CPP Disability/LTD

Hi there,

I was hoping someone could answer this question on this forum. I have been receiving CPP disability for 4 years and LTD for over 2 years going on 3 years next year. I have a catastrophic injury and my life is pretty much changed from a severe accident. I came into money from a settlement and my family wants me to invest and buy a property and rent it, oppose to sit in a bank and collect minimal interest. In my previous employment I had a very successful career and worked hard, I am very educated and made really good money which now with this has changed everything. I have lost on gainful employment because of this illness and injury. I was wondering if I can buy and rent a property with being on LTD and CPP disability? My family will manage anything and it would help me for my future medical costs and things I need to live comfortably with my horrible circumstance of pain and not being able to function as I once did. Thank you for any advice.

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Do you have a benefit booklet about the the insurance policy?
I don’t know if insurance companies can offset settlements from LTD.
Neither LTD nor CPPD are means tested so you can own anything, have investments, etc.
Best wishes.
I’m not an investment guy but I’d talk to a financial person.
I wonder whether property is a good investment unless you have 30 years.
Mutual funds or GICs are options.

I have GICs and Mutual funds. Investments of property is a good source of income at this time as the banks GIC’s are not the best interests. As I said my family will manage the property but a source of investment will bring a higher interest for me at this time. Any other suggestions or opinions from anyone would be appreciated.

Also look into the DTC (Disability Tax Credit).
It may lower the tax you owe.
If you’re under 50 then you can open an RDSP and get free money from the government. :slight_smile:

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Hi Viva. Here’s a document you may want to read:

And this one: https://turbotax.intuit.ca/tips/dos-and-donts-cca-for-rental-property-explained-6377

If this is your first home - and you are immediately renting it after purchase - you will NOT qualify for the First Time Home Buyers Plan where you can use any RRSPs towards the down-payment. You should also get pre-approved if you require a mortgage. One other thing - due to having a pre-existing disability - it’s unlikely the bank with give you life/disability insurance on the mortgage. There’s a lot of things to consider.

My question to you would also be - has the Disability Insurer guaranteed you that you are permanently disabled. If not and they believe at some point you may be able to work - there’s a good chance they will continue to pursue that avenue - especially depending on your age. I was approved for LTD beyond the 2 year mark and then after 6 months into my 3rd year they decided I was no longer permanently disabled and cut off my benefits. I fought back, was denied again and then had to hire a Disability Lawyer. After a year of pursuing legal action against the Disability Insurer my employer discontinued further benefits and terminated my employment due to a “Frustrated Contract”. As I had just turned 55 they then encouraged me to retire. I had no choice as we had been living for 18 months without my high income. Losing my employer also meant there was no hope of getting back on the LTD Benefit plan therefore I had to sue for Compensation. 6 months after retiring with my Employer the Disability Insurer settled. It was the most terrifying time of my life. I had been with my Employer for 36 years - the last 4 of those I was on Disability. I felt mistreated, was in deep debt, my once great credit rating was trashed and we were on the edge of losing our home. By the Grace of God we were able to keep the house and pay off our debt load after my retirement and getting the settlement.

I found that the Insurance Company was brutal the entire time and my health had greatly deteriorated due to their constant pursuit to get me back to work. Personally, there needs to be more laws regulating their actions - but that’s a whole other conversation.

My personal advice to you would be to ensure you set yourself up so that SHOULD the Disability Insurer cut off your benefits - you absolutely need to be prepared for that! Don’t get yourself in a position where you are fighting to not end up on the streets. Purchasing and renting a home will only pay the costs of the mortgage, utilities and upkeep. Should the home require any major repairs - roof, furnace, water heaters, etc. - you need to ensure you have the income to fix those for your Tenants. Also - PLEASE PLEASE I beg you to call all 3 (at least) of their former Landlords. I speak from experience! I purchased a really nice home - put $30,000 worth of repairs and upgrades into it - rented it to what I thought was a nice young family. I always got my rent on time - I would visit them now and again - everything seemed great. After 3 years we offered them the opportunity to purchase the home. We gave them another 2 years to come up with a downpayment and work with a bank to get pre-approved for the mortgage. However, they couldn’t purchase it at the end - I brought a Realtor in to inspect the home (we went with him) to give us a re-sale value. OMG - the house had been trashed! There were holes in walls & doors, the dog they had defectated on every available spot outdoors because they never picked it up! I have at least 100 photos of all the damage done. Brand new carpets were so badly soiled they had to be replaced. I was devastated. We also found legal paperwork they left behind that showed they had been arrested for abandoning their small children and were drug dealers. Could it have gotten any worse!

Anyway - that’s my personal advice. Ensure you have enough income in case you’re cut off of disability and have to hire a lawyer and should you decide to purchase a home and rent - make darn sure you call their references!! Homes are not much of an investment in my opinion only because our house prices have not increased since 2009. Again, I speak from personal experience. And even if they do - you’ll only reap the benefits upon the sale of the home. Again - my personal opinion.

Thank you Caramel. You don’t know how I appreciate your time on writing all of this. This is great information you provided and it is something I really am going to look over. Your situation was crazy and you handled it so well. I am sorry you had to go through this. It is crazy that we have to struggle when at one point I made amazing income and I am very educated. Thank you again for your advice.

Thank you

Hi Caramel, thank you for telling your story and experience. Could you please explain this a bit further? Why losing the employment means you will not get back on the LTD benefit plan ( do you mean to be reinstated back to the monthly benefit?) I thought they were separate issues, as all Ltd contract states as long as you disabled for any job, they will have to pay for the monthly benefit til the agreed age. So your lawyer could help you to fight for reinstatement regardless of losing employment to my understanding although lots of cases settle?

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LTD is a contract with the insurance company.
Once there is a claim, it has nothing to do with the employer.
Rory is correct.

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Once my Employer disconnects from me I am no longer employed therefore if the Insurer refuses to reinstate me, which is what their ultimate goal is, there’s no support. I’m just an unemployed person trying to get LTD. My employer paid my health and dental benefits as well as continuing to pay into my pension plan. Once they terminated me all that stops. And Manulife had cut me off prior to the Employer - so I’m stuck in limbo and all I can do now is get a settlement. Had Manulife not denied my appeal while I was still supported by my Company there’s a chance I could have been reinstated. However my friend - even though the contract says that once you’ve been approved beyond the 2 year mark doesn’t guarantee you a safety net. They continue to come at you hard to prove you’re not sufficiently unable to work. They’ll send you to many assessments, surveil you, etc. There’s a great likelihood that you’ll never be on LTD until 65. Not if they can help it. You will have to prove over and over again why you can’t work and they determine if the paperwork and their Drs agree. It’s exhausting and debilitating and that’s their goal. They hope you’ll give up the fight and go work or go on some other social plan. They’re in the business to make money - not give money. I despise them. I don’t know how they live with themselves.

I don’t know why you can’t sue to get LTD back.
You don’t need to be employed.

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In my case I did need to be employed. My employer paid for all my health, dental, life and disability benefits as well as contributions to my DB Pension Plan. The Insurer wasn’t interested in putting me back on LTD, they always prefer to just settle. And even if I had been put back on LTD (which would have been a huge battle to get), Manulife most likely would have put me through all this again in 6 months. That’s what they do. You’re constantly going to be proving your incapability to work.

Caramel, do you have any CPPD?

Hey Jammer. I do have CPP-D. I received it about 4-6 months after going on LTD. After I got my Settlement I applied for the CRA Disability Tax Credit and was approved for that right away also. I presume I could have tried for more with Manulufe but they literally had me. “by the balls” so to speak as it had been well over a year without benefits plus my Employer terminated my employment so not only was I without income I was now unable to buy the drugs I needed. We investigated bankruptcy, selling the house, moving into our 5th Wheel, almost everything you can imagine. The stress was deteriorating my health even more much to the dismay of my Specialist who also wrote a scathing letter to Manulife as did my Family Dr. but they wouldn’t budge. They’re heartless and unrelenting. I was more than happy to take a settlement - my credit rating was trashed - my health was trashed. I just wanted out from under it all. The day Manulife called to tell me they were cutting off my benefits I told them I may as well just “off” myself. She didn’t care - she just called my GP but it didn’t chg their mind now that I was also now suicidal. They also didn’t inform my Employer they cut off my benefits. She instead told me there were no jobs available at my Employer’s and I would just have to look for another job. She lied so many times and yet none of the conversations were written down in the paperwork during Discovery. Ugly ugly time in my life. It’s been 8 months since it all settled and I’m finally starting to heal financially, mentally & physically. It was the biggest nightmare of my life and I have a huge distaste for all Insurance companies.

I want to add that your LTD policy with your insurer takes precedent over CPPD. Just because CPPD allows you to have an income, your insurer may not.

My insurer states I cannot engage in any business. None.
I cannot volunteer either.
Had a business been in place before and I reported it on my initial application I may have been able to keep the income but according to the basic clauses, it looks like this would be a no.

Others on my plan have previously been able to engage in ‘under the table’ monies (cab drivers with back problems, hobby crafters, even someone with arthritis was cutting cords of wood to sell) however, in cost saving measures my employer blindsided my insurer at the last minute by canceling the decades long contract the same month I was due to transition into LTD.
I am under intense scrutiny as the sole LTD plan member potentially for 20 more years.

I just think having CPPD makes it less likely the insurance company would cut a person off and even if they do, it makes a successful lawsuit more likely.

Hi Caramel. Sorry to hear about all the trouble you had to go through. How many month of your payments do you get as a settlement?

I feel like my insurer may cut me off soon. Just wondering if it worth while suing them at all.

How many month of your payments do you get as a settlement?

Elaine - Settlements aren’t calculated as such - and I’m sworn to a Non-Disclosure contract. What I will tell you is that if you are successful in negotiating a cash settlement they will pay for all the months you were denied up to the settlement date and it’s taxed as income. Plus your legal fees will come out of that. I’m told that you can claim the legal fees on your Taxes but honestly I have no idea how it’s done. Anything cash above this is tax free but again, a portion goes to the Lawyer. Or you could try and get reinstated on LTD but there’s no guarantee that 3 or 6 months down the road they won’t do this all over again plus you will need something more substantial medically new to convince them to put you back on LTD.

Is it worth it? For me it was. I have Lyme Disease and it’s a life sentence. I feel I could have gone all the way to Court however I had enough of fighting them and having no income. I was debt-ridden and bed-ridden. Mentally I was also in a very dark place. It took everything I had to sue them but I wasn’t going to let them get away with all they did. My Settlement was a drop in the bucket for a billion dollar insurance company and they can drag it out as long as they want. Personally I like to believe they knew I would have had a good court case and chose to settle after a year from the time my Lawyer contacted them.

You have to decide for yourself if it’s worth it. I’m not privy to your personal medical history. Insurers depend on the sick not having the strength to fight them. It’s really your Lawyer that does the fighting. And you would have to decide if your case is strong enough and only a Disability Lawyer can advise on that. I was given a free hour to consult with my Disability Lawyer for both of us to get an understanding of my situation. He agreed it was a good case and we signed a contract that day. So line up a few lawyers and take advantage of the free 30-60 legal consult if you’re on the fence about suing. My best to you Elaine.

Thank you so much for taking time to write all this! Appreciate it. I’ll see how it goes.