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Long Term Disability CPP FAQ's

What is Canada Pension Plan (CPP) Disability and how do I qualify for benefits?

CPP is a monthly pension that is paid to people who have contributed to the plan and who are disabled according to CPP legislation. In addition, CPP also pays monthly benefits on behalf of the disabled contributor's dependent children.

I recently applied for LTD benefits. Do I have to apply for CPP disability benefits?

No, it is not generally necessary to immediately apply for CPP disability benefits when you submit a claim for LTD. The decision should be based upon the severity of your illness or injury. Nonetheless, the terms of the LTD contract require you to apply for CPP disability benefits if the Claims Administrator requests that you submit a CPP application.

How often can the Claims Administrator require that I re-apply for CPP?

When there is evidence suggesting a member may be entitled to CPP disability benefits, the Claims Administrator will require that an application be filed. If the CPP application is denied, the Claims Administrator may require that an appeal be filed. The Claims Administrator will also assist the member with their CPP appeal by sending medical information to CPP from the LTD claim file.

I have received several requests from the Claims Administrator to apply for CPP disability benefits. The advantage of receiving CPP, according to the Claims Administrator, is the cost of living (COLA) provision from CPP will not reduce my LTD benefit. The winner in this situation appears to be the LTD Plan. Why should I apply for CPP?

Although the income from a CPP disability reduces your LTD benefit there are advantages to receiving a CPP disability pension:

1. It places a freeze on your financial earnings as of the date of disability. This prevents CPP from establishing a record of zero or nil earnings to average into your future retirement or disability income calculation for the period you are disabled from working and not contributing to the CPP fund. Without this earning freeze, your future entitlement to CPP benefits, including retirement benefits, could be adversely affected.

2. If you are in receipt of CPP disability benefits at the time of your death, CPP survivor benefits will be paid at the full level as though you had been working until the date of your death.

3. The LTD Plan only offsets the primary CPP disability amount from the LTD benefit. The CPP disability benefit payable on behalf of any dependent children (secondary) is not offset from your LTD benefit.

I have been approved for Canada Pension Plan (CPP) disability benefits. I signed a form authorizing CPP to reimburse my insurer directly. CPP sent a lump sum cheque to my insurance company. Why did the Claims Administrator still send me a letter to recover overpaid benefits?

CPP does not always reimburse the entire retroactive amount owed to the LTD insurer. Do not hesitate to contact our Claims Administrator if you have questions about CPP disability benefits and your LTD claim.

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