Have you been contributing to the National Canada Pension Plan regularly? If you have, you may qualify for benefits if you suffer a severe or debilitating injury that is considered a disability in Canada. One of the questions we get asked often is whether one can qualify for CPP contributions while on long-term disability.
In most cases, if you’ve been making CPP contributions while on long-term disability, you’re your insurer can legally deduct the benefits you are receiving from CCP from your monthly long-term disability payments. Most insurers offering long-term disability CPP will specify to their clients that they can also apply for benefits through the Canada Pension Plan. This allows them to reduce the benefits they eventually payout to you by deducting the CPP benefits paid.
Do I qualify for CPP Benefits?
CPP disability and LTD benefits are both available to Canadians who have been injured and are unable to work. However, there are solid criteria to qualify for CPP benefits. For instance, you must be below 65 years to be awarded CPP benefits. You must also prove that you suffer from a prolonged and severe disability simultaneously. To be awarded CPP benefits, you must have contributed to the CPP system for 4 of the last 6 years or 3 of the last 6 years if you’ve contributed for more than 25 years.
How are injuries classified as severe under CPP?
For an injury to be recognized as severe under the CPP, it must be deemed a physical or mental disability that prevents you from doing any type of sustainably gainful work regularly. The disability must also be deemed long-term or likely to lead to death.
Can your application for CPP benefits be rejected?
Almost 56% of first-time CPP applications are rejected. Part of the reason why a high number of applications are not approved on their first try is because of a lack of due diligence and proper documentation. The supporting documentation you provide can help strengthen your application and increase your chances of approval. The challenge is often to prove that you are indeed suffering from a condition that can be deemed a disability. Working with a personal injury lawyer helps to ensure that your claim is handled strategically and that the documentation needed to prove the severity of your condition is provided in full.
Does CPP disability affect CPP pension?
You cannot receive CPP disability benefits if you are already receiving a CPP retirement pension. CPP retirement disability benefits are awarded to persons from 60 to 65 and those already receiving CPP retirement pension or who have become disabled after receiving a pension. If you have been receiving CPP disability benefits, they will automatically change to CPP retirement pension when you reach 65.
What if you have a temporary or short-term medical condition?
If you suffer from a medical condition that is expected to be temporary or short-term, you will not qualify for CPP short-term disability. CPP is only available for long-term medical conditions that are considered grave (a rapidly progressive medical condition) or terminal (cannot be expected to be adequately treated or completely cured within 6 months and is reasonably expected to lead to death). You may consider applying for other disability benefits, such as the Employment Insurance Program.
Deductions from CPP benefits
Most long-term disability policies have an inclusion that allows the insurer to deduct CPP benefits from the gross amount paid to injured workers. It’s really important to review your policy and understand how the benefits will be treated in the event of a disability. The reality is that the amount you receive in both LTD and CPP payments may not be enough to cover your lost earnings, which is what leaves many injured workers feeling cheated. In the event that the CPP benefits are stopped for any reason, your LTD benefit should increase back to its original amount.
Get legal advice regarding your LTD & CPP benefits
In most cases, insurance companies try to get their injured clients to apply for CPP benefits before they access any legal advice on the entire process. While your insurer cannot force you to apply for CPP benefits, it’s a good idea to pursue CPPD because your LTD benefits may be reduced by your insurer, who will simply estimate the amount you would have received had you applied for CPPD. There are even cases where the insurer may look at the failure to apply for CPPD is a breach of the terms of their policy and use this as a valid reason to terminate your long-term disability benefits. As one of the top-rated disability law firms in Canada, we help clients access the disability benefits they are entitled to or pursue an appeal if their claim is denied.