Page 152 - Group Insurance and Retirement Benefit IC 83 E- Book

ACCIDENT BENEFIT:

Double accident benefit can be allowed to the extent of the Sum Assured for an extra
Premium.

STEPS TO INTRODUCE THE SCHEME:

Put up notice for the knowledge of the employees that you are going in for LIC's Scheme
in lieu of EDLI.

Apply to the Regional Provident Fund Commissioner under Sec.17 (2A) of the E.P.F. and

M.P. Act 1952 to exempt you from EDLI Scheme. The application should be
accompanied by the prescribed requirements including the Rules of the Proposed Group

Insurance scheme.

All employers who are having 20 or more employees are covered under the Provident
Fund and Miscellaneous Provisions Act of 1952.

They have to compulsorily deduct 12% of the salary (Basic+DA) of the employees

working under them and also to contribute 12% of the salary (Basic+DA) as employer‘s
contribution and remit both the amounts to the Provident Fund Authorities every month.

The 12% is to be deducted subject to ceiling on salary of 6500. Out of this amount, an

amount of 8.33% out of the employer‘s contribution of 12% is transferred to a pension
fund account. From this Pension Fund the employees are assured of a pension depending

on the accumulation in their account. The remaining amount of the employer‘s
contribution along with the employee‘s contribution is invested as per the norms

prescribed by the Government, and interest is credited to the employee‘s PF account.
This balance amount to his credit will be paid to him in case of his resignation or

retirement. However in case of death while in service, the payment of contribution will

cease and only the accumulated balance standing to his credit at the time of death will
become payable to his family. If this happens in the early part of his employment, the

amount would be meager.

In order to supplement the benefits available, the Employees Deposit Linked Insurance

Scheme (EDLI) was introduced in 1976.