Contributing Author - Brennan Doherty
Cases of long COVID are skyrocketing.
At least 150,000 Canadians are believed to suffer from its symptoms: fatigue, memory loss, and breathing difficulties. The condition can make it nearly impossible to work, enjoy time with your family, or even take care of yourself – all situations that disability insurance is supposed to cover.
Making a successful disability insurance claim is tricky at the best of times. And thanks to the relative newness of the condition, some insurance companies seem reluctant to pay out long term disability payments – leaving patients struggling with long COVID to figure it all out themselves.
Insurdinary dove into the details to figure out exactly how to handle disability insurance purchases for long COVID, or any other condition:
What Is Disability Insurance?
Disability insurance comes from a variety of places, including employer or union plans, individual insurance policies, and governments. Other insurance products, like auto insurance or mortgage protection, may also include disability insurance coverage.
Short-term disability insurance coverage covers you for up to six months while sick or injured to the point of not being able to work. These plans can be purchased privately, but according to the Financial Consumer Agency of Canada, anyone working for an employer with a short-term disability plan can’t go private – they have to use their work policy. (Canadians without short term disability coverage can be eligible for EI sickness benefits up to a maximum of $638 a week, if you’ve used all of their sick leave and worked a minimum of 12 weeks before the start of your claim).
Long-term disability insurance generally picks up when short-term disability benefits or EI end, according to the Financial Consumer Agency of Canada. They can replace anywhere from 60 to 85 percent of your normal income but, the agency says, each disability plan is different.
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What Kinds of Policies Are Available to Me?
Disability insurance is a complicated subsector of coverage. While most Canadians are covered through government plans (including EI) or workplace policies, the Canadian Health and Life Insurance Association estimates around one million Canadians buy their own individual disability insurance policies. Broadly speaking, the CHLIA says, there are three types of plans on offer:
Noncancellable policies cannot be cancelled by a disability insurance provider and the price can’t be increased during a set time in the contract.
Guaranteed renewable policies can raise premiums for everyone within a certain category or class of client, but cannot do for individuals (in other words, a company can’t single you out and raise your rates).
Commercial policies allow insurance companies to upcharge or even refuse to renew you once a policy’s term has expired.
Then there are group insurance plans. The CHLIA says around 4.6 million Canadians are covered by short-term protection, and over 10 million have long-term protection. Group plans typically include sick leave, short-term disability for between 15 to 52 weeks, and long-term disability.
According to the CHLIA, long-term disability benefits usually last for up to two years if you are unable to do your regular job – after that, you may need to prove you are physically incapable of performing any job.
What Counts as A Disability? Does Long COVID Count?
This is the 100 percent of lost income question for policyholders. Disability insurance companies often have different definitions. (The Financial Consumer Protection Agency recommends you triple-check with your plan administrator or insurance agent on what your policy means by ‘disability’ before signing on the dotted line).
An any occupation plan means you’ll only receive benefits if you’re unable to work at all. The Financial Consumer Protection Agency says an own occupation or regular plan means you’ll receive benefits if you’re unable to perform the main duties of the job you had when you became disabled. You can still receive benefits even if you end up working in a different job from the one you had before your disability – although some policies may cut back your benefits instead.
Learn more about Long Term Disability Insurance and how it can help.View Article
What Is The Process of Applying for Disability Insurance?
The CHLIA says group coverage through work is handled by your employer or union. Typically, there aren’t medical questionnaires – as is the case with life insurance – in large companies. (This is because unlike, say, a startup, a large company policy spreads the risk of an insurance company paying out over many, many employees).
Individuals have a somewhat more intensive process – much more akin to an individual life insurance application. An insurance agent will ask you about your health, occupation, earnings, and hobbies. All of these factor into how risky the insurance company believes you are.
The details on whether or not long COVID patients can access adequate disability insurance coverage aren’t fully clear yet. Long COVID seems to last only a few weeks in some patients, but drag on for months – and perhaps years – in others. Some patients are unable to work for a lengthy period and eventually recover, while other COVID survivors report healthy periods interspersed with long COVID spells.
However, CHLIA says, poor health might not be a barrier to buying a good disability insurance plan. “Even if you have medical problems, don’t assume you cannot be insured,” reads a CHLIA guide. “Consult your insurance agent, especially if you’ve been healthy for several years.”
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How Do I Handle a Claim?
Every insurance company has a series of forms for completing a claim. The CHLIA says you need to fill everything out correctly – and promptly – in order to receive a payout. “There may be implications if you don’t submit your claim within a certain amount of time after you become disabled,” its disability insurance guide read.
About the Author
Brennan Doherty is a Toronto-based writer. He was once a staff reporter for the Toronto Star's 24-hour news desk, a staff reporter for Star Calgary, and worked for CTV News Channel. He is a proud Ryerson University graduate and gets far too nerdy about unpacking complicated ideas.
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