Employees' State Insurance (ESI)

The Employees' State Insurance Scheme, under the ESI Act, 1948, offers social insurance to protect eligible employees with medical and financial benefits.
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3 min
27-October-2025

Wondering what is ESI and how it benefits employees in India? The Employees' State Insurance (ESI) scheme is a government-backed social security programme that provides financial protection and medical benefits to eligible employees and their dependants during specified contingencies.


The Employees' State Insurance Corporation (ESIC) administers the ESI scheme and ensures its effective implementation across the country. Understanding what is ESI is important for both employers and employees, as the scheme covers benefits related to sickness, maternity, employment-related injuries, disability, and dependent support. Employers registered under the scheme fulfil statutory compliance requirements, while eligible employees gain access to healthcare and income support during unforeseen circumstances. Alongside social security benefits, individuals may also consider fixed-income investments, such as Bajaj Finance Fixed Deposits, to strengthen their long-term financial planning and build a stable savings corpus.


What is ESI?

ESI, or Employees’ State Insurance, is a social security and health insurance program launched under the ESI Act of 1948. It protects employees against loss of wages during medical leave, maternity, temporary or permanent disability, and even death due to employment-related injuries.

Eligible employees who subscribe to the ESI scheme can access a wide range of benefits — including healthcare for themselves and their dependents, wage replacement during illness, and maternity support.

Just like ESI safeguards your health, an FD safeguards your finances. Start an FD with Bajaj Finance today to enjoy stable, guaranteed returns — even when markets fluctuate.


Also read: What is Shram Suvidha Portal

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ESIC registration eligibility

The ESI scheme applies to non-seasonal factories and establishments with more than 10 employees (or 20 employees in some states). Employees earning a basic salary of up to Rs. 21,000 per month (Rs. 25,000 for persons with disability) must be covered. These businesses are required to register with the ESIC within 15 days of the scheme becoming applicable to them.

Under the ESI scheme, employers contribute a larger share: 3.25% of each employee's total monthly wages. Employees contribute 0.75% of their monthly wages throughout the year. However, there's an exemption: employees whose daily wages are less than Rs. 176/- are not required to contribute.

Benefits of ESIC registration

Here are some of the key benefits:

  • Sickness support: Employees receive 70% of their wages for up to 91 days per year during certified illnesses.
  • Extended illness coverage: Employees diagnosed with any of 34 listed critical illnesses can get 80% of their wages for up to two years during treatment.
  • Family planning support: Employees undergoing sterilisation—7 days of full wages for vasectomy and 14 days for tubectomy—are paid during the recovery period.
  • Medical benefits for families: Under the ESIC scheme, employees and their dependents get access to full medical care.
  • Maternity benefits: Women employees receive full wages for 26 weeks of maternity leave, with an option to extend by one month if needed.

If you’re an employer looking to secure employee well-being, also consider securing your own financial stability. Invest surplus business funds in a corporate FD with Bajaj Finance and earn assured, periodic returns. Explore FD Options.

How to register for ESIC scheme?

To register for the ESIC scheme, follow these steps:

  1. Visit the Employees State Insurance Corporation (ESIC) portal and click on the 'Employer Login' option.
  2. Click on the 'Sign up' button.
  3. Fill in the necessary details in the form and submit it.
  4. Check your registered email ID for the username and password.
  5. Log in to the ESIC portal using the provided credentials.
  6. Select the 'New Employer Registration' option.
  7. Choose the 'Type of unit' from the drop-down menu and click 'Submit'.
  8. Complete the 'Employer Registration Form' with the required details.
  9. After registration, proceed to make the necessary payment.

Also read: What is Jeevan Pramaan Portal


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Entities Covered Under ESIC

The Employees State Insurance (ESI) scheme extends to a variety of businesses and establishments. As per Section 1(5) of the ESI Act, the following state-governed entities are covered:

  • Shops
  • Restaurants or hotels focused primarily on sales
  • Cinemas (including preview theatres)
  • Road motor transport establishments
  • Newspaper establishments (not covered under the Factory Act)
  • Private medical institutions
  • Private educational institutions
  • Municipal Corporations or Municipal Bodies (specifically, casual employees)

If establishments mentioned above have a workforce of 10 or more, the owner/employer must register them with the Employees State Insurance Corporation (ESIC).

The central government has expanded ESI coverage under Section 1(5) to include the following types of establishments:

  • Shops
  • Hotels and restaurants
  • Road motor transport establishments
  • Cinemas (including preview theatres)
  • Newspaper establishments
  • Establishments involved in:
    • Insurance
    • Non-Banking Financial Companies (NBFCs)
    • Port trusts
    • Airport authorities
    • Warehousing

Businesses within these categories must have 20 or more employees to require mandatory registration with the ESIC.

Conclusion

The Employees’ State Insurance Corporation (ESIC) is a vital safeguard for India’s workforce. It ensures employees receive timely medical and financial assistance while promoting employer accountability.

However, financial preparedness shouldn’t end at ESIC. Building your own financial cushion through a Fixed Deposit can ensure liquidity, stability, and predictable income — even when life throws surprises.

Invest in Bajaj Finance FD and grow your savings with secure, high-yield returns.

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Frequently asked questions

Is employee state insurance mandatory?

Yes, ESIC is mandatory for companies with 10 or more employees and for employees earning less than Rs. 21,000 per month.

Is ESIC applicable for Rs. 35,000 salary?

No, ESIC is not applicable if your salary exceeds Rs. 21,000 per month.

Is ESIC applicable for Rs. 25,000 salary?

No, as the salary exceeds Rs. 21,000 per month, ESIC is not applicable.

Can I claim ESI in a private hospital?

Yes, you can claim ESI benefits in private hospitals that are empaneled under the ESI scheme.

What is Employee State Insurance medical benefits?

Employee State Insurance (ESI) medical benefits cover full medical care for insured employees and their dependent family members. These include outpatient consultations, hospitalisation, maternity care, and treatment of occupational illnesses through ESIC hospitals and dispensaries, ensuring affordable and accessible healthcare during employment.

What is ESIC and who is eligible?

The Employees' State Insurance Corporation (ESIC) is a social security scheme providing medical, maternity, disability, and dependent benefits. It covers employees earning Rs. 21,000 or less per month (Rs. 25,000 for persons with disabilities) working in establishments with 10 or more workers, as per ESI Act provisions.

What is the ESI benefit period?

The ESI benefit period is a six-month window during which eligible employees can claim medical and cash benefits. It corresponds to the previous contribution period. For example, contributions made from April–September entitle employees to benefits from January–June, and October–March contributions cover benefits from July–December.

Can I open a Fixed Deposit if I’m a salaried employee under ESIC?

Yes, any salaried employee can invest in a Bajaj Finance FD. With flexible tenures from 12 to 60 months, it’s an ideal way to create short-term and long-term wealth. Open FD.

What are the key financial literacy skills for smart purchasing?

Key financial literacy skills include budgeting, comparing prices, understanding interest rates, evaluating the total cost of ownership, distinguishing between needs and wants, and avoiding impulse purchases. These skills help individuals make informed spending decisions and manage their finances more effectively.

How can I improve my financial literacy while in college?

College students can improve financial literacy by creating a budget, tracking expenses, learning basic banking and investing concepts, understanding credit and taxes, and using reliable educational resources. Regularly managing personal finances and practising responsible saving habits also build strong long-term financial skills.

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Disclaimer

As regards deposit taking activity of Bajaj Finance Ltd (BFL), the viewers may refer to the advertisement in the Indian Express (Mumbai Edition) and Loksatta (Pune Edition) furnished in the application form for soliciting public deposits or refer https://www.bajajfinserv.in/fixed-deposit-archives
The company is having a valid Certificate of Registration dated March 5, 1998 issued by the Reserve Bank of India under section 45 IA of the Reserve Bank of India Act, 1934. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the company or for the correctness of any of the statements or representations made or opinions expressed by the company and for repayment of deposits/discharge of the liabilities by the company.

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