very important for you to apply for CPPD even if you are receiving LTD benefits. Virtually all LTD policies require you to apply for CPPD. If you fail to apply for CPPD, the insurer may have the right to deduct the CPPD benefits that you would have received if you had applied for and been awarded CPPD benefits.
Another reason to apply for CPPD even if you are receiving LTD benefits is that these benefits are seldom terminated so long as you remain disabled. This can offer you protection in case your LTD benefits are terminated in the future. Unfortunately, insurance companies often cancel LTD benefits without warning and against the advice of your doctor. Getting CPPD in place while you are still receiving LTD benefits means that you will still have a stream of income even if your LTD insurer terminates your benefits. This can help hold you over while your lawyer works to hold your insurance company accountable for the benefits you’re entitled to receive.
When should I apply for CPP Disability benefits?
Except in cases where your prospects of ever returning to work are extremely low, it may be appropriate to wait for several months and even as much as a year or so before applying for CPPD, since it can be difficult to establish a “prolonged” disability on the basis of only a few months of treatment records. CPPD may be awarded retroactively to the start of the disability in a lump sum for up to 15 months prior to the application date, so you are not required to apply for CPPD right at the start of your disability.
What if my claim for CPP Disability benefits is denied?
If your CPPD application is denied, you have an opportunity to appeal the decision by supplying additional medical information in support of your claim. In my law practice I have frequently seen CPPD benefits awarded after an appeal. I often handle these appeals for my clients’ free-of-charge because I want to ensure that they have the financial support they need while we are engaged in litigation with their LTD insurer.
In my experience, CPPD appeals are much more frequently successful than appeals of LTD benefits denials, which is why I usually appeal CPPD denials for my clients. By contrast, in many LTD denial cases I advise clients to consider proceeding directly to a lawsuit against their LTD insurer, rather than accepting the delay associated with an LTD appeal that is much less likely to be successful.
While my experience helping clients have given me significant insight into the bureaucratic inner workings of both private and public insurance, I believe in a simple rule: everyone deserves to receive the support they need to cope with their disability and focus on feeling better again.