What Is Disability Insurance?

Disability insurance replaces part of your income if you become disabled and cannot work. A disability can come from an injury, a serious illness or a mental health condition, and it can be short-term or long-term.

Reviewed by Swinder Singh, Licensed Life Insurance and Accident & Sickness Insurance Advisor in Ontario (FSRA licence #08105406), SSJ Financial. Last content review: October 11, 2026.

Types Of Coverage

• Short-term disability (STD): pays a percentage of your salary when an injury or illness keeps you off work for a limited time, so your income is protected while you recover.
• Long-term disability (LTD): is for when you need a long recovery or cannot return to work at all. It protects your income over a longer period.

Why Do You Need Disability Insurance?

Income protection is available for professionals, business owners, executives and full-time, part-time or home-based workers. You may want it to protect your main income, or to top up the coverage you get from an employer or association. An individual plan is portable, so it stays with you through your working years.

A disability income benefit pays you part of your income when an injury or illness stops you from working. You choose the elimination period, which is how long you wait before benefits begin, and the benefit period, which is how long benefits are paid. That lets you fit the plan to your needs.

How Does It Work?

• Choose the benefit amount and add optional benefits to fit your needs.
• Pay your monthly premium.
• File a claim if you become disabled.
• Your monthly payments start when the waiting period ends. The waiting period is the number of days between the date you become disabled and the date benefits start.
• Your payments stop when your benefit period ends or you return to work.

Disability Insurance FAQs

Who needs disability insurance?

Anyone who depends on their income. It matters most for self-employed people and for workers who do not have disability coverage through an employer or association.

What is the difference between short-term and long-term disability insurance?

Short-term disability pays part of your salary for a limited time while you recover. Long-term disability protects your income when recovery takes a long time or you cannot return to work.

What is an elimination period?

It is the waiting period before benefits begin. It runs from the date you become disabled to the date your benefits start.

How long are disability benefits paid?

For the benefit period you choose when you buy the plan. Payments stop when the benefit period ends or you return to work.