Unlocking Hidden Savings: How CPPD Inefficiencies Cost Insurers—and How We Fix It

The Canadian Life and Health Insurance Association CLHIA has long touted the value of integrating Canada Pension Plan Disability (CPPD) benefits into long-term disability (LTD) plans. For decades, this practice of offsetting private LTD payouts with CPPD has kept premiums affordable for employers and policyholders alike. ?It’s a win-win in theory: insurers reduce their liability, and the system stays sustainable. But in practice? The cracks are showing—and they’re costing group benefit providers millions.

The problem lies in CPPD’s execution. With initial denial rates over 60% and approvals often taking four months or more, according to Service Canada trends, the process is anything but seamless. For insurers under the CLHIA umbrella, every failed or delayed CPPD application translates to real money left on the table. Picture this: an LTD claimant receives $2,000 monthly from their insurer, but CPPD could offset $1,000 of that. If the application stalls or gets denied, the insurer foots the full bill—month after month. Across a portfolio of thousands, that’s a significant bleed.

Why does this happen? CPPD’s eligibility bar is high—disabilities must be “severe and prolonged”—and the application process demands meticulous medical evidence and persistence through appeals. Insurers typically require claimants to apply on their own, but their in-house disability managers, stretched across multiple priorities, often lack the specialized focus to navigate this bureaucratic maze especially when cases are at reconsiderations or worse at the Tribunal. The result? Too many cases don’t secure the offset, leaving insurers overpaying when they shouldn’t.

The CLHIA acknowledges offsets as a cornerstone of cost management—back in 2015, their Director of Disability Policy, Laurie Down, called it a “decades-old practice” essential for affordability. Yet, there’s a gap between the principle and the reality. While the association doesn’t publish hard data on how much these inefficiencies cost its members, the math speaks for itself. If 40% of LTD claimants fail to secure CPPD (aligned with national trends), and each un-offset case costs an insurer $12,000 annually, a mid-sized portfolio of 1,000 claimants could mean $4.8 million in lost savings. For larger players, the stakes are even higher.

At Brematson, we saw this as more than a problem—it’s an opportunity. That’s why we developed our Brematson Efficiency Pathway?, delivered through our proprietary Segmentation Model, to turn CPPD bureaucratic complexities into tangible gains for group benefit providers. Here’s how it works: we don’t just manage every case the same way. Our Segmentation Model identifies which claimants have the highest potential for CPPD success via viability reviews—based on claimant profiles, medical profiles, disability type, and government disability case law—then we tailor our approach accordingly. The Brematson Efficiency Pathway? takes it further, streamlining applications with precision, securing robust evidence, and cutting through delays to boost approval rates and speed up offsets.

The impact? Insurers see faster CPPD approvals—reducing the months they pay full LTD amounts—and higher success rates, meaning more offsets stick. For a claimant approved in three months instead of nine, that’s thousands saved per case. For a portfolio, it’s a game-changer. Plus, by outsourcing this specialized work to us, insurers free their disability manager’s teams to focus on core priorities like return-to-work programs, not wrestling with Service Canada and all that entails including follow ups etc.

The CLHIA’s vision of offsets as an efficiency driver is spot-on—but it’s only as good as its execution. We’re here to bridge that gap. ?Our data-driven, segmented approach isn’t just a service—it’s a partnership to align theory with results.

So, to my peers in the group benefits space: how much could CPPD inefficiencies be costing you? Let’s talk about closing that gap—and turning lost dollars into strategic wins. Reach out if you’re ready to see the numbers for yourself.