Nominee: If the earning member of the family dies suddenly, what can the nominee claim from the company?

In the event of the sudden death of a family member, financial security is equally important as emotional support. Upon the death of an employee working in the organized sector, the nominee or legal heir can make various financial claims. Every family should be aware of this. Here, learn about five major financial benefits that can provide significant support to the family during this difficult time.

1. Outstanding Salary and Bonus: No One Can Withhold Your Rights

The employee's family has the right to receive the full salary for the period of work prior to their death. Furthermore, if the company provides for a performance-based bonus or annual bonus, this is also paid to the family. The company cannot refuse to pay it. This amount is paid to the employee's nominee or, in the absence of a nominee, to the legal heir.

2. Full Provident Fund (PF) Money: This will be a great support for you

The Employee Provident Fund (EPF) is a major part of every employee's savings. Upon an employee's death, the entire amount deposited in their EPF account (both the employee's and the company's share), along with interest, is passed on to their nominee.

How to Claim?
Online: If the nominee's name is updated in the EPF account, they can file a claim online on the EPFO ​​portal.
Offline: For offline claims, a 'Composite Claim Form (Death)' must be filled out, verified by the employer, and submitted to the PF office.

No Nominee: If there is no nominee, the legal heir can file a claim with a 'Succession Certificate'.

3. Gratuity Amount: Benefits Even with Short Service

If an employee has completed five years of continuous service with the same company, they are eligible for gratuity. However, in the event of death, the five-year requirement does not apply. This means that even if the employee has worked for just one year, their family will still receive gratuity.

How is gratuity calculated?
Gratuity is calculated based on the employee's last salary and length of service. The formula is: (last salary x 15/26 x years of service). The company can pay a higher amount if it wishes, but under the law, the maximum gratuity amount is up to ₹20 lakh. This amount is also paid to the nominee or legal heir.

4. Employee Deposit Linked Insurance (EDLI) Scheme: Premium-Free Insurance Cover
Every EPF member receives life insurance cover under the Employee Deposit Linked Insurance (EDLI) Scheme. The employee does not have to pay any premium for this insurance; the contribution is made by the employer. In the event of an employee's death, their nominee receives the insurance proceeds. This insurance cover is limited to a minimum of ₹2.5 lakh and a maximum of ₹7 lakh. This amount depends on the employee's salary for the last 12 months. EDLI funds can be claimed along with the PF claim.

5. Family Pension Benefit: A Regular Income for the Family

If an employee has worked for 10 years, they are entitled to a pension under the Employees' Pension Scheme (EPS). After their death, their family receives the pension benefit.

Who receives the pension?
Spouse: The employee's spouse receives a lifetime pension.
Children: Two children receive 25% each of the pension until they reach the age of 25. If the child is disabled, they may receive a lifetime pension.
Parents: If the employee was unmarried, their pension can be paid to their dependent parents.
Nominee: If there is no one in the family, the pension is paid to a nominee appointed by the employee.

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