Calculators LIC plans Term plans
Decreasing term cover for outstanding loans, online-only.
LIC Digi Credit Life (Plan 878) is an online-only decreasing-term plan designed to cover an outstanding loan. The sum assured decreases over time in line with a notional loan outstanding balance, so the cover always approximates what your nominee would need to repay if you died. Entry ages 18–65, policy term 5–35 years (aligned to loan tenure), and single or regular premium paying modes. The plan is simple: if you die, LIC pays your nominee enough to clear the loan. If you survive, no payout.
SA tracks outstanding loan balance. Designed for loan protection.
Death of the life assured during the policy term. The nominee receives the sum assured as it stands at the date of death — which decreases each year in line with the notional outstanding loan principal. At year 1, the SA is approximately the original loan amount; by the final years of the policy, it may be ₹5–10 lakh. LIC pays this amount as a lump sum — what the nominee does with it (whether they repay the loan or not) is their choice.
Suicide in the first 12 months. Lapse (regular-pay). The decreasing SA does not match every loan's actual amortisation schedule precisely — if your actual outstanding balance is different from the notional schedule, there may be a gap or surplus. Income replacement after death is not covered — only the notional loan balance. Disability or illness that causes you to stop earning and miss loan payments is not covered by this plan.
For a ₹1 crore home loan over 25 years, indicative annual premium: Digi Credit Life roughly ₹7,000–10,000/year (decreasing risk, so cheaper); LIC Digi Term with ₹1Cr level SA roughly ₹11,000–14,000/year. The ₹4,000/year difference over 25 years is ₹1 lakh in total premium saved — but you lose the income-replacement function and the residual protection after the loan is repaid. The rational choice: if you already have separate income-replacement term cover, Digi Credit Life for the loan is efficient. If this would be your only term cover, take a level-SA plan at ₹1Cr and it covers both the loan and your family.
Digi Credit Life is best for home loan borrowers who already hold sufficient income-replacement term cover and want a specific, cheap, loan-cancellation product to sit alongside it. Banks sometimes insist on credit life insurance as a condition of loan approval — in that case, buy Digi Credit Life rather than the bank's own bundled product, which is almost always more expensive. Also suitable for single-purpose borrowers (car loans, business loans) where the loan is the only financial exposure and family income is not dependent on the individual. Not suitable as a standalone protection product for a family breadwinner.
Premiums deductible under §80C (up to ₹1.5L/year). Death benefit paid to nominee is tax-free under §10(10D). Note: some lenders bundle credit life premium into the loan EMI — if the premium is paid via the loan and not directly by you, the deductibility depends on whether LIC treats you as the policyholding taxpayer. Confirm the premium receipt is in your name for §80C purposes.
LIC does have an online premium calculator — it's their Quick Quote tool on the eBiz portal. Enter your name, date of birth, gender, and mobile number, then pick this plan on the next screen to see the actual premium for your profile.
This is an online-only plan — the quote and purchase flow are fully on LIC's website. No agent or branch visit needed.
Open LIC's Quick Quote tool ↗Or browse the official plan page ↗ for brochures and policy documents.
Asymmetrica isn't an insurance advisor. The analysis above is editorial, sourced from published LIC brochures. Verify eligibility, current rates, and plan-specific conditions with LIC or a licensed advisor before purchasing.
Last updated · site changelog