There are so many schemes that are run by the central government. In today’s article, we are going to discuss one about it. Today we are going to tell you about the EDLI Scheme. Free insurance coverage is provided by the EPFO on every EPF account. That is, if an employee dies during the job, then his nominee can get financial assistance of up to 7 lakh under this scheme.
What is the EDLI scheme?
If the EPF account holder has not made anyone a nominee, then his legal heirs get the insurance amount equally.
EPFO members are covered as per the Employees’ Deposit Linked Insurance Scheme, i.e., EDLI 1976. Insurance cover can be available in case of illness, accident, or natural death of the employee. Let us tell you that this insurance amount depends on the salary of the last 12 months, and every month, 8.33 percent of the PF amount deposited from the employee’s salary is deposited in EPS, 3.67 percent in EPF, and 0.5 percent in the EDLI scheme. Nomination is important.
It is imperative that you enter the nominee’s name in your account. If an account holder dies, then his family does not face any difficulty in taking advantage of EPF, EPS, and EDLI schemes. For your information, let you know that if the EPF account holder dies suddenly, then his nominee or legal heir can claim for insurance cover, but for this, the nominee should be at least 18 years old.
If you are younger than this, the guardian can claim on his behalf. Documents such as a death certificate and a succession certificate are required while making a claim. If the claim is being made on behalf of the guardian of the minor nominee, then a guardianship certificate and bank details will have to be given. The EDLI is applicable to all employees with a lower basic salary of Rs 15,000 per month. According to this, there is no need for employees to contribute to EDALI. Any organization with more than 20 employees needs to register for EPF.
Therefore, the employee who has an EPF account automatically becomes eligible for the EDLI scheme. An employer can opt for any other group insurance plan, but the benefits offered must be equal to or greater than the benefits offered under EDLI. Let us tell you that the sum insured depends on the basic salary and DA of the last 12 months, and the claim of insurance cover will be 35 times the last basic salary + DA. Along with this, a bonus amount of up to $1,75,000 is also paid to the claimant.
The EDLI scheme gives free insurance coverage to the family members of an employee in the event of death during the active service period. Once all the documents are provided and the claim for insurance is accepted, the EPF settles the claim within 30 days of receipt of the claim to the commissioner. The claimant is entitled to interest at the rate of 12% per annum.
