Long Term Disability and Your Pension Plan in Canada
Long term disability (LTD) benefits are crucial in times of need. However, receiving these benefits might impact your pension. To safeguard your financial stability and offer peace of mind, Share Lawyers clarifies the relationship between long term disability and pension plans.
Share Lawyers can provide insight about the relationship between long term disability and pensions in Canada.
Receiving Long Term Disability Benefits Can Affect Pensions
The first step is to review the specifics of your insurance policy and pension plan. As you learn more, you’ll begin to understand the extent to which LTD benefits impact pensions and vice versa. Here are a few things to watch out for as you learn more.
How Receiving LTD Benefits Could Affect Your Pension | |
Continued Pension Contributions | If your LTD plan is approved by your pension plan, it’s like you’re still working when it comes to your pension. Your pension contributions continue based on what you earned before your disability, so your pension keeps growing even while on disability leave. |
Frozen Pension Growth | If your LTD plan isn’t approved by your pension plan, your pension might stop growing while you are fighting for your disability benefits. This means your pension could stay the same as when you first went on disability, which might result in a smaller pension when you retire. |
Impact of Lump-Sum Settlements | If you choose to receive a one-time lump-sum payment instead of regular LTD payments, your pension contributions usually stop. Without these, ongoing contributions are necessary for your pension to grow, which could lead to a smaller payout when you retire. |
Leave of Absence Consideration | Sometimes, being on LTD is treated like a leave of absence. In this case, you may not earn any new pension benefits during this time, so your pension stays at the same level as when you began your leave. |
Steps To Safeguard Your Financial Stability
The best thing you can do is be proactive. These steps can protect your financial stability:
- Review Your Policies: Carefully review your LTD policy and pension plan to understand how they interact.
- Consult with a Benefits Admin: Your employer’s benefits administrator or financial advisor can clarify how your long term disability benefits impact your pension plan and guide you on the best action.
- Seek Legal Guidance: If you experience further concerns, your claim is denied, or if you’re unsure about the implications of accepting a settlement, consult a lawyer specializing in disability and employment law.
At Share Lawyers, our extensive experience in both disability and employment law uniquely positions us to handle cases where your LTD benefits and pension plan intersect. This dual expertise ensures we can effectively navigate the complexities involved, advocating for your rights and securing the benefits you deserve while protecting your future.
Share Lawyers Can Provide Comprehensive Support
If you’re concerned about the relationship between long term disability and your pension plan in Canada, you aren’t alone. Thousands of Canadians face this dilemma every year.
At Share Lawyers, we’re committed to protecting your rights and ensuring that you receive the benefits you need to ensure financial security when you’re unable to work. For over 35 years, we’ve practiced disability law and pride ourselves on our ability to advocate for our clients and lend them a helping hand.
“When we first met the lawyers at Share Lawyers, we were impressed by how they treated us. Professional, caring people who put me first. They answered my questions and understood my concerns. They said to call anytime if I have questions, and they were helpful. They made this crazy experience easier for me and my family. Trust Share Lawyers because they care for you first.”
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Let us help you understand your situation and handle the heavy lifting so you can focus on your health and future. We offer free consultations to get started and you won’t owe us anything until your case is won.
Need more information on long term disability and your pension plan in Canada? A conversation with one of our team members will help you understand your situation and provide a path forward.
Contact Share Lawyers today and let our 35+ years of experience work for you. We can help you win your case against Canada Life, Desjardins, Manulife, RBC Insurance, Sun Life, and other insurance companies.Our legal team offers a free consultation and works on a contingency basis. There are no fees unless you win your case.
