Benefit percentage
Benefits replace a specified percentage of eligible earnings, up to the maximum amount provided under the plan.
Disability Benefits
Helping protect income when employees are unable to work.
Short-term and long-term disability benefits can help replace a portion of an employee's income when illness or injury prevents them from working. We help employers design coverage that is clear, coordinated and sustainable.
Income protection · Absence support
Disability coverage at a glance
Protection for both shorter and longer absences.
Short-Term DisabilityIncome replacement during the earlier stage of a qualifying disability, typically before LTD begins.
Long-Term DisabilityOngoing income protection for qualifying disabilities that continue beyond the LTD waiting period.
Benefit amount & maximums
Waiting periods & duration
Definitions of disability
Plan terms & coordination
Short-term protectionCoverage for the initial stage of a disability.
Long-term protectionIncome support when a disability continues.
Plan coordinationSTD, LTD, sick leave and other programs working together.
Independent adviceCompare plan design and pricing across insurers.
Why disability coverage matters
Employee benefits should support both health and financial security.
Health and dental benefits help employees manage the cost of care. Disability benefits address a different risk: the loss of employment income when an employee cannot work because of a qualifying illness or injury.
For employers, disability plan design involves more than choosing a benefit amount. Eligibility, waiting periods, disability definitions, benefit limits, funding and coordination with other programs all influence the protection provided and the cost of the plan.
We help employers weigh these considerations and develop a disability program aligned with their priorities and approach to employee benefits.
Core coverage
How STD and LTD fit together
A coordinated disability program helps maintain continuity of support throughout an employee’s absence.
Earlier stage
Short-Term Disability (STD)
Designed for shorter disability absences, with benefits beginning after the applicable waiting period and continuing for the maximum period set by the plan.
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Longer absence
Long-Term Disability (LTD)
Designed for extended disability absences, with benefits beginning after the elimination period and continuing while the employee meets the applicable requirements of the plan.
The timing of STD and LTD should be aligned so that one form of coverage transitions appropriately to the other.
Waiting / elimination period
The length of time between the start of a disability and when benefits become payable. It should be considered alongside sick leave and other disability coverage.
Maximum benefit
Benefit maximums should be assessed against employee earnings to determine whether coverage remains appropriate across different salary levels.
Definition of disability
The criteria used to determine disability can change after an employee has received LTD benefits for a specified period.
Integration & offsets
Other income received during a disability can affect the amount payable under the plan, making coordination provisions an important part of the coverage.
Return-to-work support
Disability programs may include rehabilitation, case management and return-to-work services that assist employees in preparing for an appropriate return to the workplace.
The objective: meaningful protection without unnecessary complexity.
A strong disability plan makes it easier for employees to understand what happens if they cannot work, while giving the employer a sustainable structure for income protection, absence management and long-term plan costs.
Plan design
The right provisions make a meaningful difference.
Similar-looking disability plans can differ significantly in how coverage applies when an employee makes a claim.
01
Coordinate STD, LTD and sick leave
Structure STD and LTD so employees have a clearly defined path of income protection as a disability continues.
02
Review benefit levels against salaries
Test the benefit formula across the workforce to identify where coverage may fall short of the intended level of income replacement.
03
Understand the definition of disability
Compare how each plan defines disability, as this provision can have a significant impact on whether benefits continue during a longer claim.
04
Consider premium-sharing and tax treatment
The way LTD premiums are funded can influence whether benefits are taxable when received, making the contribution arrangement an important design consideration.
05
Review eligibility and evidence requirements
The amount of coverage available to an employee can depend on underwriting requirements, applicable limits and employee classification.
Independent market access
Look beyond the premium.
Disability insurance is highly contractual. Pricing matters, but so do definitions, maximums, claims provisions, rehabilitation support, evidence requirements and how the coverage fits with the rest of the benefits program.
As an independent advisor, GroupBenefits.ca can evaluate the plan across leading Canadian insurers and explain the trade-offs in practical terms.
What we compare
- STD and LTD benefit schedules
- Waiting periods and maximum durations
- Definitions of disability
- Weekly and monthly benefit maximums
- Non-evidence maximums and underwriting requirements
- Integration, offsets and rehabilitation provisions
- Rates, renewal terms and overall plan fit
Cost & structure
What influences disability plan cost?
Pricing reflects the characteristics of the insured workforce and the coverage selected. A lower rate should be weighed against what the plan actually provides.
Factors that can affect cost
Disability pricing can be influenced by the demographics and occupational profile of the workforce as well as the structure of the benefit.
Employee demographicsOccupation / industryBenefit percentageMaximum benefitWaiting periodBenefit durationClaims experiencePlan size
Questions worth reviewing
Effective cost management begins with understanding what is driving the current plan before considering changes to benefits.
Is STD needed?Compare insured STD with salary continuance or sick-leave arrangements.
Are maximums adequate?Test weekly/monthly maximums against current salaries.
Are waiting periods coordinated?Look for gaps or unnecessary overlap between programs.
Who pays the premium?Review premium-sharing and potential tax implications.
Frequently asked questions
Disability benefits, explained.
These answers address common questions employers may have when reviewing disability coverage.
What is the difference between short-term and long-term disability?
Short-term disability is designed for the earlier stage of an eligible disability and pays for a limited period. Long-term disability begins after a longer waiting or elimination period and is intended for disabilities that continue for an extended period.
Does every group benefits plan need short-term disability?
No. Some employers insure STD, while others use employer-paid sick leave or salary-continuance programs. The right approach depends on the workforce, budget, administrative preference and how the arrangement coordinates with LTD.
How much income does disability insurance replace?
The percentage varies by plan. STD is typically expressed as a percentage of weekly earnings and LTD as a percentage of monthly earnings, each subject to plan maximums and other contract provisions.
Are disability benefits taxable?
How disability coverage is funded can have tax implications for benefits received by employees. Employers should review their contribution arrangement with their advisor and obtain appropriate tax guidance.
What does “definition of disability” mean?
It is the contractual test used to determine whether an employee qualifies for disability benefits. LTD contracts commonly distinguish between inability to perform one's own occupation and inability to perform another suitable occupation, subject to the specific wording of the policy.
What happens when STD ends?
When STD benefits end, an employee may move to LTD if the elimination period has been completed and the requirements for LTD benefits are met.
Can an existing disability plan be reviewed without changing insurers?
Yes. A review can identify gaps in benefit levels, maximums, waiting periods, definitions and premium-sharing before deciding whether a market comparison or insurer change is appropriate.
Review your disability coverage
Does your current plan protect employees the way you expect?
We can review your STD and LTD structure, benefit levels, contract provisions and pricing—and explain where the plan is strong and where it may need attention.