Employees Deposit Linked Insurance Scheme or EDLI is an insurance cover provided by the EPFO (Employees Provident Fund Organisation) for private sector salaried employees. The registered nominee receives a lump-sum payment in the event of the death of the person insured, during the period of the service. EDLI applies to all organisations registered under the Employees Provident Fund and Miscellaneous Provisions Act, 1952. All such organisations must subscribe to this scheme and offer life insurance benefits to their employees. This scheme works in combination with EPF and EPS. The extent of the benefit is decided by the last drawn salary of the employee.
- EDLI applies to all employees with a basic salary under Rs. 15,000/- per month. If the basic salary goes above Rs. 15,000 per month, the maximum benefit is capped at Rs. 6,00,000/-. With effect from 28.04.2021, the EPFO has increased the maximum benefit to Rs.7 lakh.
- There is no need for the employees to contribute to EDLI. Their contribution is required only for EPF.
- There is a bonus of Rs. 1,50,000/- available under the EDLI. With effect from 28.04.2021, the bonus is increased to Rs.2.5 lakh.
- The Ministry had increased the minimum amount of benefit to Rs.2.5 lakh in Feb 2018, which was valid for two years. The EPFO has extended this minimum amount of Rs.2.5 lakh with retrospective effect from 15th Feb 2020.
- Any organisation that has more than 20 employees needs to register for EPF. Therefore, any employee who has an EPF account automatically becomes eligible for the EDLI scheme.
- There are no exceptions to the insurance coverage provided by EDLI. It protects the insured person round the clock, all around the world.
- An employer can opt for another group insurance scheme, but the benefits offered must be equal to or more than those offered under EDLI.
- As per the provisions of the EDLI, the contribution of an employer must be 0.5% of the basic salary or a maximum of Rs. 75 per employee per month. If there is no other group insurance scheme, the maximum contribution is capped at Rs. 15,000/- per month.
- For all calculations under EDLI, the dearness allowance must be added to the basic salary.
Administration of the Schemes