EPFO DELI SCHEME 1976. Know all about it here




EPFO DELI SCHEME 1976: EPFO is one of the largest Social Security Organizations administers three schemes – Employees’ Provident Fund (EPF) Scheme 1952, Employees’ Pension Scheme (EPS) 1995 and Employees’ Deposit Linked Insurance (EDLI) Scheme 1976. Click here to know more about EPFO’s Schemes .

EPFO DELI SCHEME 1976

Understanding the EPFO Deposit Linked Insurance (DLI) Scheme 1976

The Employees’ Provident Fund Organization (EPFO) Deposit Linked Insurance (DLI) Scheme 1976 is a unique initiative designed to offer financial security to the families of employees in the event of their untimely demise. This scheme, implemented under the broader umbrella of the Employees’ Deposit Linked Insurance Scheme, aims to provide life insurance benefits without requiring any direct contribution from the employees. It is an important component of the social security measures for employees in India.

In this blog post, we’ll dive deep into the features, benefits, eligibility criteria, and application process of the scheme to help you understand its relevance and importance.

EPFO DELI SCHEME 1976
EPFO DELI SCHEME 1976

EPFO DELI SCHEME 1976 What is the EPFO DLI Scheme?

The DLI Scheme is a group insurance scheme introduced in 1976 under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. It ensures that the family members of an employee who passes away during their service period receive a lump sum amount as insurance.

The scheme is directly linked to the employee’s last drawn salary, making it a unique benefit for salaried individuals. It provides financial assistance to the employee’s family at a time when they need it the most.

Key Features of the DLI Scheme

1. No Employee Contribution
One of the most attractive aspects of the DLI Scheme is that it does not require any contribution from the employees. This benefit comes entirely from the employer’s contributions.

2. Employer’s Contribution
The employer contributes 0.5% of the employee’s monthly salary (including basic pay and dearness allowance) towards the insurance premium under this scheme. This contribution is made on behalf of the employee and is separate from EPF and EPS contributions.

3. Insurance Coverage

The scheme provides life insurance coverage to all employees who are members of the EPF.

The insurance amount is calculated based on the employee’s last drawn salary and their period of service.

4. Automatic Enrollment
Employees who are enrolled in the EPF scheme are automatically eligible for the DLI scheme. No separate registration is required.

5. Lump Sum Payment
In case of the death of an employee, the nominee or legal heir receives a lump sum payment based on the insurance amount eligible under the scheme.

Benefits of the DLI Scheme

1. Financial Security for Families
The primary benefit of the scheme is to provide financial security to the employee’s family after their untimely demise. This insurance ensures that the family has immediate financial support during a challenging time.

2. No Additional Cost for Employees
Employees do not need to pay any premium or make any contribution to avail of the benefits of this scheme. The employer bears the cost entirely.

3. Substantial Coverage
The insurance amount can go up to ₹7 lakh, depending on the employee’s last drawn salary and tenure. This is a significant amount for many families.

4. Simplified Claim Process
The claim process for the DLI Scheme is straightforward, ensuring that the nominee receives the benefits without unnecessary delays.

5. Part of a Larger Social Security Network
Along with the EPF and EPS (Employees’ Pension Scheme), the DLI Scheme forms a robust social security framework for employees, providing them with comprehensive benefits during and after their service.

EPFO DELI SCHEME 1976 Eligibility Criteria for the DLI Scheme

To be eligible for the DLI Scheme, the following conditions must be met:

1. EPF Membership
The employee must be a member of the Employees’ Provident Fund (EPF) at the time of their demise.

2. Active Employment
The scheme is applicable only to employees who are actively employed and contributing to the EPF.

3. Employer’s Contribution
The employer must be making the necessary contributions towards the DLI Scheme on behalf of the employee.

How is the Insurance Amount Calculated?

The insurance amount under the DLI Scheme is directly linked to the last drawn salary of the employee. The calculation is as follows:

1. Basic Insurance Amount
The nominee is entitled to 35 times the employee’s last drawn monthly salary (basic pay + dearness allowance).

2. Bonus Amount
An additional bonus amount of ₹2.5 lakh is provided under the scheme. This bonus amount is fixed and not linked to the salary.

For example, if an employee’s last drawn monthly salary is ₹15,000, the insurance amount will be calculated as follows:

Basic Insurance: 35 × ₹15,000 = ₹5,25,000

Bonus: ₹2,50,000

Total Insurance Amount: ₹5,25,000 + ₹2,50,000 = ₹7,75,000

In this case, the nominee will receive ₹7.75 lakh as the insurance benefit.

How to Claim the DLI Scheme Benefits?

If an employee passes away during their service, the nominee or legal heir can claim the benefits of the DLI Scheme by following these steps:

1. Collect Required Documents
The nominee must gather the following documents:

Death certificate of the employee

Employee’s EPF account details

Proof of nominee’s identity (e.g., Aadhaar card, PAN card)

Bank account details of the nominee

2. Submit the Claim Form
The nominee needs to fill out and submit Form 5(IF), which is specifically designed for claiming insurance benefits under the DLI Scheme.

3. Employer Verification
The employer must verify and attest the claim form before it is submitted to the EPFO.

4. Submit to EPFO
The completed claim form, along with the required documents, must be submitted to the regional EPFO office.

5. Claim Processing
Once the claim is submitted, the EPFO processes it and disburses the insurance amount directly to the nominee’s bank account.

EPFO DELI SCHEME 1976

Common Questions About the DLI Scheme

1. Can an employee opt out of the DLI Scheme?
No, the scheme is mandatory for all EPF members. It is automatically applicable as long as the employer is contributing to the EPF on behalf of the employee.

2. Is there any tax implication on the insurance payout?
No, the insurance payout received under the DLI Scheme is tax-free as per the prevailing income tax laws in India.

3. What happens if there is no nominee?
In the absence of a nominee, the legal heir of the deceased employee can claim the benefits.

4. Can retirees claim the benefits?
No, the scheme is applicable only to employees who are actively employed and contributing to the EPF.

Conclusion

The EPFO Deposit Linked Insurance (DLI) Scheme 1976 is a vital safety net for employees and their families. It provides life insurance coverage without requiring any financial contribution from the employee, ensuring that their loved ones are financially supported during unforeseen circumstances.

By offering substantial coverage, seamless processes, and comprehensive benefits, the DLI Scheme forms a critical part of India’s social security system. Employees should ensure that their EPF accounts are updated with correct details, including nominee information, to make the most of this invaluable benefit. Employers, on the other hand, must comply with their responsibilities to ensure all eligible employees are covered.

For employees and their families, understanding the DLI Scheme is crucial to appreciating its value and ensuring that it serves its intended purpose of financial security during difficult times.

Information Note:

If You Want Help for The Employees Provident Fund Organization, They Can Comment Down Your Questions and Problems Below on epfoadvise.co.in, Or If You Want Any Information from Our Team Then Also Comment Below.

Disclaimer:

Kindly note that this site is not the official website of the EPFO organization. We provide information available from the internet on and the information available on epfoadvise.co.in may vary to the actual information. We collect information online from different resources including the official website of the EPFO organization.

If you find any information wrong or corrections needs to do, you are requested to kindly contact us.

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