“A sum of Rs 27,000 crore is lying as ‘unclaimed amount‘ in the EPF accounts”. That’s a huge amount!
The reasons for not claiming EPF Scheme benefits can be due to ignorance/ negligence on part of the EPF members, procedural delays by the EPFO or ‘no-claim’ made by the nominees/legal-heirs after the death of the subscribers.
As an EPF subscriber, you may be well aware of the EPF Withdrawal claim submission procedure that needs to be followed by the PF members. But, are you aware of the EPF Death Claim Procedure? God forbids, in case of an unfortunate event, will your nominee/legal-heir be able to claim EPF, EPS and EDLI Scheme benefits without any hassle? Do they know the EPF Death Claim Settlement Procedure? Let’s discuss..
EPF Account Components & Scheme Benefits
If you are a salaried person and contributes to EPF Scheme, you may kindly take out your monthly pay-slip and check, you can notice that every month 12% of your “salary” is contributed towards EPF account. Your total monthly contribution is routed towards Employees’ Provident Fund.
Your employer also contributes 12% of the salary to your EPF a/c. But your employer’s monthly contribution is routed towards various components of PF.
Out of this 12% of your employer’s monthly contribution, 8.33% goes towards EPS (Employees Pension Scheme) and only 3.67% is invested in Employees’ Provident Fund (EPF). So, you contribute 12% of your basic salary and your employer contributes 3.67% of your basic salary towards EPF deposits.
Your Employer also contributes for EDLI Scheme (Employees Deposit Linked Insurance) premium for maximum of 0.5% of Rs 15000 i.e. Rs 75 per month. An employee gets a life insurance cover of Rs 2.5 lakh to Rs 6 lakh (maximum).
How to make EPF Death Claim by Nominee/Legal-heir?
Let’s now understand the important points and the procedure to claim EPF, EPS & EDLI Scheme benefits on death of a Subscriber (EPF member).
EPF Withdrawal Claim on death of a Subscriber
Upon the death of an EPF member, the Employees Provident Fund amount is paid to the nominee that was nominated at the time of opening of the account. If there was no nominee assigned then the EPF amount is paid to the immediate members of the family (legal-heirs).
EPS Pension Claim on Death of an EPF member
A PF Scheme member’s family becomes eligible for the monthly pension benefits in the following cases:
- In case of death of the member while in service and the employer has deposited funds in his/her EPS account for at least one month (or)
- If the member has completed 10 years of service and dies before attaining 58 years of age (or)
- In case of death of the member after the commencement of the monthly pension.
Who can claim EPS Family Pension? -On the death of the employee, EPS pension is payable to ;
- The spouse and two children below 25 years of age.
- When a child reaches 25 years of age, the second child below 25 yrs of age will be given pension and so on.
- If the child is disabled, he/she may a get pension till his death – In any case, only 2 children will receive the pension at a time.
- In case of member not having a family, the pension is payable to single nominated person.
- If not nominated and having dependent parent the pension is payable first to Father and then on father’s death to Mother.
Life Insurance Claim under EPF Account EDLI Scheme?
The Employees’ Deposit Linked Insurance Scheme(EDLI) is an insurance cover provided by the Employees’ Provident Fund Organization (EPFO). A nominee or legal heir of an active member of EPFO gets a lump sum payment of up to Rs 6 Lakhs in case of death of the member during the service period (active EPF member).
- The insurance cover provided under EDLI Scheme depends on the salary drawn in the last 12 months of the employment before death.
- There is no minimum service period for availing EDLI benefits.
- An EPFO member is only covered by the EDLI scheme as long as he/she is an active member of the EPF. His family/heirs/nominees cannot claim it after he leaves service with an EPF registered company.
- The insurance benefits can be availed by the PF Subscriber’s family members, legal heirs or nominee(s). (Family – except major sons, married daughters with major sons, and married grand-daughters).
- In case the member was last employed under an establishment exempted (Private Trust) under the EPF Scheme 1952, the employer of such establishment should furnish the PF details of last 12 months under the Certificate part and also send an attested copy of the Member’s Nomination Form.
How to claim EPF, EPS or EDLI Scheme Benefits?
Earlier, to claim EPF, EPS and EDLI insurance amount, the nominee of a PF member had to submit multiple Claim forms to the EPFO. Form 20 for EPF Withdrawal, Form 10D to claim EPS Pension benefit and Form 5(IF) for EDLI Scheme benefit.
However, the EPFO has recently introduced a ‘Composite Claim Form’ in death cases and has also set a time-line of 7 days to process all EPF Account related Death Claims.
You can download EPF Composite Claim Form for EPF, EPS or EDLI and submit the filled form to the concerned EPFO Regional office.
You need to get the member’s last employer’s sign and seal on the composite claim form. In case, the company is closed then you (claimant) can get the claim form signed by the bank manager of your bank account.
The documents that need to be enclosed with EPF Composite Death Claim Form are;
- Death Certificate of the EPF Member.
- Joint photograph of all the claimants (nominees/legal-heirs).
- Date of Birth certificate of children claiming pension (if any).
- EPS Scheme Certificate (if applicable).
- A copy of cancelled cheque or attested copy of first page of bank Pass Book.
How to do EPF Death claim filing by nominee/beneficiary online?
The EPFO has recently launched an online provision to submit PF death claim forms by the member’s beneficiary.
A word of advice! – In case, you (EPF member) haven’t yet updated your EPF account nomination details then kindly do it immediately. It is very important! Also, do update/change your nominee details after you get married.
In case of death of a member, advisable to file the death claim by the beneficiary, maximum within 3 years of the date of death of the subscriber.
I hope you find this article useful and informative! Do share this information with your family members. Cheers!
- How to submit Online EPF Death Claim by Beneficiary? | Latest Online Procedure
- How to do EPF e-Nomination with Beneficiary Aadhaar & Photo? | Latest & New Online Procedure
- Nominee Vs Legal Heir : Who will inherit (or) own your Assets?
- Online EPF Withdrawal Facility : Details & Procedure
- Tax Implications of EPF, PPF & NPS Withdrawals (Full / Partial) & Maturity proceeds
- Provident Funds – Types & Tax Implications
(Image courtesy of Stuart Miles at FreeDigitalPhotos.net) (Post first published on : 26-June-2019)