Dear All,
While thanking Govindsinghnegi for his input, I am giving some more inputs on the exemption and it's advantages for the benefits of all, as under:
Advantages of Employees’ Deposit linked insurance Fund Scheme
Advantages to the Employer:
The premium payable by the employer is usually less than the total contribution being paid by the employer to R.P.F.C; particularly when the salary level is high and average age of the group is low.
Settlement of claim is quicker, LIC requires only the death certificate and the Claim Form from the employer.
Premium paid by the employer is treated as normal business expenses for Income-Tax purpose.
Advantage to the Employee:
Each employee is covered for a sum assured ranging between 5,000 to 2,00,000 depending upon the current salary and service put in from day one irrespective of the actual balance in the Provident Fund. Alternatively every employee/ worker can be covered for a uniform sum assured which will be decided depending upon the group size.
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. Central PF Commissioner has authorized the R.P.F.C. to grant exemption from the 1st of the month in which the application for relaxation is submitted. LIC also offers necessary guidance to the employers for seeking relaxation.
Exemption from the Employees Deposit Linked Insurance Scheme, 1976
Section 17 (2A) of the Act provides for grant of exemption from the operation of Employees Deposit Linked Insurance Scheme, 1976. It is granted to an establishment, where the employees are, without making any separate contribution or payment of premium, in enjoyment of benefits in the nature of Life Insurance whether linked to their deposits in Provident Fund or not and such benefits are more favorable than the benefits admissible under the Insurance Scheme. It is granted by the Central Provident Fund Commissioner by notification in the official gazette and is subject to conditions that may be specified in the notification. It is granted either prospectively or retrospectively.
Pending grant of exemption to an establishment relaxation order may be issued under Para – 28 (7) of the Employees Deposit Linked Insurance Scheme, 1976.
An establishment exempted from the operation of Employees’ Deposit Linked Insurance Scheme, 1976 is required to submit a monthly return to the Regional Provident Fund Commissioner by the 25th of the month in Form 7(IF).
Para 28 (4) of the Scheme provides for grant of exemption by the Central Provident Fund Commissioner to any Class of employees.
Under Section 17 (2B) read with Para – 28 (1) of the Employees’ Deposit Linked Insurance Scheme, 1976, the Regional Provident Fund Commissioner may grant exemption from the operation of all or any of the provisions of the Employees’ Deposit Linked Insurance Scheme to an employee.
The establishment shall pay inspection charges at the rate of 0.005 % of the basic wages and Dearness Allowance subject to a minimum of Rs.1/- per month.