Can her disability benefits be seized by her creditors?

Paola, an employee at Horizon Pharmaceuticals, was recently diagnosed with depression. She is unable to work and is receiving tax-free disability insurance benefits due to her condition. Paola is deeply indebted, and her creditors have been garnishing a portion of her pay for the last year. She is worried about her creditors also garnishing her disability benefit.

Can her disability benefits be seized by her creditors?
A . Yes, disability insurance benefits are seizable.
B . Yes, but creditors can only seize up to 50% of her benefit.
C . No, because the benefits are tax-free.
D . No, because she is disabled.

View Answer

Answer: D

Explanation:

In Quebec, disability insurance benefits are generally protected from seizure by creditors. This protection is designed to ensure that disabled individuals retain access to essential income for their well-being during their period of disability. Since Paola’s benefits are designated as disability income, they are exempt from garnishment.

This aligns with Quebec’s laws on disability and insurance benefits, which prioritize financial protection for individuals facing health-related work absences. Thus, her benefits remain protected, regardless of her tax status or existing debts.