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Provident Fund and Survivor Insurance |
The regulatory framework for Provident Fund and Survivor Insurance is provided under the following laws:
- Employees Provident Fund and Miscellaneous Provisions Act, 1952
- The Employees' Deposit Linked Insurance Scheme, 1976.
In 2004, a voluntary old-age, disability, and survivors benefits scheme, part of the Unorganized Sector Social Security Scheme for employees and self-employed persons of 36 to 50 years of age with monthly earnings of 6,500 rupees or less but without mandatory coverage, was introduced as a pilot program in 50 districts. Contributions are income related and flat rate.
Employees' Provident Fund Scheme takes care of following needs of the members:
(i) Retirement (ii) Medical Car (iii) Housing (iv) Family obligation (v) Education of Children (vi) Financing of Insurance Polices. Amount of Provident Fund at the credit of the deceased member is payable to nominees/ legal heirs. The Employees' Provident Fund Organisation, India, established under the provisions of Employees Provident Fund and Miscellaneous Provisions Act, 1952, is one of the largest provident fund institutions in the world in terms of members and volume of financial transactions. The Employees’ Provident Funds & Miscellaneous Provisions Act, 1952 applies to specific scheduled factories and establishments employing 20 or more employees and ensures terminal benefits to provident fund, superannuation pension, and family pension in case of death during service. Separate laws exist for similar benefits for the workers in the coal mines and tea plantations.
Provident fund and survivor (deposit-linked) insurance covers Employees, including casual, part-time, daily wage workers, and those employed through contractors, with monthly earnings of 6,500 rupees or less working in establishments with a minimum of 20 employees in one of the 182 categories of covered industry (the establishment remains covered even if the number of employees falls below 20); employees of other establishments specified by law, including cooperatives with more than 50 employees and establishments with less than 20 employees; newspaper employees; and cinema and theatres employing 5 or more persons. It provides for voluntary coverage for employees of covered establishments with monthly earnings of more than 6,500 rupees, with the agreement of the employer and voluntary coverage for establishment with less than 20 employees if the employer and majority of the employees agree to contribute.
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