Applying for long-term disability (LTD) benefits can feel like a game of cat and mouse, in which the insurer repeatedly invites claimants to appeal the denial of benefits internally. Often these internal appeals are met with further denials. What many claimants may not realize is that, while these internal appeals and denials are occurring, the time limit to bring a court action continues to run.
In Ontario, most long-term disability (LTD) policies give you two years to sue the insurer, and a few provide even less time. This time limit is known as a “limitation period”, and you may be unable to claim lost benefits in court if you permit that period to expire.
Long-term disability (LTD) limitation periods: when does the clock start?
One important question is what event actually triggers the running of the limitation period. While it is impossible to predict in the abstract, the law in Ontario since December 2014 is that the two-year timeframe (or, more rarely, the one-year timeframe) begins to run the moment you receive an “unequivocal denial” of your claim.
In other words, the clock will start to run when the insurer clearly denies your claim. The fact that the insurer invites you to pursue an internal appeal does not mean that the limitation period is not running. Once your claim has been clearly denied, the lawsuit clock starts ticking, and the time limit is likely not restarted by bringing an internal appeal.
Consult a disability lawyer soon after the initial denial
The take-away from the law on limitation periods in long-term disability (LTD) claims is that you should take action quickly after your claim is first denied. Even if you are still pursuing internal appeals, do not assume they prolong your right to sue, because the opposite is likely true.
A disability lawyer with expertise in long-term disability benefits can provide you with specialized advice, including on the issue of whether your claim has been clearly denied and your time limit for suing the insurer has started. So once you’ve received that first denial, contact a lawyer for a consultation to decide whether you should commence an action, and to learn about what other legal options might be available to you.
We are here to help navigate the LTD application process. Consult one of our experienced Long Term Disability lawyers at Raven, Cameron, Ballantyne and Yazbeck LLP if you are considering making a claim for disability benefits or if your claim for benefits has been denied.
[This article is for informational purposes only and does not constitute legal advice, which cannot be given without consideration of your individual circumstances.]