What are Short-Term Disability (STD) Benefits?
The reality for many of us is that we live paycheque to paycheque. As a result, the impact of time off work due to illness or injury can be significant. STD coverage helps provide you with the security of replacement income while you focus on your recovery and return to work. Short-term disability can bring uncertainty, but imagine the comfort of knowing that although you are unable to work, you can help pay the bills and support your family through your STD benefits payments.
How are benefits calculated?
STD benefits payments are based on a specific percentage of your monthly earnings at the time you become totally disabled.
When do benefits start?
Once your claim is approved, payments will be paid from the date the elimination period is completed. For most plans, there is not an elimination period for disabilities due to injury or illnesses that require hospitalization. If an illness does not require hospitalization, the elimination period is usually 8 days.
How long will I receive my disability payments?
You will continue to receive STD disability payments as long as you are totally disabled, to a maximum of 17 weeks. If your disability persists beyond 17 weeks you would then become eligible for Long-Term Disability payments.
Who pays the premiums, and WHY?
We recommend that employees pay the premiums for STD. Canada Revenue Agency rules require that disability insurance benefits be considered taxable income if an employer has paid any of the premiums. In order to maximize the benefit that employees receive in the case of a disability, they must pay the premiums. This ensures that any benefits received are not taxed.