The Employees’ Deposit Linked Insurance Scheme (EDLI Scheme) is a social security scheme, specifically a term life insurance cover, administered by the Employees' Provident Fund Organisation (EPFO). It was introduced by the Government of India in 1976 to provide a lump-sum payment to the family or nominee of a private sector employee who dies while in service, solving the problem of a lack of financial security for the employee's dependents.
The scheme is connected to the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, and automatically covers all employees who are members of the Employees' Provident Fund (EPF). The mechanism is entirely employer-funded; the employee makes no contribution. The employer contributes 0.50% of the employee's monthly wages (Basic + Dearness Allowance), capped at a maximum wage of ₹15,000, which results in a maximum monthly contribution of ₹75 per employee.
The benefit paid to the nominee is a lump sum, with a minimum assured benefit of ₹2.5 lakh and a maximum benefit of ₹7 lakh. The maximum benefit was increased from ₹6 lakh to ₹7 lakh by an amendment effective from April 28, 2021. A significant recent change, introduced by the Employees' Deposit-Linked Insurance (Amendment) Scheme, 2025, relaxed the eligibility for the minimum benefit by allowing a gap of up to 60 days between two employment spells to be ignored for the 12-month continuous service requirement. Furthermore, the benefit is now payable if an employee dies within 6 months of their last EPF contribution, provided they were still on the employer's rolls. Employers can opt out of the EDLI Scheme under Section 17 of the EPF Act, 1952, only if they provide a group insurance policy with equal or better benefits.