Employee Provident Fund Organisation Life Insurance

What is PF Life Insurance?

The Employees' Provident Fund Organisation (EPFO) provides a life insurance benefit under the Employee Deposit Linked Insurance (EDLI) Scheme. It offers financial support to the family (nominee/legal heir) of a member in case of their death while in service.

Key Features of EPFO Life Insurance (EDLI Scheme)

• Eligibility : All EPF Members
• Coverage : Death during the active service
• Employer : 0.5% of basic wages (max Rs. 75/month)
• No contribution required from employee
• Insurance Amount : Upto Rs. 7 Lakhs
• Minimum Benefit : Rs. 2.5 Lakhs (if member was in continuous service for last 12 months or more)
• Linked with EPF Account (no separate policy required)

Calculation of EDLI Payout:

Based on the average monthly salary (Basic + DA) of the last 12 months.

Formula:

Insurance amount = 35 × average monthly salary (subject to Rs. 15,000 max) + bonus of Rs. 1.75 lakh

Maximum payout:
Rs. 5.25 lakh (35 × Rs. 15,000) + Rs. 1.75 lakh = Rs. 7 lakh

Claim process of EDLI scheme:

1. Form Submission:
   • Submit Form 5IF (EDLI claim form)
   • Death certificate
   • Nominee's identity and bank details
   • PAN and Aadhar (KYC)
2. Where to Submit:
   • At the EPFO office through the employer
   • Or directly if the employer is unavailable
3. Time Limit:
   • Better to claim within 12 months of the death

Benefits of EDLI Scheme:

• No premium payment from employees
• Automatically covered with EPF
• Covers all causes of death (including natural causes and accidents)
• Easy to claim for nominee

Please note, Under Section 17 (2A) of the Employees' Provident Fund and Miscellaneous Provisions Act 1952, an employer can stop contributing to the EDLI scheme if they opt for a better employee insurance policy under a different scheme.