The Employees' Provident Fund Organisation (EPFO) has announced an important increase in the death benefit for Provident Fund (PF) account holders, enhancing financial security for employees' families. Effective april 1, 2025, the death relief compensation will rise significantly from ₹8.8 lakh to ₹15 lakh, providing better support for dependents during unforeseen events.
This substantial hike ensures families receive a more considerable safety net. The revised amount will be directly transferred to the nominee or legal heir of the deceased employee via the Staff Welfare Fund. Additionally, starting april 1, 2026, the death relief amount will automatically increase by 5% annually to mitigate inflation and ensure long-term financial assistance for families.
The claim settlement process has also been simplified to avoid the lengthy procedures that previously delayed payouts. Families will benefit from a streamlined mechanism that enables quicker disbursement of claims, and in cases involving minor children, the requirement for a guardianship certificate has been eliminated, saving time and legal complexity.
Employer contributions to an employee's PF account are allocated in three ways: 3.67% goes to the Provident Fund (EPF), 8.33% is directed to the Employees' Pension Scheme (EPS), and the remainder supports the insurance component. This structured contribution not only aids in securing retirement but also extends financial protection to dependents in the event of an untimely death.
In summary, the EPFO’s enhancements to the death relief benefit reflect a commitment to improving the financial safety net for employees' families, thereby strengthening trust in India’s largest retirement savings scheme.
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