AC No. 21

What is AC No. 21?

Account Number 21 (AC No. 21) refers to the Employer’s contribution towards the Employee Deposit Linked Insurance (EDLI) Scheme, managed under the Employees’ Provident Fund & Miscellaneous Provisions Act, 1952. The EDLI provides life insurance coverage to employees who are EPF members.

Key Features:

• Contribution Rate: Employer contributes 0.5% of Basic + DA, subject to ₹15,000 salary ceiling.
• Purpose: Provides life insurance to employee nominees in case of the employee’s death during service.
• Benefit Limit: Maximum ₹7 lakh payable to the nominee as per EPFO rules.
• Frequency: Paid monthly along with PF/EPS contributions in the ECR file.
• Employer Obligation: Mandatory for all PF-registered establishments unless an alternate insurance scheme is approved.

Example

For an employee earning ₹15,000 (Basic + DA), the employer contributes ₹15,000 × 0.5% = ₹75 to AC No. 21 each month.

Why AC No. 21 Matters:

It offers financial protection to employee families, ensuring insurance coverage without requiring separate premiums.