What is the Employees Deposit Linked Insurance (EDLI) Scheme?

About Employees Deposit Linked Insurance (EDLI) Scheme:

EDLI is an insurance scheme that was launched by the Government in 1976.
This scheme was launched with the objective of providing social security benefits to the employees of the private sector for whom such benefits were not commonly provided by the employer.
The EDLI scheme is managed and administered by the Employees Provident Fund Organisation (EPFO), and the scheme provides term life insurance cover on the life of the member employee.
The EDLI scheme covers all organizations registered under the Employees Provident Fund (EPF) and Miscellaneous Provisions Act, 1952.
This scheme works in combination with the EPF and the Employees’ Pension Scheme (EPS).
The extent of the benefit is decided by the last drawn salary of the employee.
The registered nominee of the EDLI scheme receives a lump-sum payment in the event of the death of the EPF member, during the period of the service.
The nominee registered in the EDLI is the same as registered in the EPF Scheme.
Features:
- Maximum assured benefit up to Rs 7 lakh to be paid to the nominee or legal heir of the EPF member if death occurs while in service.
- Minimum assurance benefit is of Rs 2.5 lakh in case the deceased member was in continuous employment for 12 months prior to his or her death.
- This life insurance benefit being given to the EPFO member is free of cost for the PF/EPF account holders.
- Minimal contribution by employer at 0.5% of employee’s monthly wages, up to wage ceiling of Rs 15,000; no contribution made by employee.
- Auto-enrolment of PF members in the EDLI scheme.
- Benefit directly credited to the bank account of legal heir or nominee.

Q1: What is the Employees Provident Fund Organisation (EPFO)?

It is a statutory body under the Employees’ Provident Funds and Miscellaneous Act, 1952. It is under the administrative control of the Union Ministry of Labor and Employment. The Act and Schemes framed there under are administered by a tri-partite Board known as the Central Board of Trustees, Employees’ Provident Fund, consisting of representatives of Government (Both Central and State), Employers, and Employees. The Board administers a contributory provident fund, a pension scheme and an insurance scheme for the workforce engaged in the organized sector in India.

Source: Insurance benefits to stay for EPFO subscribers