InvestorQ : What is EDLI(Employees’ Deposit Linked Insurance), and how is it beneficial for me?
ramya Bhaskaran made post

What is EDLI(Employees’ Deposit Linked Insurance), and how is it beneficial for me?

swati Bakhda answered.
1 year ago
EDLI stands for Employees’ Deposit Linked Insurance. This plan provides income security to the family of a private sector employee after his death. The scheme was introduced in 1976 to cover all the active members of the employees’ provident fund. It is an insurance product providing a death benefit to the EPFO employees. The minimum death cover under the said scheme has been increased to Rs 2,50,000 effective from February 2020. Also, the maximum benefit has been increased by Rs 1,00,000 from Rs 6,00,000 to Rs 7,00,000. These limits shall remain effective for three years.

For availing of the benefit of this scheme, employees need not contribute any amount as the scheme is supported by a nominal contribution from the employer.

Now, the question arises, why you had not heard about such a scheme in your organization? Well, that is mainly because your organization has opted out of the EDLI scheme, as EPFO allows some organizations to withdraw from the scheme. If your company has chosen any better life insurance product from other insurers, in that case, it does not need to contribute to EDLI.


In the unfortunate event of death, the death benefit that your family could under the scheme varies from Rs 2.5 lakhs to Rs 7 lakhs, depending upon the contribution made by your employer. The benefit is based on monthly wages (basic + dearness allowance), with a cap on monthly wages at Rs 15,000, and is calculated using the average formula. 

It has been said that one should take an insurance plan with a cover-up to 10 times the annual income. Whereas money is money, and financial help in tough times could come in handy, no matter what. Also, you do not have to make a contribution to the insurance plan, so you could utilize that money to invest in other insurance products/investments.