Long Term Disability Insurance (LTD) provides a more permanent income replacement as your medical condition prevents you from working over a longer time period. It offers a form of income protection in the event that an illness or disability leaves you unable to return to work. Disability benefits are different from workplace compensation benefits, as disability benefits arise from an illness or injury, which is not required to occur on the job. Whereas workplace compensation benefits are given as a result of being in the course of your employment.
There are benefits to having LTD Insurance. Many of Teachers Life Members have LTD coverage through the OSSTF Provincial LTD Plan.
1. Income Replacement: LTD provides you with a portion of your income that can go towards living expenses, which may also include medical treatment and rehabilitation. LTD insurance is part of your group benefits plan. If you become unable to work for a prolonged period of time due to an illness or injury (while you are insured), LTD benefits provide you with monthly income replacement.
2. Regular Payout: LTD benefits are calculated based on your income and are paid out on a regular and ongoing basis. LTD benefits do require that your condition is monitored and assessed regularly to determine when you are fit to return to employment and when your benefits will no longer be paid out.
3. Cost-of-living-adjustment (COLA): Some LTD policies allow you to buy a cost-of-living-adjustment (COLA) to add to your basic disability income coverage. Members who are insured under the OSSTF Provincial LTD Plan have COLA built into their coverage. This additional benefit raises the income you receive from your insurer by a certain percent each year. For example, if you become disabled and are unable to work, the COLA will gradually raise your benefits to help keep up with increasing prices of rent, food, utilities, medical and additional expenses.
In most LTD plans, the definition of disablement changes after two years. Most often you will be reassessed at this time. If the reassessment determines that the disability is permanent benefits will continue until the end of your coverage term.