Does the EDLI scheme cover deaths after employment ends? Know Details

In workplaces across India, the Employees' Deposit Linked Insurance (EDLI) Scheme acts as a crucial safety net, offering financial protection to the families of employees in the event of their unfortunate adn untimely demise.

The scheme, administered by the Employees' Provident Fund Organization (EPFO), is designed to provide insurance coverage to employees working in organisations covered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952.

But will family members of beneficiaries be able to get EDLI insurance if the employee dies while not active in their service? Before knowng its answers let’s explore the EDLI topic more.

Coverage and Benefits

Under the EDLI Scheme, the insurance amount is linked to the employee's Provident Fund (PF) contributions. Currently, the scheme provides an insurance benefit of up to Rs 7 lakh. This amount is disbursed as a lump sum to the nominee or legal heir of the deceased employee.

The scheme's benefits are crucial in providing financial stability to the dependents of employees who pass away during their active service. It serves as a form of social security, ensuring that families are not left financially vulnerable in the aftermath of a tragic loss.

Limitations and Eligibility
Despite its importance, the EDLI Scheme has specific limitations that potential beneficiaries must be aware of. One of the primary criteria for eligibility is that the death of the employee must occur while they are still in active service. This means that if an employee dies after leaving their place of work, their family may not be eligible to claim benefits under the scheme.