Lot of salaried may not know that contribution to EPF is also attached with free insurance coverage called Employee’s Deposit Linked Insurance (EDLI). You may not know because of the low cover it offers. But now your EPF cover opt you minimum Rs.1,32,000 of insurance coverage. Let us see what new changes are done to this.
Below is the table which shows how FPF contribution by you and your employer will be distributed.
Note-Salary for this purpose Basic+DA. This above calculation is considered where employee’s salary is Rs.6,500 or less. But for employees who’s basic salary is more than Rs.6,500, their are different way of calculation. Like few companies contribute equal to employee’s contribution, some maximum of Rs.6,500 whatever employee contribution and in some cases they restriction employee and employer contribution to Rs.6,500 only. So I am not going deep into that.
What is Employees’ Deposit Linked Insurance (EDLI)?
Under this scheme insurance cover is provided to the members of EPF. Cost to this scheme will be borne out by employers but not by employees. As of now the coverage under this scheme is Rs.60,000. Hence lot of employers used to opt out of this scheme due to the less coverage.
But now EPFO allowed Edelweiss Tokio Life-Group Life Protection which covers almost double the existing EDLI covers. Sum Assured covered under this plan is minimum of Rs.1,32,000. But maximum benefit is not mentioned in EPFO circular. All the members of EPFO are eligible to this scheme. Advantage of this scheme is, suppose employer failed to contribute the premium in due period and member dies then employer made responsible. So members need not worry about claim settlement.
Suppose your employer opted for this scheme then they may opt out of EDLI as the benefits under this scheme is higher that the existing EDLI. Hope lot of employers will opt this as an additional benefit to their employees.