New EPFO rule: No Guardianship certificate needed for death claim payment to minor children

The Employees' Provident Fund Organisation (EPFO) has simplified the processing of death claims by removing the need for a Guardianship Certificate for settlements to bank accounts of minor children.

Currently, if the settlement amount in case of a deceased member is to be paid to his/her surviving minor children, the EPFO requires a Guardianship Certificate, which often causes delays in claim processing.

"It has come to the notice that many offices are seeking Guardianship Certificates in cases where the settlements in respect of a deceased member are to be paid to his/her surviving minor children," the EPFO said in a circular on Wednesday, August 13.

To make the process more efficient, the EPFO has eliminated this requirement.

The EPFO added, "In this regard, with a view to simplify the process and also to ensure speedy settlement to the minor children, it is hereby directed that no separate Guardianship Certificate be insisted if the settlements are being credited to the Bank Accounts of the minor children."

The PF body has advised the claimants to open individual bank accounts in the name of the minor children so that the settlement proceeds, along with the pension, can be credited to them.

"Accordingly, the claimants be suitably guided to open individual bank accounts in the name of the minor children for crediting the settlement proceeds as well as pension due to them," the EPFO said.

EPFO regulations

In case of the death of an EPFO beneficiary, their family continues to receive family pension, even if they were an ex-serviceman at the time of death.

However, assurance benefit under the EDLI scheme is only payable in case of death while in service. If the death occurs after leaving the service, the assurance benefit would not be admissible.

The Employees' Deposit Linked Insurance (EDLI) scheme acts as a life insurance cover, offering a lump sum payment to the beneficiary or nominee of a deceased employee who was a member of the Employees Provident Fund (EPF) scheme. The scheme provides financial security to the families of employees who die during their service period.