Employees' State Insurance Scheme (ESIC)
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- TATA AIG Team
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The Government Of India has been introducing various financial products and schemes to help the larger section of society be protected against financial inconsistencies due to medical treatment or an emergency. The Employees' State Insurance Scheme is one such initiative by the Government that provides financial protection to employees and their families in the organised sector.
Here is a detail about what it means, the eligibility and the benefits.
What Is The Employees' State Insurance Scheme?
The Employees' State Insurance(ESI) Scheme is a social insurance scheme designed to protect the 'employees' as stated under the 'Employees State Insurance Act, 1948'. The scheme was introduced on 24th February 1952. It offers financial protection against the medical impact of certain health implications such as maternity, sickness, disablement and death due to an injury caused during work and health care to the insured and their families. The scheme is administered and managed by the Employees State Insurance Corporation(ESIC). The ESIC claim process is simple and relatively easy.
ESIC Eligibility Criteria
The ESI scheme applies to establishments and factories in the field of Road Transport, Restaurants, Hotels, Cinemas, Shops, Construction Sites, and other Educational and Medical Institutions wherein a minimum of 10 people are employed. In some states, the upper limit on ESI eligibility is a minimum of 20 people employed. The responsibility of enrolling the employees on the ESI scheme rests with the employers. Employees working in such establishments and earning up to ₹21,000 are entitled to financial benefits under the ESI scheme.
How Is The ESIC Payment Made To The Scheme?
The employers and the employees have to contribute to the scheme. The employer's contribution rate is fixed at 4.75% of the salary payable to the employees, and the employee's contribution rate is fixed at 1.75% of the employee's salary.
According to Section 2A of the Employees State Insurance Act 1948, the employer has to mandatorily register their establishment within 15 days of its inception under the ESI Act.
ESI Benefits Eligibility
The ESI scheme is designated to provide various benefits to employees and their families. The application and the ESIC claim procedure are less time-consuming and extremely user-friendly.
1. Medical Benefits- The insured employees and their families will receive full medical care. There is no stated limit on the extent of funds that the insured person can receive for treatment from the scheme. On paying an extra premium of ₹ 120, the benefit is provided to retired and permanently disabled people and their spouses.
2.Sickness Benefits- When a sickness certified by a medical authority is present for a maximum of 91 days per year, the insured employees can receive a sickness benefit of up to 70% of their salaries as compensation. However, the insured employee must contribute for 78 days during six months to be eligible for this benefit.
*3. Maternity Benefit - A maternity benefit during the pregnancy is payable to the insured employee for a total period of 26 weeks and an extension of one month on a medical expert's advice for the full salary. However, the benefit is subject to a payment made for 70 days in the two preceding contribution periods.
4.Disablement Benefit- The disablement benefit is categorised into two different types.
a.Temporary Disablement Benefit(TDB) - A TDB of 90% of the salary payable is provided to the insured as long as the disability continues. It is irrespective of the contribution made and applicable from the first day of employment if the injury is caused due to work-related accidents. b.Permanent Disablement Benefit(PDB) - A PDP of 90% of the salary payable is provided to the insured as a monthly payment based on the extent of loss and the earning capacity as certified by a medical professional.
5.Dependent Benefit - The dependent benefit at the rate of 90% of the wages is paid to the dependents of the deceased insured person monthly when the death is caused due to an occupational hazard or an injury while carrying out work-related activities.
6.Other ESIC benefits - A sum of ₹15,000 will be paid from the ESI scheme to the dependents to perform the final rites of the insured person. An insured woman will receive the financial benefit associated with the confinement expenses where medical services are not accessible based on the ESI scheme.
Having a health insurance plan in addition to the benefits provided by the Employees' State Insurance Scheme (ESIC) can provide an additional layer of protection for employees and their families. A health insurance plan can cover other medical expenses such as hospitalisation, surgeries, and treatments. It can also help cover the cost of treatments that are not available through the ESIC network.
Additionally, a critical illness insurance plan can provide coverage for family members who are not covered under the ESIC scheme. At Tata AIG, we provide a range of health insurance plans with customisable features to ensure financial protection during an emergency and otherwise based on individual needs. Overall, having a health insurance policy and the benefits provided by the ESIC can provide more comprehensive protection and peace of mind for employees and their families.
The Employees' State Insurance Scheme (ESIC) is an important social security program in India that provides a range of benefits to employees and their families in the event of illness, injury, or death. The program is administered by the Employees' State Insurance Corporation (ESIC) and is funded through payroll contributions from employers and employees.
The ESIC provides a comprehensive safety net to employees and their families, including medical treatment, disability and survivor benefits, and cash benefits for maternity and sickness and funeral expenses. Overall, the ESIC plays an important role in ensuring that employees and their families have access to financial support and medical care during times of need.