The Ministry of Finance has issued a new Master Circular on February 17, 2026, to simplify how the Central Government Employees Group Insurance Scheme (CGEGIS), 1980 is managed.
The benefits of the scheme remain the same.
However, the government has now combined decades of old instructions into one single, updated document.
The aim is to make accounting clearer, more uniform, and easier to follow.
For central government employees, this could mean smoother record-keeping and faster claim processing.
One Rulebook Instead of Many
Earlier, departments had to refer to multiple orders issued over the years — from 1981 onwards — to understand how CGEGIS accounting worked.
Now, all those amendments have been consolidated into one master circular.
This reduces confusion and ensures every department follows the same updated instructions.
The circular was issued by the Controller General of Accounts (CGA) to make the system simpler for all stakeholders.
No Individual Accounts — Here’s What It Means
One major clarification in the circular is that there will be no individual accounting under the scheme.
Instead, all transactions will be recorded under a specific head in the Public Account of India:
8011 – Insurance and Pension Funds
Central Government Employees’ Group Insurance Scheme
Insurance Fund
Savings Fund
The scheme will continue to operate under two parts: the Insurance Fund and the Savings Fund.
This separation ensures transparency in how money is collected and paid out.
Salary Deductions and Reporting
Employees’ monthly contributions will continue as before.
Drawing and Disbursing Officers (DDOs) must clearly show the total subscription recovered in salary bills under the specified accounting head.
Every January, DDOs must submit detailed schedules.
These will help Pay & Accounts Offices (PAOs) prepare annual reports.
For employees, this means deductions remain the same — but documentation will now follow a more streamlined system.
Faster Settlement of Claims
The circular places special emphasis on quick claim processing, especially in case of death of a member.
PAOs have been directed to pass claim bills expeditiously.
Payments must clearly show amounts from both the Insurance Fund and the Savings Fund.
Service books, including nomination details, must be sent along with claim bills to avoid delays.
This is particularly important for families, as it aims to ensure faster and more accurate settlement of benefits.
What About Transfers and Deputation?
If an employee is transferred to another ministry or department, the transfer order must clearly mention their CGEGIS group and membership period.
The new DDO can start deducting subscriptions only after verifying earlier deductions.
This prevents gaps or double deductions.
For employees on deputation to state governments, Union Territories, or foreign service, contributions will continue to be monitored by the parent department’s Accounts Officer.
This ensures uninterrupted coverage under the scheme.
Interest on Savings Fund
The total subscription is divided between the Insurance Fund and the Savings Fund in fixed proportions.
After adjusting quarterly payments, the balance in each fund earns interest.
The interest rate will be the one notified by the Ministry of Finance.
Interest will be credited quarterly and reflected in government accounts the following month.
For employees, this means the Savings Fund portion will continue to grow with notified interest, forming part of the final payout.
What Does Not Change
It is important to note that the circular does not change:
Subscription rates
Eligibility rules
Insurance benefits
Savings Fund benefits
Employees will continue to contribute monthly based on their pay level and receive benefits as per existing rules.
Why This Matters
Although the scheme itself remains unchanged, the new accounting framework is significant.
By bringing all instructions under one document, the government aims to improve transparency, reduce confusion, and make fund management more efficient.
For central government employees, this should lead to clearer tracking of contributions, better documentation, and faster processing of claims — especially in critical situations.
