The Employees' Deposit Linked Insurance (EDLI) scheme, managed by the Employees' Provident Fund Organisation (EPFO), provides a life insurance cover of up to ₹7 lakh to eligible beneficiaries. This scheme, established in 1976, is designed to provide financial assistance to the families of private-sector employees in the event of their untimely demise during their service period.

Key Features and Benefits

The EDLI scheme operates in conjunction with the Employees' Provident Fund (EPF) and Employees' Pension Scheme (EPS). Some of the salient features and benefits of the EDLI scheme include:

• Maximum Benefit: The registered nominee or legal heir of a deceased employee is entitled to receive a lump-sum payment, which is capped at ₹7 lakh. This enhancement was made by the EPFO and was effective from April 28, 2021.
• Minimum Payout: The minimum insurance payout under this scheme is ₹2.5 lakh.
• No Employee Contribution: Employees are not required to contribute to the EDLI scheme. The premium is solely borne by the employer, who contributes 0.5% of the employee's basic salary, up to a maximum of ₹75 per month.
• Automatic Enrollment: All employees who are members of the EPF are automatically enrolled in the EDLI scheme.
• Uniform Coverage: The scheme is applicable to all employees drawing a basic salary of up to ₹15,000 per month.
• Comprehensive Coverage: The EDLI scheme provides coverage to employees even if they die while working abroad.
• Independent of Other Insurance Policies: The EDLI coverage is independent and does not interfere with any other personal insurance policies an employee may have.
• Nomination Facility: The insurance benefits can be availed by the family members, legal heirs, or nominees of the member.

Eligibility Criteria

The eligibility criteria for the EDLI scheme are as follows:

• The deceased employee must have been an active member of the EPF scheme. An EPFO member is only covered by the EDLI scheme as long as he/she is an active member of the EPF. His family/heirs/nominees cannot claim it after he leaves service with an EPF registered company.
• The nominee(s) under the EPF scheme are eligible to receive the EDLI benefits.
• In the absence of a nomination, all family members are eligible, with the exception of major sons, married daughters with major sons, and married granddaughters.
• If there is no family or nomination, the legal heir is eligible.
• A guardian can apply on behalf of a minor nominee, family member, or legal heir.

Claim Process

In the event of an employee's death, the nominee or legal heir can claim the EDLI benefits by submitting Form 5IF to the EPFO office, along with the necessary documents. These documents typically include:

• Death certificate
• Guardianship or succession certificate (if applicable)
• Cancelled cheque

Calculation

The payout calculation currently stands as 35 times the average monthly salary (capped at ₹15,000).

Recent Updates

The Central Board of Trustees (CBT) has recently revised the EDLI scheme, increasing the minimum payout to ₹2.5 lakh and the maximum payout to ₹7 lakh. These enhancements aim to provide greater financial security to employees' families.