Quick Summary
EDLI — Employees’ Deposit Linked Insurance — is a statutory life-cover scheme run by the EPFO under the Employees’ Provident Funds & Miscellaneous Provisions Act, 1952. Every employee enrolled in EPF is automatically covered. The employer contributes 0.5% of monthly wages (calculated on the wage ceiling, currently ₹15,000, so roughly ₹75 per employee per month); the employee pays nothing.
EDLI vs Group Term Life
- Statutory vs voluntary: EDLI is a mandatory EPFO benefit tied to wages, whereas Group Term Life (GTL) is a policy an employer chooses to buy, with a sum assured it sets (often a multiple of salary).
- Benefit amount: The EDLI assurance benefit is capped by EPFO rules; a GTL policy can offer a substantially higher, employer-defined cover.
- Opt-out route: Under Section 17(2A), an employer that provides a superior group life policy can seek exemption from EDLI — a common reason employers layer GTL on top.
Best Practice for HR Teams
Ensure every employee’s EPF nominee details are current, since EDLI proceeds are paid to the registered nominee, and treat GTL as a top-up over the statutory EDLI floor.
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