Facts about the union LTD plan

What would it cost?
The union, working with Canadian Benefits Consulting Group, has already created a Plan for the engineers at CPR. It is geared to be affordable and yet still able to meet the sometimes quite substantial needs of our disabled members. Based on our experience we have established a premium that is 1.5% of gross wages.

Is it worth it? Let’s look at some numbers.

If you earn a gross pay of $6,000 per month, your LTD premium will be $90. For your $90 per month premiums to equal the amount that you would receive in benefits for a two year disability would require over 38 years of monthly payments. We think that’s good value for the money.

Will my premiums go up?
To ensure against future premium increases we have created a reserve fund to prepare against anything unforseen. As a result the TCRC LTD is well-cushioned against any potential future premium increase.

Benefits are tax free
Any benefits that you receive from the LTD Plan will be tax-free, since it will be already taxed income.

What would the LTD Plan cover?
The TCRC LTD Plan would cover any and all injuries or illnesses that left you Totally Disabled and unable for work. There is also a mechanism in the Plan specific to the needs of Railworkers. If you are not Totally Disabled but are unable to return to work at your own craft, according to the terms of the Railway Safety Act, the Plan will still cover you for a period of up to a year.

Your future is secure
As long as you are Totally Disabled the Plan will provide you with the income you need. Even if the Plan were cancelled for any reason you would continue to receive benefits, as long as you were Totally Disabled. That’s because as soon as you reach 41 weeks of disability, we put aside enough money to ensure you receive benefits for as long as you need them, until retirement if necessary.

Is it complicated to qualify if I ever need it?
The TCRC LTD Plan is as straightforward as they come. Unlike other plans, there’s no hoops to jump through or endless streams of forms to track down and fill out. Suffering a disability can be stressful enough without having to deal with bureaucracy.

If you become sick or injured and are still unable to work after 30 weeks you will be sent an LTD invitation package that includes applications for LTD benefits, Canada Pension Plan Disability Benefits, and CPR Disability Pension Benefits.

This will ensure that we can get things moving for your before your WIB expires. That way if there are any hitches we’ll know well before your 41 weeks are up.

As soon as the end of your Weekly Indemnity Benefits is reached, the LTD Plan automatically kicks in. It immediately provides you with a tax-free benefit equal to 50% of your gross monthly income, up to a maximum of $5,000 per month.

Your union, your Plan
The TCRC Long Term Disability Plan is owned by the members and operated by the Board of Trustees. That makes it different than any plan by an insurance corporation.

It is our Plan, under our control. You control the Plan through the union’s Board of Trustees who oversee the Plan’s operation.

The Plan that covers the engineers has the following Board of Trustee structure: There are four members on the board at present, Vice President George Hucker, General Chairmen for engineers-west, Dave Able and General Chairmen for engineers-east, Tim Beaver. The fourth member of the board is a lay appointee, Jim Flegel.

For the membership, not for profits
Union control of the Plan is a guarantee that it is run for the benefit of the membership, not to add to the profits of a big insurance corporation or its shareholders. What does that mean? Because there are no commissions, profits or dividends to pay, almost 90% of premiums go directly towards members’ benefits.

Also, if the LTD Plan runs a substantial surplus, that money comes back to the Trust. In corporate controlled plans, any surplus is returned to the coffers as profit.

It also means that it is your union brothers who decide the eligibility of members to receive benefits and not faceless bureaucrats whose eyes are only on the bottom line.

How is the Plan administered?
At the centre of the TCRC LTD Plan is the Board of Trustees. They oversee all aspects of the Plan. The Board meets four times per year to discuss the previous quarter and any issues that have arisen in that period – financial, legal or disputed claims..

The Board works through a Third Party Administrator (TPA), which has been contracted to provide day-to-day administration of the Plan and advice to the Board. The company that provides that service is Canadian Benefits Consulting Group. The Plan Manager is Lynn Cross.

To make sure that the Plan is running smoothly we also hire professionals to handle our needs beyond day to day administration. Legal advice is handled by Caley Wray, auditing is by the chartered accountant firm BDO Dunwoody, and financial advice is provided by CIBC Wood Gundy.

The total cost for the administration of the Plan as a proportion of premiums received is as follows: 5% of the premium goes to the Plan carrier, Great West Life. Another 5% goes to the TPA, and .07% of the premium is used to operate the Trust. Because we are not profit-based 89.93% of members’ premiums go directly to the membership.

The structure of the Plan also means that there is maximum interaction and communication between the different components, to ensure that nobody is working at cross-purposes to anybody else.