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Employees Deposit Linked Insurance Scheme (EDLI Scheme)

By Bhuvana Anand
November 06, 2020

Employees Deposit Linked Insurance Scheme (EDLI Scheme)

EDLI Scheme explained

The Government, in 1976, introduced the EDLI Scheme in order to extend the life insurance benefits to the employees of the private sector. This scheme applies to the establishments that are registered under the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (PF Act) thereby such establishments shall offer the life insurance benefits to its employees, i.e. any organization that has twenty (20) or more employees shall register for EPF, thereby enabling the employees automatically eligible for EDLI Scheme.

This is a beneficial scheme with the object of enabling financial security to the family members (spouse, son up to the age of 25 years, unmarried daughter) of the policyholder.

EDLI protects the insured person completely without any exceptions to the insurance coverage.

The Employer can prefer any other group insurance scheme, provided the benefits offered under such other scheme must be equivalent to, or more than that are offered under the EDLI Scheme.

EDLI Scheme, like the EPF, is transferable during the job change, and the new Employer shall continue to contribute to the existing account.

Contribution and Calculation Matrix

Under the EDLI scheme, Employer makes contributes on behalf of its employees by way of deductions from the salary of its employees.

The contribution of employees is calculated as

For EPF – 12%

For EPS – None

For EDLI – None

The contribution of Employer is calculated as

For EPF – 3.67%

For EPS –8.33% or Rs. 1,250/-

For EDLI – 0.50 or max Rs. 75/-


As per the EDLI (Amendment) Scheme, 2018 dated 21.02.2018:

The Employer’s contribution 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, dearness allowance must be added to the basic salary.

Applicable to all employees with a basic salary under Rs. 15,000/- per month. If the basic wage goes above Rs. 15,000 per month.

The assurance benefit shall not be less than Rs.2,50,000/- and shall not exceed a sum of Rs. 6,00,000/-.

There is a bonus of Rs. 1,50,000/- available under the EDLI.

Therefore, the calculation will be

Average Monthly Salary of the Employee for the last 12 months (capped at 15,000/- p.m.) x 30 + Bonus Amount (Rs. 1,50,000/-)

In the event of policy holder’s (insured person) demise, the registered nominee will receive the lumpsum pay-out.

In case of no nominee being registered, the pay-out amount will be issued to the legal heir subject to the fulfilment of required documentation to that effect.

Documents required to process the pay-out

To claim under EDLI, the deceased policyholder (insured person) should have been an active contributor to the EPF scheme at the time of his / her demise.

The claimant shall submit the following documents

1. Completed Claim Form (Form 5 IF); this form should be signed and certified by the Employer. If the signature of the Employer cannot be obtained, the form shall be duly attested by the (i) Bank Manager in whose branch the account was maintained, or (ii) a Gazetted Officer, or (iii) Member or Secretary or Chairman of the local municipal board, or (iv) local MP or MLA, or (v) Magistrate, or (vi) Member of the EPF regional committee or (vii) Post Master

2. Death Certificate of the policyholder (insured person);

3. In case of no nominee/beneficiary being registered, the legal heir has to provide the Succession Certificate;

4. If the claimant is a minor and if there is no surviving natural guardian, then the guardian of such minor has to provide the Guardianship Certificate to file the claim on behalf of the minor;

5. A copy of cancelled cheque so that the pay-out can be remitted to that account.

  1. The claimant can submit Form 20 (for EPF withdrawal claim) as well as Form 10C/D to claim all the benefits under the three schemes, EPF, EPS and EDLI.

7. Other supporting documents if any.

Upon furnishing the aforesaid documents, within thirty (30) days from the receipt of such claim, the concerned EPF Commissioner shall settle the claim. Any delay in settlement entitles the claimant to interest @ 12% p.a. till the actual date of disbursal.

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