Deposit linked insurance benefits hiked to Rs 6 lakh

The CBT also recommended removing the condition of continuous employment of one year under current employer before being eligible for insurance benefits.

By: ENS Economic Bureau | New Delhi | Updated: September 17, 2015 9:39 am

Retirement fund manager EPFO has decided to increase the benefits under the Employees’ Deposit Linked Insurance (EDLI) scheme to Rs 6 lakh from the current Rs 3.6 lakh.

The decision was taken at a meeting of the apex decision making body of the Employees Provident Fund Organisation (EPFO) — the Central Board of Trustees — on Wednesday in Hyderabad. “The maximum sum assured under the EDLI scheme have been increased to Rs 6 lakh from Rs 3.6 lakh. This is higher than the original proposal to increase benefits to Rs 5.5 lakh,” said a CBT member after the meeting.

The CBT also recommended removing the condition of continuous employment of one year under current employer before being eligible for insurance benefits.

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“The increased sum assured will benefit four crore contributing members of the EPFO. The approximate amount paid to about 30,000 beneficiaries last year was s 180 crores,” said an official release.

Under existing guidelines, if a subscriber dies after one year of continuous service in the same organisation, the nominee gets 20 times of average wage drawn during the past 12 months, along with a 20 per cent bonus. With the monthly wage ceiling of Rs 15,000 under the scheme, the maximum amount assured works out to be Rs 3.6 lakh.

The original proposal put forward to the CBT sought to increase the sum assured by 30 times to Rs 5.5 lakh. The move is expected to make the scheme more attractive for subscribers and counter the government’s decision to allow workers to opt for private insurance plans instead.

The report of the sub-committee on a low cost housing scheme for EPFO subscribers was also placed before the CBT. “It will be discussed in detail at the next meeting,” said the member.

Meanwhile, labour minister Bandaru Dattatreya also launched an EPF mobile app on Tuesday that would enable subscribers to access their PF details through their smart phones.

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