Ultimate Guide to Short-term Disability Benefits [+Video]

I wrote the Ultimate Guide to Short-Term Disability Benefits for people who need to apply for short-term disability benefits after going on sick leave from work.

This guide is based on 15 years of experience helping people with disability claims. It covers all the main topics related to short-term disability. Also, it includes links to articles that go deeper on important sub-topics.

Because you are reading this article, I know you are doing your research. You’re on the right track. I can’t overstate the importance of taking time to educate yourself about the disability claim process.

Keep on learning and I wish you all the best with your journey.

— David Brannen, Disability Lawyer & Founder, Resolute Legal

What are short-term disability benefits?

Short-term disability benefits are payments for people who can’t work because of disability or illness. They replace your income while you can’t work. Your job or an insurance company pays them.

So, if you can’t work because of disability or illness, you might be able to apply. 

In this guide, I’m talking about benefits that come from your job’s disability plan or an insurance company.

I am not talking about EI sickness benefits, CPP disability, workers’ compensation, the disability tax credit, veterans’ disability, or provincial income support. These programs are all different. You can learn more about them on our Disability Benefits page.

Types of short-term disability benefits

There are two types of short-term disability benefits in Canada. To get benefits, you must be covered under one of these.

Group insurance plans

Some jobs provide group benefits for their employees. These usually include medical, dental, and drug coverage. Sometimes they have short-term disability benefits too. So, if you have group benefits through your job, you might have short-term disability benefits. 

Employer-funded plans

Some jobs fund their own short-term disability plans. Some are simple. For example, they will continue your salary with just a sick note. Others are more complex. They might take longer to come to a decision. Some bring in people to help you with rehabilitation.

Sometimes, work-funded plans look like group plans. It might seem like an insurance company is in charge of judging claims and paying, for example. But, behind the scenes, it’s the employer who pays.

Eligibility for short-term disability benefits

Surprisingly, most Canadians can’t get short-term disability benefits. To be eligible, you must be covered by a short-term disability plan.

Workers and union members are usually covered. If your job includes group benefits, then you might have short-term disability benefits. But, it’s always best to check your benefits booklet to know for sure.

If you’re self-employed, things are a bit different. You’ll need to buy an individual insurance policy. You can get one from a broker or through a professional association. Most individual plans only pay for long-term disability, but some do provide other benefits.

What medical conditions qualify for short-term disability?

People often ask what conditions qualify for short-term disability. Really, any condition can qualify. You just have to meet the definition of “total disability.” This definition is different in each policy, however.

Above all, short-term disability is based on how bad your symptoms are — not your condition. So, what matters is if the symptoms keep you from doing your job’s main duties.

But, your diagnosis is still important! This is because a diagnosis allows for a treatment plan. If your diagnosis is unknown, then doctors can’t treat you. Instead, you’ll have to do lots of tests to rule out possible conditions.

Insurance companies don’t like it when there’s no diagnosis or treatment plan. If they don’t see you working to figure it out, then they will deny your claim or stop payments.

There are some types of claims that get denied often. Stress leave, burnout, and pregnancy are a few, for example.

So, in these situations, you must have a concrete diagnosis. For example, stress leave and burnout aren’t very clear. But, you might be diagnosed with depression or anxiety. Pregnancy isn’t a disability but there might be a complication that stops you from working.

Medical conditions that may qualify for disability benefits:

• Back Problems
• Bipolar Mood Disorder
• Carpal Tunnel Syndrome
• Chronic Fatigue Syndrome
• Chronic Pain
• Complex Regional Pain Syndrome
• Crohn’s Disease
• Depression
• Fibromyalgia
• Heart Disease
• Headache and Migraine
• Irritable Bowel Syndrome (IBS)
• Knee Disorders
• Lupus
• Lyme Disease
• Multiple Sclerosis
• Neck and Cervical Disorders
• Psoriatic Arthritis
• Sleep Disorders
• Vestibular Disorders
• Visual Disorders

List of short-term disability insurance companies and claim administrators

Short-term disability benefits can come through a number of companies. They are either insurance or claim management companies. Following is a list of the most common companies involved with short-term disability benefits. You can click through for more information.

Short-term disability insurance companies

• ACA Insurance
• Assumption Life Financial Services
• Blue Cross Life Insurance Company
• BMO Life Assurance Company
• Canada Life Assurance Company (formerly Great West Life)
• Canadian Tire Life Insurance
• Cigna / Life Insurance Company of North America
• Co-operators Life Insurance Company
• Desjardins Financial Security Assurance Company
• Empire Life Insurance Company
• Fenchurch General Insurance Company
• IA Excellence Life Insurance Company
• Industrial Alliance Life Insurance
• Industrial Alliance Pacific Life
• La Capitale Life Insurance
• London Life Insurance Company
• Manulife / Manufacturers Life Insurance Company
• Medavie Blue Cross
• Primerica Life Insurance Company
• RBC Life Insurance Company
• Sun Life Assurance Company of Canada
• Standard Life Insurance Company
• SSQ Life Insurance Company
• ScotiaLife Financial
• UL Mutual Company
• Wawanesa Life Insurance Company

Claim administrators

Employers and insurance companies can have other companies act for them. These are also known as third-party administrators. They judge and pay claims on behalf of the plan providers.

Following is a list of short-term disability claim administrators:

• Adminplex Resource Services Inc
• AAS / Automated Administration Services Inc
• AGA Benefit Solutions
• BBD /  Benefits by Design
• Belmont Health & Wealth
• Benecaid
• Canada Life
• Cowan
• D.A Townley
• Dehoney Financial Group
• ECON Group Inc
• Edge Benefits
• Group Health Benefit Solutions
• Johnson
• Johnston Group
• Johnstone’s Benefits
• Mainion
• Manulife
• Medavie Blue Cross
• Medisys Health Inc
• Morneau Shepell
• Oncidium Health Inc.
• OTIP / Ontario Teachers Insurance Plan
• People Corporation
• RWAM Insurance Administrators Inc.
• Sedgwick
• Sunlife 
• Sutton Special Risk

Rules for short-term disability benefits

The rules for short-term disability claims are different for every situation. You can find them in three places.

Your disability plan or policy. Every policy or plan is unique. Therefore, you shouldn’t take advice from people who aren’t covered under the same plan as you. Instead, you should get a copy of your own policy. Usually, you can get your benefits booklet from your employer or union.

The insurance laws for your province. Short-term disability benefits are also controlled by each province. They have similar laws, but they aren’t the same. Don’t take advice from people who may be thinking of the laws from another province!

The common law of Canada. Finally, the last source of rules is the common law of Canada. The common law refers to decisions made in court cases. After they’re settled, they create guidelines for future cases.

How to apply for short-term disability benefits

Applying is the same for most short-term disability plans.

In some plans, you need to use all the paid time off you have through your job first. This includes paid sick leave and vacation days.

Then, you’ll need to get the right forms to apply. These are the three most common ones:

• the Notice of Claim
• the Employers Report
• the Attending Doctor’s Report

These forms are almost the same for all short-term disability plans. But, you have to use the right form — one from the company you’re dealing with. Otherwise, they can reject your claim.

You fill out the Notice of Claim form. Then, you ask your work and doctor to fill out the others. Usually, you will submit these to an outside company. You should also submit any other documents they need. It’s your job to make sure that they all get to the right place.

Finally, wait for a decision. Once all the forms are in, the insurer will start to judge your claim. It will either get denied or approved.

Appealing a denial of short-term disability benefits

A denial is when an insurance company refuses to pay a claim. You can get denied if you don’t qualify in the first place. However, sometimes claims are denied when they shouldn’t be. In this case, the decision can be changed.

There are usually two levels of appeal. Firstly, there are internal appeals. If you don’t get approved, then you might move onto a hearing or lawsuit next.

But first, let’s review some key things you should know about before you appeal.

The denial letter

The denial letter is an important document. It will include the information you need to make your appeal. By law, the insurance company must give you a denial in writing. So, they will either mail or email the denial letter to you.

Firstly, it tells you that you have the right to appeal. Then, it will often say why you got denied. These reasons are crucial because they can help you build your case. For example, a smart way to appeal is to list each reason. Then, challenge the reasons with new information. You can also share these with your doctor. They may write a new medical letter by talking about each reason.

Finally, the letter will give you a deadline. The deadline may be a date or a number of days. For example, you might have 60 days. Or, you might have to appeal by September 30, 2020.

Deadlines for appeal

Depending on your plan, your deadline can be soft or hard. A soft deadline doesn’t have legal consequences. For example, the insurance company may say that you have 30 days. If it’s a soft deadline, you can keep appealing — even if you miss it the first time.

On the other hand, there may be hard deadlines. If you miss a hard deadline, then you may lose your right to more appeals.

Internal Appeals

Internal appeals take place within the insurance company. So, a second employee will review the decision about your claim. This new employee has the power to approve it.

With insurance-based plans, there aren’t rules for internal appeals. In fact, the denial letter is the only document that explains the process. The deadlines are usually soft. In other words, you won’t lose the right to appeal if you miss it.

However, with nonprofit plans, things are more strict. You’re more likely to see firm rules and hard deadlines. If you miss a hard deadline, then you can lose your right to appeal.

Insurance companies allow two to three rounds of internal appeals. If you don’t get approved, then you can move on. The next level is either an appeal hearing or a lawsuit.

Whether you have a hearing or a lawsuit depends on your plan. Sometimes, if your job funds your plan, you will have to do a hearing. But, you might not have the option of a lawsuit. On the other hand, with insurance-based plans, often your only option is to make an appeal by lawsuit.

Appeal hearings

Appeal hearings, also known as arbitrations, usually happen with plans that are funded by your job. Specifically, they happen in jobs that involve unions.

If your disability plan has an appeal hearing, then this will likely be your last level of appeal. The decision at the appeal hearing is final. In other words, it is binding on you and your insurance company.

Appeal by lawsuit

If you don’t win your internal appeals, then you might go to a lawsuit. A lawsuit is the final level of appeal. This is where a judge or jury makes the final decision. Similar to a hearing, the decision is binding on you and the insurer.

In a lawsuit, you can sometimes claim other damages in addition to the disability benefits you’re owed. Other damages may include compensation for mental distress, legal costs, and financial losses. For example, if you’re forced to sell your house, you might ask for interest paid on loans or losses.  

During the lawsuit, the employer and insurance company will continue to look at your claim. They might even choose to approve you before a judge sees your case. If that happens, you can choose to stop the lawsuit. Alternatively, you can continue to ask for compensation, as mentioned above.

Lawsuits are complicated. Sometimes they need to be against the insurance company, or your employer, or both.

You can learn more in the posts below:

• Short-term disability claim denied: Top 7 questions answered
• My short-term disability claim was denied: What are my options?
• Short-term disability denial: Do I have to return to work? 

After approval of short-term disability benefits

You still have to deal with your insurer after you’re approved. To keep your benefits, you must carefully manage your relationship with the insurance company. You’ll need to do what they ask, even if you don’t want to.

Continuing medical review

The payment of benefits is conditional. You have to keep giving proof that you’re disabled. In other words, the insurance company watches you. You’ll need to send in updates and reports from your doctor on a regular basis. They’ll likely phone you for updates, too. This can last until the end of your benefits period. They do this more often if you’re young or if they think you will get better.

The insurance company has a legal right to perform this ongoing medical review. Therefore, you have to cooperate with them or they can stop your payments. 

Treatment and return to work programs

You might have to do treatment or return to work programs — physiotherapy, occupational therapy, and psychological therapy, for example. This is more common with long-term disability plans, but can happen in short-term, too. They can’t force you to go, but if you don’t, they can stop your payments.

So, if you have been getting benefits for a few months, be aware that you might be sent for treatment soon.

Independent medical examinations

Most disability plans allow the company to send you to a doctor that they choose. This is called an independent medical examination, or IME.

The doctor for an IME doesn’t treat you, however. An IME is a one-time visit. You go so that the doctor can give a medical-legal opinion to your insurer.

After the exam, the doctor will send a report to the insurance company. The report will give their opinion about your medical conditions, treatment, and ability to work. It will also answer any questions that the insurance company asks.

It’s common for people to not want to attend these exams. Some common reasons are that the doctor doesn’t specialize in their condition, for example. Another example is that the doctor has bad reviews online.

While these are valid concerns, you still need to attend. The insurance company has the right to choose the doctor, even if you disagree with their choice. If you refuse to go, then they have the right to stop your payments. 

Again, IMEs are less common with short-term disability than long-term — but they can happen. Go to the exam in good faith, even if the doctor has bad reviews. You may be happily surprised by the results. Sometimes the doctor will fully support you.

Surveillance

Many people are surprised to learn that insurance companies hire private investigators. This is more common in long-term disability claims, but it happens in short-term claims too. Also, they’re more likely to watch you if you’re young or if your payment is high, for example.

Video surveillance is legal, but only in public spaces. An investigator can record you on your property as long as they’re on the public sidewalk. Similarly, online surveillance is limited to things that are posted publicly.

In my experience, surveillance rarely shows that a person is a liar. However, you have to be careful when you describe your limitations. You don’t want a video of you walking if you said you couldn’t, for example. The insurer wants to make you seem less honest. So, catching you in a small lie is one way to do that.

Interaction with EI Sickness benefits

You can’t receive EI sickness benefits and short-term disability at the same time. In fact, if you do receive both, you will need to pay some back.

For example, imagine you got EI sickness payments for 2 weeks. Then, you get approved for short-term disability, and they will pay you for those same 2 weeks. This creates an overlap. If there’s an overlap, then you’ll need to pay back the EI program.

After you’re approved for short-term disability, you’ll receive a back payment. Then, you can refund EI using that money.

Employment rights on short-term disability

Employers have the right to fire a person who is on sick leave. Most employers won’t do this, however. There are practical and legal reasons. Firstly, you must get reasonable notice of termination to be fired legally. Otherwise, without notice, they have to pay you severance. This is the same for those on sick leave and those actively working.

As an employee on sick leave, you may be protected by human rights laws. Namely, laws that prevent discrimination for disability. However, protection under these laws isn’t guaranteed. Not all sick leaves qualify as a “disability” — especially if you’re expected to recover shortly.

Being protected under these laws can mean a few things. Your employment is protected — but maybe not your specific role. And, your employer has a duty to accommodate your disability. They might modify your job, allow you to work reduced hours, or move you to a different role. 

If you’re on sick leave that goes well beyond the short-term disability period, then your employer eventually has the right to stop your employment. Yes — even without notice of termination or severance pay. 

To learn more, check out our page on employment rights and disability benefits.

Going from short-term disability to long-term disability

Short-term disability benefits cover a short leave from work. The amount of time varies between plans, but it’s generally between 17-52 weeks. The maximum benefit period is the maximum number of weeks you can get payments.

You might reach the end of the benefit period and still not be able to work. In that case, you can look into long-term disability benefits. Many plans that include short-term disability benefits will also include long-term. 

Often, the same company that handles your short-term disability claim will also handle your long-term claim. If so, you can get forms to switch over from short-term to long-term. 

A different insurance company might handle long-term disability. In this case, you will need to do a new application. It will include forms similar to the ones you have done.

Answers to frequently asked questions about short-term disability benefits

Next Step

We recommend that you download this guide so you can refer to it later. However, If you have questions about your short-term disability claim, or any disability claim problem, please call our support team at 1-888-732-0470 for a free consultation.