It can be very stressful to navigate disability insurance, either long term disability or short term disability
A Denied Claim
Why Your Long-Term Disability Claim May Have Been Denied
There may be several reasons why your claim for long-term disability insurance may have been denied. These include, but are not limited to, the following:
a) You are not “totally disabled”. But, be careful! Do not be too quick to accept this explanation, as it is often used in an intentionally misleading way. A disabled employee does not need to be in a coma or to otherwise be completely incapacitated to qualify for long-term disability. As long as you are unable to do substantial aspects of your occupation, or any occupation for which you are suited either by training, education, or experience, then you may be “totally disabled” as required. See: Nantsios v. The Canada Life Assurance Company,  O.J. No. 4381.
b) You can do similar work. An insurer might argue the employee is now able to transfer into another occupation. Where this goes against the advice of your doctor, you should be suspicious. You should seek legal advice if your insurer expects you to work contrary to the advice of your doctor.
c) You have not provided enough medical documentation. Many insurance companies will take the position that the medical documents you have provided do not actually support your disability claim. This is a common tactic insurance companies will use to deny your disability claim. They also commonly do not explain exactly why your documentation is not good enough. Generally, as long as your doctor supports your disability, you should qualify for long-term disability. If an insurance company uses this tactic to deny your claim, you should seek legal advice.
d) The insurance company’s doctor does not think you are disabled. Be very cautious in this situation. Often, the medical consultants used by insurance companies are “hired guns”, meaning they will side with the insurance company regardless of whether your claim has merit. Sometimes, they are not even doctors! You should always have an independent doctor review your disability.
e) The insurance company has had you under surveillance. The idea of the insurance company watching your every move is undoubtedly a scary thought. It is intended to be.
This is frequently used as a scare tactic or as a form of intimidation and bullying to convince you not to pursue your claim, even where you may have a legitimate one. If an insurance company is denying your claim because of their own surveillance, you should seek legal advice.
Appealing the Decision
If your insurance claims are denied, it is best to consult a legal professional with experience and knowledge to explore all of your options, as insurance companies can flood you with many complicated documents. A denied claim may force an employee to make the difficult decision of returning to work, even if they do not feel physically or mentally able to do so. Although this may not be an ideal situation, the employee can seek accommodation upon returning to work. Employers are required to accommodate employees who have a disability, whether physical or psychological. This duty is derived from either the Ontario Human Rights Code or the Canadian Human Rights Act. Common accommodations include minor changes to the physical work environment, changing the job requirement or changing the shift schedule. Employers have a duty to accommodate up to the point of undue hardship, which is actually a very high threshold where the employer suffers economic damage.
If your claim is denied, the insurance company will often include information about appealing the decision. Note that this is usually an internal review, so the insurance company’s decision will often stay the same. It is important to be aware of the potential delay that appealing the decision can have on your case. There are very strict time limits on when you can commence a lawsuit against the insurance company, and appealing the decision could push you very close to those time frames.
A Denied Claim
A Denied Claim
Time for Appealing Denial: Limitation Period
In Ontario, an employee who has their long-term disability claim denied has only two years to sue, after which they will no longer be able to. This is set out in the Limitations Act, 2002. The difficult part is determining when the clock starts to run. In the decision Western Life Assurance Company v. Penttila, the Court determined that the limitation period begins to run once an employee receives a final decision from the insurance company, after all appeals are finished. The long term disability claim must first have been clearly and unequivocally denied. This suggests that legal proceedings may be premature if they are started prior to the end of the insurance company’s internal appeal process.
In Clarke v. Sun Life Assurance Company of Canada, the Ontario Court of Appeal confirmed that an insured has a cause of action for breach of contract against her insurer when the insurer stops paying long-term disability benefits.
If your disability insurance claim has been denied, please contact Ball Professional Corporation as soon as possible to understand your options, whether that is moving to have your benefits reinstated as quickly as possible, seeking accommodation in the workplace or commencing a civil lawsuit.
Please note that the above information does not constitute legal advice. It is general information about the law. If you require legal advice with an employment issue, please contact the experts at Ball Professional Corporation.
Canadian Employment Law
Mr. Ball is author of the authoritative and definitive text Canadian Employment Law - published by Canada Law Book (a division of Thomson Reuters). The text is used and cited by lawyers, law schools and judges across Canada.
To order Mr. Ball's Canadian Employment Law please visit the Carswell Store by clicking here or on the button below.