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what happens after your disability benefits are cut off?
4 minute read
if your long-term disability (ltd) or short-term disability (std) benefits have been cut off, it is vital to understand why this happened and what steps you can take immediately to protect yourself and your family.
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have you received a letter from your insurance company stating your disability benefits are being terminated, or are you living in fear this could happen?
being cut off from needed benefits is a deeply distressing experience. for many canadians, disability benefits are the primary—or only—source of income. when they stop suddenly, the financial, emotional and medical consequences can feel overwhelming.
the disability poverty report card in 2025 noted that working-age adults (18 to 64) face the highest poverty rates in canada, with an estimated 890,000 workers with disabilities living in poverty—1.8 times the rate of their non-disabled peers.
if your long-term disability (ltd) or short-term disability (std) benefits have been cut off, it is vital to understand why this happened and what steps you can take immediately to protect yourself and your family. receiving a notice of benefits termination is a critical moment that requires a swift response.
why insurers cut off benefits
a termination letter does not mean you are no longer disabled. in many situations, benefits are cut off for strategic or technical reasons, not because of a genuine improvement in your medical condition. insurance companies are businesses, and denying or terminating claims is a way they protect their bottom line.
common reasons insurers give for a disability benefits cut off include:
- claiming you can return to work in any occupation, not just your own
- alleging your condition has improved, based on reviews by their own paid doctors who have never met you
- using surveillance footage that is often taken out of context to dispute your limitations
- arguing your condition is “subjective” and lacks “objective evidence,” a common tactic for conditions such as chronic pain, fibromyalgia, migraines or mental health disorders
- stating you failed to provide sufficient medical documentation
- citing missed deadlines or minor paperwork issues
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most policies have a two-part definition of disability. during the first 24 months, the “own occupation” standard applies: you are considered disabled if you are unable to perform the essential duties of your specific job. after 24 months, the “any occupation” standard takes over, and you must prove you are unable to perform any job for which you are reasonably suited by education, training or experience.
under either standard, the insurer may argue you can work a different, less demanding job, even if your medical condition has not changed or has worsened. the strength and shape of your response will depend on which standard applies to your claim, but the underlying principle is the same: a termination letter is the insurer’s opening position, not the final word.
what to do right now
if you’ve received a termination notice, don’t panic. acting impulsively could harm your chances of successfully appealing the termination.
termination letters are written to sound intimidating and definitive. many benefit cut-offs, at both the own-occupation and any-occupation stages, are successfully challenged and overturned with the right legal strategy.
do not rush back to work. your first instinct might be to find work immediately to cover your expenses. however, returning to work prematurely can:
- worsen your health condition, leading to a significant setback
- be used by the insurer as evidence that you are, in fact, capable of working
- seriously undermine your legal position and ability to fight the termination
gather your documentation
it’s important to preserve all your documentation and gather everything related to your claim, such as:
- the termination letter and the envelope it came in
- your complete insurance policy document
- all medical records, test results and reports from your doctors
- any emails, letters, or notes from conversations with the insurance company
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why time matters
disability claims are governed by strict limitation periods. waiting too long after receiving a termination notice can permanently extinguish your right to sue the insurance company. once that legal deadline passes, your claim may be barred forever, no matter how strong your medical evidence.
be cautious with internal appeals
the insurer may invite you to submit an “internal appeal.” while this may seem like a reasonable first step, it is a process controlled entirely by the insurance company—the same company that denied you is the one reviewing the appeal.
in most situations, bringing in a disability lawyer to start legal proceedings right away gives you a much stronger negotiating position. it signals to the insurer that your claim needs to be taken seriously, which frequently results in a quicker, more favourable resolution—whether that’s having your benefits reinstated or securing a lump-sum settlement.
a termination letter can feel like the end of the road, but it rarely is. with the right documentation, the right timeline and the right advocate in your corner, you have far more power to push back than the letter wants you to believe.
nainesh kotak is the founder of kotak personal injury law, a firm focusing on protecting their clients’ rights to justice and obtaining the compensation their clients deserve. he is vice president of the ontario trial lawyers’ association, acting regional lead for the central west region on the justice of the peace appointment advisory committee, and a former chair of the long-term disability section of the ontario trial lawyers’ association.
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