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What is ESIC scheme, who is eligible, and its benefits?

This statement is on the objectives of the Indian government’s Employee State Insurance Scheme. The main objective of this scheme is to cover workers who might incur health-related contingencies such as permanent or temporary disability, accident at work, or sickness. It also provides maternity benefits. The Employees’ State Insurance Scheme of India is a government funded insurance program. ESIC Scheme provides economic security to employees in the private sectors. It is administrated by the Employees’ State Insurance Corporation.

This insurance policy is a great way to protect your employees if they are sick, pregnant, disabled, or even die from work-related injuries. It also provides medical care for insured employees and their families.

Official data released in January 2022 show that 9.87 lakh new members joined the ESIC-run social security plan in November 2021, compared with 12.57 lakh the previous month, giving insight into formal sector employment in India.

Who is eligible for ESI?

As per FAQs on the ESIC website, the monthly wage ceiling for coverage of an employee is Rs. 21,000 per month. The effect of this decision will be effective from January 1, 2017.

Employers are responsible for enrolling employees in the ESIC program.

The Social Security program provides social welfare to those who need it by basing the contributions on workers’ earning ability, but it awards benefits without discrimination to individuals.

How are contributions made?

The ESI scheme is largely funded by company and employee contributions. They are primarily used to provide monthly fixed payments for medical benefits at a fixed rate, as well as contributions to the State. The FAQ states that 1/8th of total costs are borne by the state government.

For employees earning Rs 21,000 or less per month in salary, the company contributes 3.25 percent and the employee contributes 0.75 percent, for a total of 4 percent.

There’s one change to your insurance status when you’re an ESIC employee—but as long as you stay within the wage limit, your insurance number won’t change. This means that there is no need to reapply for benefits and nothing will be disrupted when you switch jobs.

Is it required for the employer to register for the scheme?

Section 2A of the Women’s Protection Act and Regulation 10-B requires factories to register under the ESI Act within 15 days of their applicability.

This section includes six social security benefits according to ESIC. However, you must meet certain conditions for these benefits. According to the ESIC website, this is a list of all the benefits that can be availed from ESI scheme.

  • Medical Benefit: Unlike private insurance plans, Insured Persons and their family members receive full medical care regardless of the cost of treatment. With a yearly premium of Rs 120, retired and disabled covered persons also receive benefits from national health care.
  • Sickness Benefit(SB) : In the case of illness, insured workers are entitled to Sickness Benefit in the form of cash compensation at a rate of 70% of their wages. To be eligible for benefits, they must contribute for 78 days during a 6-month period.
  • Maternity Benefit (MB) : Maternity benefit is payable for a total of twenty-six (26) weeks–with one month extension on medical advice–at the full salary rate, provided the employee has been remunerated for at least seventy days in his or her last two contribution periods. Maternity benefit is payable for a total of twenty-six (26) weeks–with one month extension on medical advice–at the full salary rate, provided the employee has been remunerated for at least seventy days in his or her last two contribution periods.

Disablement Benefit:

  • Temporary disablement benefit (TDB) : The temporary disablement benefit is payable to cover 90% of your wage while you’re on disability. This can be paid for up to 5 years so long as you remain disabled.
  • Permanent disablement benefit (PDB) : If you’re collecting under our Sudden Death plan, the benefit will be paid at the rate of 90% of your wage as a monthly payment. The extent of your loss in earning capacity will be determined by a certified medical board.
  • Dependants Benefit(DB): DB offers payments to dependents of a deceased Insured person on a monthly basis. The rate of payment is 90% of the deceased person’s wages if they die in a job-related accident or while working.


The ESIC scheme is a great way to get health insurance for yourself and your family. It is affordable and offers good coverage. You can use it to get treatment for any illness or injury, and you can also use it to get preventive care. If you are looking for a health insurance plan, the ESIC scheme is definitely worth considering.

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