Millions of employees across India are covered under an EPFO insurance scheme, but many are unaware of it.
If your Provident Fund (PF) is deducted from your salary, you may already have a free life insurance cover of up to ₹7 lakh.
The best part is that you don’t have to pay any premium for this benefit.
This insurance is provided by the Employees’ Provident Fund Organisation (EPFO) under the Employees’ Deposit Linked Insurance (EDLI) Scheme.
It acts as a financial safety net for families during difficult times.
What Is the EDLI Scheme?
The Employees’ Deposit Linked Insurance (EDLI) Scheme was introduced in 1976 to provide financial protection to PF account holders and their families.
Unlike regular insurance policies, employees do not pay any premium for this cover.
The entire cost is borne by the employer.
Under the scheme, employers contribute 0.50% of an employee’s Basic Salary and Dearness Allowance (DA) towards the insurance fund.
If an EPFO member dies while in service, the nominee can receive an insurance payout ranging from ₹2.5 lakh to ₹7 lakh, depending on eligibility.
Who Can Get the Benefit?
The scheme applies to employees who are EPFO members and have an active PF account.
One important condition is that the employee should have been employed continuously during the 12 months before their death.
Even if they changed jobs during this period, they can still remain eligible as long as their PF account stayed active.
However, the benefit is available only if the employee passes away while still in service.
How Can the Family Claim the Insurance Amount?
In the unfortunate event of an employee’s death, the nominee can apply for the insurance claim.
To do this, Form 5 IF must be submitted to the EPFO office along with necessary documents such as:
Death certificate of the employee
Succession certificate (if required)
Bank account details of the nominee
Other supporting documents requested by EPFO
Once the claim is verified, the eligible insurance amount is paid to the nominee.
Why Updating Your Nominee Is Important
Many families face delays in receiving benefits because nominee details are not updated.
EPFO advises all members to complete their e-nomination through the UAN portal.
Keeping nominee information updated ensures that family members can easily claim the insurance amount when needed.
More Than Just a Retirement Savings Account
Most people think of PF only as a retirement savings fund.
However, the EPFO also provides valuable insurance protection through the EDLI scheme at no extra cost to employees.
This little-known benefit can provide crucial financial support to a family during a crisis, making it one of the most important advantages of being an EPFO member.
