As much as we like to think we are invincible, many individuals do become disabled. In 2012, almost 14% of the Canadian population over the age of 15 – a whopping 3.8 million people – reported living with a disability.
A disability can result from a number of causes including an injury, serious illness or a mental health related issue. However, many group insurance plans provide coverage for short term and long term disabilities. Since both Short Term Disability and Long Term Disability (LTD) insurance are a source of income replacement, it’s important that employees are setup correctly to receive the benefit.
Perhaps the biggest issue we’ve witnessed at Benefit by Design (BBD) Inc. around LTD claims is the employer failing to notify or encourage the employee to apply for coverage beyond the Non-Evidence Maximum. But this isn’t the only issue. Here are three administrative issues around LTD claims:
Three BIG Administration Issues that Affect Long Term Disability Insurance
Issue #1 – Enrollment (or lack thereof): With everything that needs to happen when a new employee starts, sometimes it’s easy to overlook the importance of insurance forms. Including the fact that they need to be completed correctly. Or that they need to be completed promptly when an employee’s benefit coverage starts. Failure to complete the insurance forms in a timely manner, could result in delayed coverage for the employee.
Issue #2 – Forgetting to update salary information: Long Term Disability (LTD) coverage is related to an employee’s salary. If an employee receives a raise during their time at your organization, that information needs to be updated promptly as this is how insurers know what coverage amount to provide the employee.
Issue #3 – Changing insurers: If your organization changes insurance carriers, you’ll need to ensure that the coverage takes into account employees that are grandfathered by this change in coverage. Failure to do so, could result in an grandfathered employees claim being denied.
These are just three issues that can happen with long term disability insurance, but there are more. Hear from a professional in the field of Disability Law, by registering for our webinar with Share Lawyers on September 26, 2018.