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EPFO Set To Hike Maximum Insurance Limit to Rs 5.50 Lakh
- DetailsWritten by PolicyBazaar -
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Modified 03 November 2015
The Employees Provident Fund Organization (EPFO) is likely to increase the maximum insurance limit to Rs 5.50 lakh from the existing Rs 3.60 lakhs under its Employees' Deposit-linked Insurance (EDLI) scheme.
As per the existing rules, if a subscriber passes away after one year of continuous employment in the same company, the nominee receives 20 times the average wage drawn during the last 12 months, along with 20% bonus. With the current wage ceiling being Rs 15,000, the maximum sum assured available to the nominee is Rs 3.60 lakhs. However, once the proposal is approved, the maximum sum assured will increase to Rs 5.50 lakhs.
The proposal also seeks to simplify insurance norms for subscribers with less than 12 months of service. In the existing rules, subscribers with less than 12 months of service are entitled to a maximum sum assured of Rs 1.20 lakhs. This sum assured is equal to the average balance in the provident fund account if it is lower than Rs 50,000. In case the amount is more than Rs 50,000, subscribers are entitled to get the same amount along with 40% of the amount above Rs 50,000, subject to a maximum ceiling of Rs 1 lakh. They also get 20% bonus over the due amount.
In another development, Mr. Bandaru Dattatreya, Labour Minister, has said that the EPFO is further simplifying its forms to offer hassle-free service to its subscribers. It is proposed that attestation of employees will no longer be required if employees have got their KYC, including Aadhaar, done and have activated their UAN (Universal Account Number).
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