By: Kimball Law
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How Long Term Disability (LTD) Coverage Works in Nova Scotia
Most of us have insurance coverage of one form or another. Many of us have different types of insurance provide for different coverages whether it’s for home, auto or work. The reality is that insurance is a very useful product, which is why there are a lot of insurance companies out there and they’re doing very well because they have many customers that require their services.
We have insurance to protect us in the event of a loss of some kind or other. In the world of disability insurance, the loss we’re concerned about is our inability to work and earn an income to support ourselves and our families. This can be a very confusing area for lots of people. Sometimes we have disability insurance through our employment, sometimes it’s private coverages that we have and there are different elements to insurance coverage. This is because you can have a private policy through one of the major insurance companies, but you can also have specific coverages. For example, many people have Canada Pension coverages through their employment. If you’re involved in a motor vehicle accident, you may have coverage through Section B of your auto policy.
Some people will have specific disability coverages to insure a mortgage or a loan that they have with the bank. So the various types of coverages and the various interplay of these coverages, one with the other, because sometimes if you get one coverage, another coverage is deducted. Again, because of the overriding rules that govern insurance payments and coverages, usually mandated by provincial statutes. In a broad sense, it should be understood that disability insurance can arise in a variety of circumstances.
What Injuries and Situations does Disability Insurance Cover?
In Nova Scotia, we often see it associated with car and motor vehicle accidents or sometimes what is commonly known as slip and fall accidents, where people have an injury as a result of falling. However, disability insurance also applies for illnesses as well. You could be working or have a long working career and develop an illness of some kind. This could be a serious illness such as heart disease or cancer, it could be a mental illness such as PTSD or anxieties that render you unable to continue with your employment.
How Long Does LTD Coverage Apply?
Most policies of insurance, long term disability or LTD policies, have a variable definition. In Nova Scotia, there’s a disability coverage usually for the first 2 years that is often termed own occupation. That is that the individual is unable to perform the essential duties of their own occupation. As indicated, that’s usually for a two year period in most policies.
Following that two year period, the definition then changes to an any occupation rule. The test for eligibility for insurance in those circumstances is whether you can perform the essential duties of any occupation, for which you’re suited for by reason of training, education or experience.
So, for the first 2 years (for most LTD policies), the issue is: Can you perform the occupation you were engaged in at the time you went off on disability? After 2 years, the insurance company will no longer be responsible for covering that LTD coverage even though you can’t do your own occupation, it’s deemed that you can perform some other occupation.