The Employees’ Deposit Linked Insurance (EDLI) scheme provides free insurance coverage to employees, with a maximum benefit of ₹7 lakhs.
Many people are aware of their Provident Fund (PF) and pension schemes, but the EDLI scheme is often overlooked.
The insurance under this scheme is funded by the company, which contributes 0.50% of the employee’s basic salary and dearness allowance (DA). The amount of the insurance claim is calculated using a specific formula.
Insurance Claim Calculation and Bonus
The insurance amount is based on the employee’s basic salary and DA over the last 12 months. The claim amount is calculated as 35 times the last drawn basic salary plus DA, with an additional bonus of up to ₹1,75,000.
If an EPF subscriber passes away, their nominee or legal heir can claim this insurance. The nominee must be at least 18 years old; if younger, a guardian can make the claim.
Required documents include the death certificate, succession certificate, and, if applicable, a guardianship certificate and bank details.
Who is Eligible to Claim?
The EDLI scheme covers EPFO members only while they are employed. After leaving a job, the nominee or family heirs cannot make a claim.
However, if the EPFO member has worked continuously for 12 months, the nominee is entitled to a minimum benefit of ₹2.5 lakhs after the employee’s death.
This benefit is available in case of death due to illness, accident, or natural causes while on the job.
