 "EPFO raises maximum insurance cover to Rs 6 lakh")
Retirement body Employees Provident Fund Organisation (EPFO) on Wednesday substantially increased the maximum amount assured under its Employees' Deposit Linked Insurance Scheme (EDLI) to Rs 6 lakh from the existing Rs 3.6 lakh.
The decision, taken at the 208th Central Board of Trustees (CBT) meeting in Hyderabad, will benefit 40 million contributing members of the EPFO.
"In a major decision, the Central Board of Trustees under the chairmanship of Bandaru Dattatreya, Union Minister for Labour & Employment enhanced the insurance benefits under the Employees Deposit Linked Insurance Scheme 1976 admissible to dependants of EPF members from the present maximum of Rs 360,000 to Rs 600,000.This will benefit 4 crore EPF contributing members," said a press statement from the Union labour ministry.
The release mentioned last year the government paid around Rs 180 crore to about 30,000 beneficiaries.
In another major relief, the trustees also decided to remove the condition of continuous employment of one year under current employer before being eligible for insurance benefits.
At present, only subscribers who have worked for one year continuously in the same organisation is eligible for the insurance cover. The nominee of the subscriber gets 20 times of average wage drawn during the past 12 months with 20% bonus on it. This means, on a wage ceiling of Rs 15,000 every month, the maximum amount assured works out to be Rs 3.6 lakh.
The trustees approved an incentive scheme for employers to seed Universal Account Number (UAN) with Know Your Customer (KYC) documents.
For instance, an employer can claim 10% refund of administrative charges paid during the quarter if the establishment provides Aadhar card details of 80% employees, bank details of all the employees and PAN card detail wherever applicable. This will become operational from October 1 for one year.
At present, employers pay 0.65% of employees' monthly basic salary towards administrative fee.