LIC Digi Credit Life Plan 878 Calculator: Premium and Reducing Loan Cover

What is LIC Digi Credit Life Plan 878?

LIC Digi Credit Life Plan 878 is an online loan-protection plan. Technically it is a non-linked, non-participating decreasing term assurance plan. You take cover equal to your loan, and the cover then shrinks every year in step with the outstanding balance. If the borrower dies during the term, LIC pays the cover for that year, and the family can use it to repay the lender instead of taking on the EMI.

It is sold only through LIC’s website. Its offline twin is Yuva Credit Life 877, available through agents.

Digi Credit Life 878 at a glance

Feature	Details
Plan number	878
Plan type	Decreasing term assurance, non-linked, non-participating
Entry age	18 to 45 years
Age at end of cover	23 to 75 years
Policy term	5 to 30 years
Initial sum assured	₹50 lakh to ₹5 crore
Premium payment	Single or limited (5, 10 or 15 years); no regular premium
Maturity benefit	None
Where to buy	Online only

Eligibility

Condition	Minimum	Maximum
Age at entry	18 years	45 years
Age at the end of the term	23 years	75 years
Policy term	5 years	30 years
Initial sum assured	₹50,00,000	₹5,00,00,000

Choose a term that matches the remaining tenure of your loan, and a sum assured equal to the amount you still owe.

How the premium is calculated

The calculator follows the sample premiums in LIC’s Digi Credit Life sales brochure: ₹50 lakh of initial cover, 25-year term, 8% loan rate, male non-smoker, at ages 20, 30 and 40, for single premium and 5, 10 or 15 years of payment. For example, LIC quotes ₹6,250 a year for 10 years at age 30, and the calculator gives exactly that.

1. Your age: rates between the brochure ages are interpolated; ages above 40 extend the trend.
2. Your term and loan rate: other terms and rates (LIC offers 6% to 12%) are scaled by how much cover remains each year, weighted by the risk in that year. A higher loan rate keeps cover up for longer, so it costs a little more.
3. Payment option: single, or limited pay for 5 years (term 10–30), 10 years (term 15–30) or 15 years (term 25–30). There is no regular-premium option.
4. Rebates and mode: LIC’s high sum assured rebate applies from ₹1 crore (15% up to age 30, 14% for 31–45 on limited pay, more from ₹2 crore and ₹5 crore). A half-yearly instalment is 51% of the yearly premium.
5. Women and smokers are our estimates (about 10% less and 20% more), since LIC publishes samples only for male non-smokers.
6. No GST: individual life premiums are exempt from 22 September 2025.

Worked example. A 30-year-old male non-smoker has a ₹50 lakh home loan at 8% for 25 years. These are LIC’s own brochure figures:

Payment option	Premium	Total paid
Limited, 15 years	₹4,900 a year	₹73,500
Limited, 10 years	₹6,250 a year	₹62,500
Limited, 5 years	₹10,500 a year	₹52,500
Single	₹45,500 once	₹45,500

Age makes a difference too. For ₹50 lakh over 20 years with 10 years of payment, the yearly premium is about ₹4,212 at 25 and about ₹9,151 at 40. A 35-year-old covering ₹75 lakh over 20 years pays about ₹5,073 every six months on half-yearly mode. At a 9% loan rate instead of 8%, our 30-year-old would pay about ₹6,398 a year.

Tip: a single premium is the cheapest in total, but if you prepay or refinance the loan early you have paid for cover you may no longer need. Limited pay keeps more flexibility.

How the cover reduces

In the example above, the death cover at the start of each policy year works out to:

Policy year	Cover (approx.)
1	₹50,00,000
5	₹46,91,800
10	₹41,45,950
15	₹33,43,850
20	₹21,65,350
25	₹4,33,700

The cover falls slowly at first and faster later, because early EMIs are mostly interest. The calculator models this as a standard loan repayment at the interest rate you enter. Your policy document carries LIC’s actual schedule.

Death benefit

If the life assured dies during the term, the nominee receives the higher of:

• the sum assured applicable in that policy year (the reduced cover), or
• 105% of the premiums paid up to the date of death (limited pay only; under single premium the schedule amount is paid).

The money goes to the nominee, not automatically to the bank, unless the policy is assigned to the lender. The family then uses it to close or reduce the loan.

Maturity, surrender and other benefits

There is no maturity benefit. This is pure risk cover, so do not expect any money back if you survive the term. There is no loan facility against the policy. Surrender values, where they apply, are small, so treat the premium as the cost of protection, not an investment.

Tax benefits

Premiums are eligible under Section 123 of the Income-tax Act, 2025 (earlier Section 80C) in the old tax regime, and the death claim is exempt under Section 11 read with Schedule II of the Income-tax Act, 2025 (earlier Section 10(10D)).

Who should buy it, and who should not

Good fit if you:

• have a large home, business or education loan and want the family to inherit the house, not the EMI;
• already have a separate term plan for income replacement and only want to cover the loan;
• want the lowest cost for loan cover.

Look elsewhere if your loan is below ₹50 lakh, or if you want cover that does not shrink. A level plan like Digi Term 876 pays the full sum assured throughout. To compare, run both calculators, or use the LIC term plan calculator.

Digi Credit Life 878 vs Digi Term 876

Point	Digi Credit Life 878	Digi Term 876
Cover over time	Reduces with the loan	Level (or increasing)
Best for	One specific loan	Family income replacement
Term	5–30 years	15–40 years
Cost for same starting cover	Lower	Higher
Example: 30, male non-smoker, ₹50 lakh, 25 years, 10 years of payment (8% loan)	₹6,250 a year	₹8,739 a year

How to use this calculator

1. Enter your details and your current age.
2. Set the term equal to the loan tenure left.
3. Put the outstanding loan as the sum assured and enter your loan rate.
4. Pick a payment option and mode.
5. Compare the premium with the cover table. A higher loan rate keeps cover higher for longer.

All figures are estimates from our rate basis, not LIC quotes. LIC’s final premium and cover schedule depend on underwriting and the policy terms on the day you buy.