The lawyers at Aaron Waxman & Associates are experienced with Disability, Personal Injury and Employment claims.
A recent article on moneyville.ca posed the question, “Are your disability benefits at risk?”
What is meant by this, is what type of disability benefits are your employers providing you with? If you have long-term disability benefits available to you through your employer, is there an insurance company underwriting these benefits?
Some companies/employers have moved to a “self-insured” arrangement, where they set aside money to pay for their employees’ disability benefits…Unfortunately, you may not be aware of this until your employer gets into financial trouble, meaning your LTD payments are at risk.
An example is what happened with Nortel employees, a company who decided to go this route. About 400 employees were in receipt of LTD benefits. Nortel filed for bankruptcy protection in 2009 and employees found themselves cut off from disability benefits. The disabled employees received a lump sum benefit that will cover them for a couple of years only.
Employees of Nortel were under the impression that they were insured by Sun Life as their disability insurer. Sun Life handled the administration and communication for Nortel’s long-term disability benefits but did not cover the payments.
Independent financial analyst Diane Urquhart provides her advice in the article and it is noteworthy that approximately 1.1 million people (7% of the workforce) are in employer-sponsored long-term disability plans that are not underwritten by insurance companies.
If your LTD plan is underwritten by an insurance company, you should take comfort in knowing that insurance companies are regulated for solvency by the Office of the Superintendent of Financial Institutions. They must set aside reserves to pay for current and future claims.
At the law firm of Aaron Waxman & Associates, we specialize in long-term disability claims and can help you in your time of need.
* This blog is for informational purposes only and is not meant to substitute legal advice. Please read our disclaimer for further information.
* All of our lawyers are licensed by The Law Society of Upper Canada
* Office in Toronto and able to represent people in the province of Ontario