EPFO Insurance Rules: If you’re employed, you likely have a PF account. PF is an account that provides savings for retirement. Many people link it to their pension. It’s worth noting that the EPFO offers a special benefit to PF account holders, but most people aren’t aware of this. In fact, the EPFO provides free insurance of ₹7 lakh to PF account holders. This insurance is provided without any additional cost. People automatically receive this benefit, but people aren’t aware of it.
Life cover comes with your PF account
This benefit from the EPFO is provided under EDLI. This means that if you deposit money into the EPF, you’re automatically covered by this insurance. EDLI is considered the third-largest benefit after EPS and EPF. The main reason for this is that it’s available without any premium. There’s no form to fill out or registration required.
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Employees don’t have to spend any money
The most important feature of this insurance is that employees don’t have to pay any premiums. The company bears the entire cost. The company contributes 0.5% of the employee’s salary to the EDLI scheme every month. This deduction is not made from the employee’s salary. Therefore, all employees with PF can avail themselves of this insurance without any expense.
Learn when employees receive assistance
This insurance benefit is available only if the employee dies while on the job. Whether the incident occurred in the office or at home on leave, the insurance benefit is still available. In such cases, financial assistance is provided to the employee’s family or nominee to provide support during difficult times.
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How much benefit is available?
The amount received under EDLI is divided into two parts. The minimum cover is ₹2.5 lakh, and the maximum cover is ₹7 lakh. The insurance amount is determined based on the employee’s salary and PF balance over the past 12 months. This means that the higher the fixed salary and PF balance, the greater the insurance cover.
