Friday, May 7, 2021

Employee Deposit Linked Insurance (EDLI) Scheme

If any private sector employee covered by PF has unfortunately passed away while in service in these difficult times, while there may be not much that any employer can do to fill in the loss for their family, however, it may be important for the employer to educate their family and help process the life insurance claim available to such employee under the Employee Deposit Linked Insurance (EDLI) Scheme.


EDLI is an insurance cover provided by the Employees Provident Fund Organisation (EPFO) for private sector salaried employees. The family/nominee of the deceased, who was still in active service at the time of passing away, receives a lump-sum payment as life insurance proceeds from the EPFO in addition to the entire sum from their PF balance.

This scheme was launched in 1976 and applies to all organisations registered under the Employees Provident Fund and Miscellaneous Provisions Act, 1952. These private sector organisations by default contribute as part of the PF contribution under the head EDLI for all employees.

Amount of Insurance Cover

The minimum death cover is Rs. 2.5 lakhs and the maximum cover is Rs. 7 lakhs.

The amount is calculated as:

Avg. Monthly Salary of past 12 months (Basic + DA up to a maximum of Rs. 15000 p.m.) x 35
Add: 50% of Avg. PF Balance in past 12 months (up to a maximum of Rs. 1.75 lakhs)

Thus, the death cover is capped at a total amount of Rs. 7 lakhs.

Documents to be Submitted with EPFO

1. Consolidated Claim Form (for all EPF, EPS and EDLI claims) - Form 5 IF only for EDLI
2. Death Certificate
3. Nominee Form / Nomination Certificate / Guardianship Certificate
4. Proof of Active Service from Employer
5. Cancelled Cheque of Nominee

All documents are to be attested by the employer and submitted manually at the jurisdictional EPFO. Applicants are sending them through Speed Post due to lockdowns in the country.

The claims are supposed to be settled in 30 days.

The Scheme can be read about here. The information has not been updated by the EPFO on their official website yet.