When Does My Disability Coverage End?

Employees who participate in a group benefits plan often enjoy coverage for prescription drugs, dental care, and life insurance, among others. Some group benefits plans include coverage for things like accidental death and dismemberment, and short term disability. Not surprisingly, among the more desirable benefits is long-term disability coverage.

However, as employees move or transfer from one employer to another, it is not always clear whether a particular claim is covered by the current benefits plan or the previous one. This is an issue that the Court of Appeal addressed in MacIvor v. Pitney Bowes.

In this case, the employee suffered a traumatic brain injury and a severe back injury while working for the defendant employer, Pitney Bowes. After returning to work, the employee’s performance deteriorated dramatically, leading to a reduction in his responsibilities. Out of frustration, he resigned and took a position with another employer, Samsung, shortly thereafter.

Unfortunately, his job performance continue to suffer while working for his new employer and he was eventually fired. He sought to make a claim for long-term disability, but Samsung took the position that because his injuries occurred while working for his previous employer, his claim would have to be made under the previous disability policy.

At trial, the judge reviewed the termination of coverage provision in the policy. The trial judge accepted the defendant employer’s argument that the employee was no longer entitled to make a claim under its disability policy because he was no longer actively employed. The employee appealed this decision to the Court of Appeal.

The Court of Appeal disagreed with the lower court’s decision. In its reasons, the court stated “the “Termination of Coverage” language relates to future claims, not claims that may have arisen during the course of the employee’s employment. In other words, if an employee’s claim arises as the result of an occurrence that takes place during their employment, the policy provides coverage.”

Thus, if an employee suffers an illness or injury that meets the definition of total disability under the policy, and the illness or injury occurs during a period of valid coverage, the employee is entitled to submit a claim provided that he does so within the timeframe prescribed under the policy. In this case, this applied even though the employee was no longer participating in the group benefits plan at the time the claim was submitted.

This article is intended only to provide general information and does not constitute legal advice. Should you require advice specific to your situation, please feel free to contact me to discuss the matter further.