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Kolkata: EPF or Employees' Provident Fund was introduced in 1952 in a young nation with the express purpose of providing financial security to an employee and his/her family members after the expiry of the employee. It offers a lump sum at the time of retirement and a monthly pension to the employee. There is also a third elements in EPFO which is less discussed.
This third element, or benefit, is known as Employees' Deposit Linked Insurance, or EDLI in short. It provides death benefit to the nominee/legal heir of an employee after his/her demise. A lump sum amount is paid to the nominee. The most significant point is that the employee doesn't have to contribute anything for this insurance cover at all.
The amount of insurance paid to the nominee of an employee under EDLI is as follows: The amount will be the average salary drawn by the employee per month in a period of 12 months immediately before the day when the employee expired, subject to a maximum of Rs 15,000. According to a recent EPFO announcement, if an employee dies in the first year of service, his/her family be paid a minimum amount of Rs 50,000. “A minimum life insurance benefit of Rs. 50,000 will be provided in cases where an EPF member dies without completing one year of continuous service. This amendment is expected to result in higher benefits for more than 5,000 cases of deaths in service, every year,” mentioned EPFO in a statement.
In another statement the PFO said that the EDLI benefit will be available even if the EPFO member was not contributing to the EPFO by a period not longer than six months. Earlier the family would not be eligible for the benefit if the employee didn't contribute. “Now, if a member passes away within six months of their last contribution received, the EDLI benefit will be admissible, provided the member’s name is not stuck off from rolls,” said EPFO.
In order to claim EDLI benefit, the nominee of the deceased employee should submit the following documents to the EPFO:
Form 5(IF) filled in properly. It has to be signed by the employer
Death certificate of the employee
Cancelled cheque for bank details to credit the amount
Succession certificate (if the legal heir files claim)
Guardianship certificate (if claim is filed by an adult on behalf of a minor)
