Long Term Disability vs. Permanent Disability

There are many Canadians who will be unable to work for an extended period at some point in their lives. When this happens, disability insurance provides supplemental income that is essential to survive. But did you know that the level of support can vary significantly based on the duration of the disability?

If you're curious about long term disability vs. permanent disability, we're here to explain the distinctions and how they influence the benefits you might receive.

Need more information about long term disability vs. permanent disability? Share Lawyers’ experienced team will work with you.

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Long Term Disability vs. Permanent Disability

Understanding the differences between long-term disability and permanent disability is critical because it affects things like financial planning, legal rights and obligations, and who covers your benefits based on your disability.

Long Term Disability vs. Permanent Disability

Long Term Disability

Permanent Disability


An illness or injury that prevents employment for a prolonged period but is not necessarily lifelong.

A lifelong condition with no expectation for recovery, preventing any suitable or reasonable employment.

Duration of Benefits

  • Until the disability ends
  • Until the beneficiary can return to work
  • Until the beneficiary reaches retirement age

Typically for life or until a specified age.

Source of Benefits

Typically provided through private insurance policies purchased by individuals or their employers but can also come from government programs like the Canada Pension Plan (CPP) or provincial support programs.

Can be covered under government programs like the Canada Pension Plan (CPP) or provincial support programs or private insurance plans that may have been purchased.


Must meet the policy’s outlined definition of being disabled or be severe and prolonged to meet the government criteria.

Must be severe and prolonged and typically considered permanent under programs such as CPP.


To replace a significant portion of income during periods where work is impossible due to disability.

To provide financial support recognizing that the individual will unlikely return to work.

Long Term Disability Insurance Benefits

As you can see, there are significant differences between long term disability and permanent disability. If you find yourself unable to work due to an injury or illness for an extended period—though not permanently—you will likely depend on long term disability benefits. These benefits are designed to fill in the holes created by lost wages, ensuring you are supported during this challenging time.

In Canada, long term disability benefits typically replace 60-70% of your regular pay. To qualify, beneficiaries must meet specific requirements, including an elimination period, which usually lasts longer than 120 days. During this time, claimants are often required to exhaust all other available compensatory options, such as any short-term disability benefits, to ensure compliance with long term disability eligibility criteria.

If your long-term disability claim is approved, you can continue receiving benefits if you demonstrate an ongoing inability to work. This requires regular medical evaluations documenting your recovery. However, your benefits could be terminated (depending on the wording of your policy) if you are deemed capable of working in another occupation. Always check with a lawyer to see if your insurance company is treating you correctly and paying you your full entitlement.

If you encounter issues like an initial denial, a failed appeal, or termination of your benefits, you should consult a legal professional who can assess your case and advocate for your rights to secure long-term disability benefits.

Key Takeaways

  • Coverage: Long-term disability benefits are crucial when you cannot work temporarily. They are designed to replace a significant portion of your income during recovery.

  • Compensation: In Canada, LTD benefits usually cover 60-70% of your regular pay.

  • Eligibility Requirements:
    • Elimination Period: Beneficiaries must undergo an elimination period, typically exceeding 120 days.
    • Exhaustion of Other Benefits: Before LTD benefits kick in, claimants are often required to use all other available benefits, like short-term disability.
  • Duration and Compliance:
    • Ongoing Proof: Continuation of benefits usually requires proving ongoing inability to work through regular medical evaluations.
    • Termination Conditions: Benefits may cease if you are deemed capable of working, even in a different occupation. (this should always be reviewed by a lawyer)
  • Legal Assistance:
    • Denied or Terminated Benefits: If your long-term disability benefits are denied or unexpectedly terminated, seek legal help. A lawyer specializing in disability law can offer guidance, help you navigate the appeals process, and work to restore your benefits.

Share Lawyers Fights for Your Benefits

Now that you know the differences between long term disability vs. permanent disability, it’s time to consider your options. If you’re one of the many Canadians who are facing a long term disability denial or a termination of benefits, fear not because you aren’t alone.

Share Lawyers understands how frustrating it can be to be denied or lose income that you depend on. That’s why, for over 35 years, we’ve fought tooth and nail against insurance companies to ensure they pay their beneficiaries what they’re owed.

You’ll receive a free consultation, during which we will assess your case and explore your options to create a path to securing your benefits. Best of all? You won’t owe us anything until we succeed.

Still need more information on long term disability vs. permanent disability? Let Share Lawyers answer your questions and explore your options.

Contact Share Lawyers today and let our 35+ years of experience work for you. We can help you win your case againstCanada 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.

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