Major Canadian insurers are no longer resetting the long-term disability pre-existing condition clause for women whose benefits coverage lapsed during their maternity leave when they return to work.
Women covered by these insurers — which include the Co-operators Group Ltd., Desjardins Insurance, Empire Life Insurance Co., iA Financial Group, Manulife Financial Corp., RBC Insurance and Sun Life — will retain the same benefits after they return from maternity leave as they had before.
Previously, women who stopped making contributions to their benefits during their leave would be treated as a new hire when they re-enrolled in the plan and would have to re-satisfy the pre-existing conditions clause.
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If they’d received any care, including prescription medications, for an illness during the 90 days before they returned to work, those conditions would be considered pre-existing, says Dave Patriarche, president of Mainstay Insurance Brokerage Inc. and founder of the Canadian Group Insurance Brokers.
An example, says Patriarche, is a woman who experienced postpartum depression after the birth of her child but was able to return to work after seeing her doctor, only to experience the death of a family member that prompted a depressive episode. And, as a result, she needed to take disability leave.
“That would be a legitimate disability, but because she was treated for postpartum she wouldn’t be eligible for disability,” he says. “In my mind, she should come back whole the same way she left. We wanted the insurance industry to agree she should come back whole.”
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Patriarche led the changes, first reaching out to the major insurers, as well as the Canadian Life and Health Insurance Association, in 2017 to determine their policies around the LTD clause. At the time, around a third of insurers said they reset the clause, with the other two-thirds said they didn’t. “We put the pressure on . . . and did a seminar in November [2019] to raise awareness among advisors,” he says.
As of December 2019, all surveyed insurers had committed to not resetting the clause when women return to work. However, Equitable Life of Canada told Benefits Canada in an email that it’s in the process of updating its contract and plan member booklet wording, which will go into effect on March 1, 2020.
“A new LTD pre-existing condition period will no longer apply when an employee re-enrols in the benefits plan after their maternity leave ends,” wrote Don Bisch, director of group marketing for Equitable, in the email. “We will be communicating this change to plan administrators and their advisors later this month.”
In 2018, Sun Life changed its practice to align with multiple provinces’ employment standards legislation, which requires “when an employee returns to work from a statutory leave, such as maternity/paternity leave, that their earnings and benefits are in the same position as they were at the start.”
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Patriarche has asked the CLHIA to develop a new guideline on the practice to bring insurers across the country into alignment.
In an email to Benefits Canada, Joan Weir, CLHIA’s director of health and disability policy, said the association applauded the insurers’ policy changes. “It is common with group insurance that when a plan member leaves work for a period of time and payment of disability insurance premiums is discontinued, the pre-existing clause is reset once they return to work. This is true no matter what reason for the leave.
“In the case of maternity leave, the industry has been shifting away from resetting the pre-existing clause. The CLHIA is supportive of this. Of course, we would also recommend to women planning a maternity leave to consider continuing to pay into their disability insurance, as disability can occur while on leave as well.”