In a significant development for Provident Fund subscribers, the Employees’ Provident Fund Organisation (EPFO) has announced major changes to its Employee Deposit Linked Insurance (EDLI) scheme. These updates come as part of efforts to strengthen the social security net for employees and their families in India.
The new rules make the death claim process easier and enhance the insurance benefits available to EPF account holders, ensuring wider and more inclusive coverage.
The Employee Deposit Linked Insurance (EDLI) scheme was launched in 1976 with the goal of providing financial protection to the families of EPF members in case of untimely death during service. Under this scheme, the legal heir or nominee of a deceased employee can claim a lump-sum insurance amount, with no cost to the employee.
Unlike traditional life insurance policies, employees are not required to pay any premium. The employer contributes 0.5% of the basic salary towards the EDLI scheme.
Previously, the insurance coverage under the EDLI scheme was capped at ₹2.5 lakh. As per the new rules, the maximum insurance benefit has been raised to ₹7 lakh. The amount is determined based on the average basic salary of the employee over the last 12 months.
Earlier, if an employee died within a year of joining the organization, no insurance was paid. Now, even if an employee dies within the first year of service, the nominee will receive a minimum of ₹50,000 as insurance.
Employees often worry about losing insurance benefits while transitioning between jobs. The revised EDLI rules provide relief—if an employee changes jobs and has a gap of up to two months, the insurance coverage will continue uninterrupted. This ensures continuous financial protection for the employee’s family.
In the event of the death of an employee while still in service:
The nominee or legal heir must file a claim.
The insurance amount payable ranges between ₹2.5 lakh to ₹7 lakh, based on the employee's last 12 months’ salary.
No premium is required from the employee’s side.
Claims can be submitted through the EPFO regional office, often with the assistance of the employer.
These changes are expected to positively impact thousands of families each year. According to EPFO estimates, over 1,000 employment-related deaths occur annually, and the updated EDLI scheme will provide much-needed financial support to the affected families.
The enhancement of EDLI benefits signals a significant step toward strengthening the social safety net for salaried individuals in India. The EPF system is no longer just a retirement savings tool—it’s a comprehensive protection mechanism that covers employees through various stages of life, including in emergencies.
With no premium burden and higher payouts, the EDLI scheme now serves as one of the most valuable no-cost insurance covers available to salaried individuals in India.
The EPFO’s new rules for the EDLI scheme in 2025 represent a welcome relief for millions of Indian workers. With free insurance coverage up to ₹7 lakh, simplified claim procedures, and continuous protection even during job changes, the scheme now offers stronger, smarter, and more inclusive financial security.
If you're an EPF account holder, ensure your nominee details are up to date to avail of this benefit. For more updates and guidance, visit the official EPFO website.
