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Short Term Disability vs. Long Term Disability Insurance

By: Benefits by Design | Tuesday March 16, 2021

Updated : Thursday October 27, 2022

When we’re talking about “Disability Insurance,” often, Short Term Disability (STD) and Long Term Disability (LTD) are lumped together as one. However, that isn’t the case and the products can be quite different.

Download: Disability Insurance in Action Infographic (PDF: 685 KB)

With instances of disability on the rise in Canada, now it is time to take a closer look at how these two disability products work and how they protect working Canadians.

What is Short Term Disability (STD) Insurance?

Short Term Disability (STD) Insurance provides income for a covered plan member when they are unable to work for a short period of time due to hospitalization, an accident, or becoming ill.

What’s Different About STD?

The key distinction here is that STD is for a shorter period of time than Long Term Disability (LTD), and can typically last between 17 – 26 weeks, depending on plan design.

There’s much more to talk about when it comes to STD, including:

You can learn more about these questions (and the answers) below.

What is Short Term Disability (STD) Insurance and Why is it Important?

What is Long Term Disability (LTD) Insurance?

Long Term Disability (LTD) Insurance provides financial assistance when a covered plan member is unable to work due to an accident, illness or injury that prevents them from completing the duties of their own occupation. Depending on the nature of the disability, the benefit can provide income replacement up to age 65.

What’s Different About LTD?

LTD can provide income replacement for a much longer period of time. Depending on the nature of the disability, this coverage can last up to age 65, whereas STD lasts for a maximum of up to 26 weeks.

There’s much more to talk about when it comes to LTD, including:

You can learn more about these and more below.

What is Long Term Disability (LTD) Insurance and How Does it Work?

Common Disability Claims: Is it STD or LTD?

Generally speaking, the eligibility of claims between the two products will be similar, but the length of time income replacement will be provided is the distinguishing factor.

Do I Need both Short and Long Term Disability Insurance?

For example, if someone were to get in a car accident and be unable to return to work as a construction worker for a year, they would first go on STD (or employment insurance, if not covered by STD). Then, once the STD or EI period is up, could apply for LTD coverage.

See how these two coverages work together from our Disability in Action infographic!

Download the Infographic (PDF: 685 KB)