EPFO raises deposit linked insurance benefits to Rs 7 lakh; here’s what it means for you

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EPFO raises deposit linked insurance benefits to Rs 7 lakh; here’s what it means for you

The Employees’ Provident Fund Organisation (EPFO) on Wednesday hiked the maximum assurance benefit to up to Rs 7 lakh from the existing Rs 6 lakh under the Employees’ Deposit Linked Insurance (EDLI) scheme. This scheme is a mandatory insurance cover provided to all subscribers of EPF scheme.

Under EDLI, the registered nominee receives a lump-sum payment in the event of the death of the person insured, during the period of the service. However, the claim amount depends on the salary drawn in the last 12 months of the employment of the deceased (this will be subject to a maximum of Rs 7 lakh now).

The new amendment to the scheme will provide additional succour to families and dependents of members of the scheme in case of their unfortunate death while in service, according to experts.

The Central Board of Trustees (CBT) was  also informed on Wednesday that the actuarial valuation of EDLI Fund has allowed for continuation of minimum assurance benefit of Rs 2.5 lakh beyond February 14, 2020, and extension of minimum assurance benefit of Rs 2.5 lakh to the family of those deceased members who were employed in multiple establishments during the 12 months preceding the month in which they died.

This benefit was previously not available if the member worked in more than one organisation during a continuous period of 12 months preceding his death.

Additionally, the EPFO on Wednesday decided to provide 8.5 percent rate of interest on employees’ provident fund(EPF) for 2019-20. In March this year, EPFO’s apex decision making body Central Board of Trustees headed by Labour Minister Santosh Gangwar had approved 8.5 percent interest rate on EPF for last fiscal.