What is Employees Deposit Link Insurance Scheme?
Employees Deposit Link Insurance Scheme 1976 is a scheme provided to the employees of private companies or organization who are member of Employees Provident Fund schemes, 1952 or Provident Fund schemes exempted under section 17 of the EPF and MP Act, 1952.
Whenever a person starts his job in a private organization and his monthly salary falls under the Provident Fund eligible ceiling, then the person become a member of Provident Fund. Aside that the person by default become an eligible member under the Employees Deposit Link Insurance Scheme 1976.
The employee no need to contribute to get the benefit towards the Employees Deposit Link Insurance Scheme (EDLI). The EDLI scheme is supported by the employer and the employer contribute a nominal contribution of 0.50% on the Provident fund eligible monthly wages of the employee up to maximum wages ceiling of Rupees 15000.
Eligibility Criteria for Employees Deposit Link Insurance Benefit
Earlier the EDLI benefit was provided to those employees who covered under the EDLI scheme and worked continuously for a period of twelve months in the same establishment preceding the month in which he died.
But the Central Government revised eligibility criteria vid notification no- GSR 299(E) dated 28.04.2021.
As per revised notification, EDLI benefit is even provided if the employee switch his job/employer/establishment during the twelve month continuous service preceding the month in which he died.
It is expected that this shall be particularly benefited to those contract employees or other employees who changed the job very frequently.
Enhanced Benefits Under EDLI Scheme
The Maximum benefit payable under the scheme to eligible family member of the deceased employee under the scheme was earlier 6 lakhs which has been revised and enhanced to 7 lakhs.
Another beneficial provision which has been included under the scheme with effect from 28.04.2021 is that the minimum benefit payable as EDLI Assurance is not less than 2.50 lakhs to the eligible family member to the maximum limit of rupees 7 lakhs.
Employees Deposit Link Insurance Benefit Calculation Rules
According to MAP(II-B) of EDLI Scheme, 1976 Para 2.2.1 The Assurance Benefit is payable under the scheme on the death of the member “While in Service“
According to Para 2.2.7 in case an employee was on leave without pay and no contribution was paid against such leave period or the employee absent for some other reason and the employee died during such period then assurance benefit is admissible irrespective of the fact that no contribution was paid by the employer. But the employee name must be recorded in the Muster roll of the organization on the day of death and satisfied the prescribed condition.
Nominee or legal heir of the deceased eligible member under the scheme may get 35 times of the average monthly wages (subject to the maximum wages ceiling of rupees 15000) during the 12 month preceding to month in which the member is died.
In addition to that the nominee or legal heir also eligible to get an additional benefit of 50% of the average balance available in the EDLI account of the deceased member or rupees 175000 whichever is less.
ELDI Calculation Formula with Example
Lets assume the Average Monthly Salary of an employee is rupees 12000 (subject to maximum ceiling of rupees 15000)
Then, 35 times of the Average Monthly Salary of rupees 12000= 35*12000= 4,20,000.
Additional Benefit= 1,75,000
Total EDLI Assurance Benefit= 4,20,000+1,75,000= 5,95,000
Nomination to Get the EDLI Benefit
To get the EDLI benefit, provident fund member mandatorily required to file the nomination against their EPF account. The nomination process is completely online and easy to submit. To know more about the process of online nomination filing you may click here.
How to apply for EDLI benefit in case of death of an Employee?
In case of deceased of the employee covered under the EPF and MP Act, 1952, the nominee can apply for EDLI benefit along with provident fund and pension.
The application can be done online and offline both. The following are the forms required to submit by the nominee duly attested by the employer at respective PF office.
- Form 10D ( For Pension)
- Form 20 (Composite claim Form for PF)
- Form 5IF (For EDLI)
For online death claim following condition must be met by the nominee:
- Active UAN number.
- KYC like Bank, Aadhaar and PAN of the member must be seeded against the UAN.
- Nomination must be filed against the UAN number.
List of Documents Required for Death claim?
Following documents required to apply in case of death of the employee covered under the scheme:
- KYC like PAN, Aadhaar and Bank Account.
- Death certificate of the Member.
- Next of Kin certificate( Legal Heir Certificate)
- Passport photo of the Nominee.
- Minor child birth certificate in case case of member is married and having child.
- Any other relevant documents may asked by the authority at the time of claim submission.
And all the documents need to be attested by the employer where the member used to work before his death.
EPFO Important Circular on EDLI Payment
EPFO head office published an important circular on 18/10/2022 to all the Zonal and Regional offices.
According to the circular, EPFO head office instructed the ZO and RO not to reject EDLI claim saying that the contribution was not received during the period of previous few days and therefore EDLI claim is rejected on account of such NCP days.
EPFO head office further instructed the ZO and RO not to harass the the family member or nominee and complete the verification process within 7 days.
Zonal and Regional offices further requested to ensure that the persons entitled to receive EDLI benefits are not deprived of their rightful claims.
You may download the official notification by click here.
For more information you may visit the official site.
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