Finance

EPFO EDLI Update 2025: Free Insurance Up to ₹7 Lakhs for PF Account Holders – All You Need to Know

EPFO’s Big Gift: Free Insurance Cover Up to ₹7 Lakhs Under EDLI

The Employees’ Provident Fund Organisation (EPFO) has taken a significant step to strengthen the social security net for working professionals across India. EPFO has increased the maximum insurance benefit to ₹7 lakhs, ensuring that employees’ families are financially protected in case of untimely death during service. Learn the EPFO insurance rules 2025.

🔍 What is the EDLI Scheme?

The EDLI scheme, launched in 1976, is a group life insurance policy governed by EPFO.

Its primary goal is to provide a financial safety net to the family of an employee in the unfortunate event of their demise while actively employed.

Coverage: No separate registration is required. All employees with an active PF account are automatically covered.
No Premium: Employees don’t pay a single rupee. Employers contribute 0.5% of the basic salary, capped at ₹75/month.

📈 What’s New in 2025?

Here’s what the revised EDLI rules bring to the table:

1. Insurance Amount Increased

Old Coverage: ₹2.5 lakh (Maximum)
New Coverage: Up to ₹7 lakh
Calculation Basis: Based on average monthly salary of the last 12 months before death, including dearness allowance.

2. Insurance Even Within First Year of Joining

Previously, employees who passed away within a year of joining weren’t eligible for the insurance benefit. The new rule now grants a minimum coverage of ₹50,000, even in such early-stage employment cases.

3. Coverage Continues After Job Change

Employees frequently face a 2-month gap between changing jobs and now the new EDLI rule allows coverage to continue despite the break, offering uninterrupted insurance protection.

Eligibility EPFO insurance rules 2025 Criteria & Process for Claim

Who Can Claim?

Nominee as registered in EPF account
Legal heirs, in absence of a nominee

Required Documents

Death Certificate of the employee
Identity and address proof of claimant
Bank account details
Form 5IF (for EDLI claim)

How to Claim?

Visit the EPFO office or apply online via UMANG App.
Submit Form 5IF along with the required documents.
The claim is processed after verification and funds are transferred directly.

Why This Change Matters?

Over 1,000 employee deaths are reported annually during active employment.
This scheme revision ensures financial assistance to families without burdening employees.
It strengthens India’s employee welfare infrastructure, reducing dependency and uncertainty.

Social Security with UAN Integration

The Universal Account Number (UAN) plays a crucial role in enabling seamless insurance claims and tracking of benefits. The UAN acts as a central ID for managing multiple PF accounts across jobs, ensuring continuity of benefits like EDLI and simplifying the withdrawal and transfer process.

Final Thoughts: A Big Leap Toward Employee Security

The 2025 update to EPFO’s EDLI scheme reflects the government’s commitment to employee welfare and family protection. With a non-contributory, high-value life insurance cover, EPFO provides PF account holders with more than just retirement savings — it ensures peace of mind for their families too.