Denied Disability Benefits in Ontario? What to do Next

This guide is written for employees in Ontario facing a short-term or long-term disability (LTD) denial. It’s general information, not legal advice.

The landscape at a glance

• Short-Term Disability (STD): Often an employer plan. If you don’t have STD or it ends, you may be able to claim Employment Insurance (EI) sickness benefits for up to 26 weeks while you’re off work.

• Long-Term Disability (LTD): Usually a group insurance policy. Most policies require you to be off work for a “waiting period” (often 90–180 days) before LTD kicks in.

• Two definitions of disability: For roughly the first 24 months, most policies ask if you can do the essential duties of your own occupation. After that, the test usually shifts to whether you can do any occupation suited by your education, training, or experience. This “change of definition” is a common cut-off point.

• Separate from human rights law: Your employer has a duty to accommodate disability to the point of undue hardship, regardless of what the insurer decides about LTD.

Why insurers deny LTD claims

Common reasons we see:

1. Insufficient medical evidence (e.g., charts are light on function-based restrictions).

2. Pre-existing condition exclusions (often tied to treatment/medication look-back periods).

3. You don’t meet the policy’s definition of disability (especially at the 24-month change).

4. Alleged non-compliance with reasonable treatment or rehab programs.

5. Surveillance or insurer medical assessments that conflict with your doctor’s opinion.

Step-by-step: What happens after a denial

1) Read the denial letter carefully

Note the reasons and any deadlines (for internal appeal or further proof). Keep the envelope/email headers too.

2) Decide - internal appeal or lawsuit (or both)?

• Internal appeals go back to the insurer with more medical support. They can be useful to fix fixable gaps.

• But in Ontario, the 2-year limitation period to sue usually runs from when it first became appropriate to start a proceeding (often around the denial), and internal appeals may not pause the clock. Don’t let appeals eat up your limitation.

3) Shore up your medical evidence

Ask your treating providers for function-focused reports: what you can’t do, for how long, and why—not just a diagnosis. If you have variable symptoms, a brief symptom and activity diary helps illustrate fluctuations.

4) Consider CPP Disability (CPP-D)

Many LTD policies require you to apply for CPP-D if you might qualify. If approved, CPP-D usually offsets your LTD payment (you still benefit, but amounts get coordinated).

5) Keep employment issues separate but coordinated

• Tell your employer you’re disabled from work and engage in the accommodation process (modified duties, hours, etc.). That legal duty exists even if the insurer denies your LTD.

• If you’re unionized, LTD disputes often fall under labour arbitration rather than a civil lawsuit, depending on your collective agreement. Get advice promptly.

Internal appeal vs. lawsuit - how to choose

Internal appeal might help if:

• The denial points to a fixable evidentiary gap (e.g., missing specialist report), and you can obtain it quickly.

Starting a lawsuit (or preparing to) might be wiser if:

• The insurer’s position is entrenched (e.g., “you don’t meet the definition”) or you’re approaching limitation risk. Ontario courts have emphasized that a “clear and unequivocal denial” isn’t always required to start the limitation clock—another reason not to rely on appeals alone.

Practical tip: You can sometimes file a claim to protect your limitation while still sharing new medicals and discussing resolution.

The 24-month “change of definition”

Expect a re-assessment near month 24. The question switches from “Can you do your own job?” to “Can you do any suitable job?” Many cut-offs happen here; prepare updated, function-based medical opinions tied to real-world work demands.

Timelines & traps to watch

• EI sickness: up to 26 weeks; can bridge the waiting period to LTD if you lack STD.

• Policy proof-of-claim deadlines: Missed one? Courts can sometimes grant relief from forfeiture—so don’t give up purely because you’re late. (Limitation periods are different and stricter.)

• Ontario limitation period: Typically 2 years from when it was appropriate to sue; do not assume insurer appeals extend it. Get legal advice early.

What to do in the first 7–14 days after a denial

1. Calendar the limitation (conservatively: two years from denial or earlier if the circumstances indicate it was already appropriate to sue).

2. Request your claim file from the insurer (adjuster notes, internal medical reviews, surveillance).

3. Ask your doctor(s) for a targeted functional report addressing the insurer’s reasons.

4. Continue treatment and follow reasonable medical advice.

5. Document your symptoms and failed return-to-work attempts (dates, durations, outcomes).

6. Get legal advice—especially if you’re close to 24 months or limitation crunch.

FAQs

Can I receive EI sickness and STD at the same time?
No. You can’t be paid both for the same period; if you do, EI often needs to be repaid.

Will CPP-D reduce my LTD?
Usually yes—most policies offset CPP-D (you still keep the net advantage and the federal approval can strengthen your LTD case).

What if my policy mentions a one-year deadline?
Ontario has a basic two-year limitation, and courts scrutinize shorter contractual limits closely; results turn on wording and context. Don’t assume—get advice immediately.

How our firm helps

We:

• Review your policy and claim file for gaps.

• Coordinate function-based medical evidence.

• Navigate appeals vs. litigation to protect your limitation rights.

• Negotiate reinstatement or lump-sum settlements and advise on tax/offset implications.

If you’ve received a denial letter, reach out for a consultation. Early strategy often makes the difference.