EPFO or Employees’ Provident Fund Organisation is world’s largest social security organization, which is responsible for regulation and management of provident funds, pensions and the mandatory life insurance in India. It would interesting for an EPFO member to know that he or she can pay its Life Insurance Corporation or LIC premium from its Employees’ Provident Fund (EPF) account.
According to tax and investment experts, for LIC premium payment from EPF account, one needs to submit Form 14 at EPFO and at the time of Form 14 submission, one’s EPF balance should be at least equal to two years LIC premium amount.
Speaking on the LIC premium payment facility from EPF account; Pankaj Mathpal, Founder & Managing Director at Optima Money Managers said, “An EPFO member is allowed to pay one’s LIC premium from its provident fund (PF) account by submitting Form 14 at the EPFO. However, while submitting this Form 14 at EPFO, one should have a EPF balance to the tune of two years of LIC premium amount.” He said that one can avail this facility while buying an LIC policy or at later stage of the LIC premium payment.
Speaking on LIC payment from EPF account; Kartik Jhaveri, Director – Investments at Transcend Capital said, “To avail this facility one needs to submit this form and allow both LIC and EPFO to link up the LIC policy and one’s EPF account. However, one must make sure that this EPFO facility is available for LIC premium payment only and an EPFO member can’t exercise this facility for any other insurance premium payment.”
Calling this EPFO rule as blessing in disguise during financial crisis; Mumbai-based tax and investment expert Balwant Jain said, “This EPFO rule in regard to LIC payment can be a boon for those who are under financial stress in current Covid-19 crisis and after the emergence of Omicron virus they don’t see any hope of revival, they can use their PF balance as an option to continue one’s LIC policy.”
Balwant Jain said that both LIC and EPF is an important part of a professional but LIC payment from EPF account should be used only when there is any kind of financial crisis. And one should immediately discontinue this facility once the financial crisis is over.
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