If you work in a company and are a member of the Employees Provident Fund (EPF), the Employees Deposit Linked Insurance (EDLI) scheme is an essential social security cover for your family.
Recently, the Employees’ Provident Fund Organization (EPFO) introduced three major changes to this scheme, offering better benefits to employees’ families.
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What is the EDLI Scheme?
The EDLI scheme is a part of the EPF. It provides financial support to an employee’s family in case of the employee’s untimely death during employment.
Key Changes in the EDLI Scheme
Insurance Cover from the First Year of Employment
Earlier, if an employee died within the first year of their job, the family did not receive any insurance benefit.
Now, under the new rule, the family will receive a minimum insurance amount of Rs 50,000. This change is expected to benefit around 5,000 families annually.
Insurance Benefits After Leaving the Job
Previously, if an employee left their job and passed away a few months later, their family did not receive any insurance benefits.
The new rule ensures that if the employee dies within six months of their last EPF contribution, the family will be eligible for the insurance amount, provided the employee’s name hasn’t been completely removed from the company’s roll.
Insurance Cover During Job Changes
Earlier, any break in employment, even for a few days or months, while switching jobs, was not considered “continuous service.”
This could lead to the family losing insurance benefits. Now, if there is a gap of up to two months between jobs, it will still be considered continuous service,
and the family will be eligible for the insurance cover. This change will benefit about 1,000 families every year.
Insurance Cover Amount and Benefits
1) The insurance cover ranges from a minimum of Rs 2.5 lakh to a maximum of Rs 7 lakh.
2) Currently, the EPF offers an interest rate of 8.25% for the financial year 2024-25, as approved by the Central Board of Trustees (CBT).
3) These changes aim to enhance the financial security of employees’ families, potentially benefiting over 14,000 families annually.
The updates in the EDLI scheme provide stronger financial support to employees’ families, ensuring better social security in challenging times.