LIC Digi Term (876) Calculator

LIC Digi Term (876) Calculator

What this calculator does

LIC's Digi Term (Table No. 876) is a non-linked, non-participating pure term insurance plan bought entirely online. Unlike LIC's savings/endowment plans, it has no bonus and, in its standard form, no maturity payout at all - the entire premium goes towards death cover, which is why the same Sum Assured costs far less here than under a savings plan.

The plan offers three Death Benefit Options:

• Level Sum Assured - the death benefit stays exactly the Sum Assured you chose, for the whole Policy Term.
• Increasing Sum Assured - the death benefit starts at the Sum Assured and increases by a simple 10% of the original Sum Assured at the end of every completed policy year, capped at 200% of the original Sum Assured (reached at the end of year 10) - so cover keeps pace with inflation and rising responsibilities in the early years, at a modest extra cost.
• Return of Premium (ROP) - all the base premiums you've paid are returned to you in full if you survive the full Policy Term, at the cost of a higher premium than Level or Increasing cover.

This calculator gives you an indicative estimate of:

• the premium for your chosen Death Benefit Option, Premium Paying Term, and payment mode - factoring in age, gender, smoking/tobacco habit, and a high-Sum-Assured rebate
• the Death Benefit payable, including how it moves over time under the Increasing option
• the Maturity Benefit (nil, unless you picked Return of Premium)
• a year-by-year schedule of premiums paid to date and the death benefit that would be payable in each shown policy year

Formula Used

Eligibility. Entry age must be between 18 and 65 years, the Policy Term between 10 and 40 years, and the Policy Term is capped so cover ends by age 80:

$$EntryAge + PolicyTerm \le 80$$

Premium Paying Term options. You may pay premiums for the full Policy Term, a reduced term (5, 10, or 15 years shorter, subject to a minimum Premium Paying Term of 5 years), or as a one-time Single Premium:

$$PremiumPayingTerm = PolicyTerm - Reduction, \quad Reduction \in \{0, 5, 10, 15\}$$

Base mortality rate. The illustrative tabular annual rate (₹ per ₹1,000 Sum Assured) rises with age at entry and, more gently, with the length of the Policy Term:

$$BaseRate(age, term) = 0.5 + age \times 0.06 + term \times 0.015$$

Loadings and rebates. A smoker/tobacco-user loading and a female rebate are applied multiplicatively, and a High Sum Assured Rebate (per ₹1,000) is subtracted for larger policies:

$$Rate = BaseRate \times SmokerFactor \times GenderFactor - Rebate(SumAssured)$$ $$SmokerFactor = \begin{cases} 1.6 & \text{Smoker / Tobacco User} \\ 1.0 & \text{Non-Smoker} \end{cases} \qquad GenderFactor = \begin{cases} 0.9 & \text{Female} \\ 1.0 & \text{Male} \end{cases}$$ $$Rebate(SumAssured) = \begin{cases} 0.4 & SumAssured \ge 5,00,00,000 \\ 0.3 & SumAssured \ge 2,00,00,000 \\ 0.15 & SumAssured \ge 1,00,00,000 \\ 0 & \text{otherwise} \end{cases}$$

Death Benefit Option loading. The base rate above prices Level cover; Increasing and Return of Premium cover cost more, to fund the extra average sum at risk (Increasing) or the end-of-term refund (ROP):

$$OptionMultiplier = \begin{cases} 1.00 & \text{Level} \\ 1.15 & \text{Increasing} \\ 1.75 & \text{Return of Premium} \end{cases}$$ $$AnnualPremium = \frac{SumAssured}{1000} \times Rate \times OptionMultiplier$$

For a Single Premium, the one-time payment is priced as a discounted lump sum of what the "same as Policy Term" regular-pay option would have cost in total over the whole term:

$$SinglePremium = AnnualPremium(\text{full term}) \times PolicyTerm \times 0.55$$

For regular/limited-pay options, the annual premium is split by payment mode using LIC's standard modal factors (yearly 1.00, half-yearly 0.510, quarterly 0.260, monthly 0.0875):

$$InstallmentPremium = AnnualPremium \times ModeFactor$$ $$TotalPremiumPayable = InstallmentPremium \times InstallmentsPerYear \times PremiumPayingTerm$$

Death Benefit. Under Level cover and Return of Premium, the death benefit is simply the Sum Assured for the whole term. Under Increasing cover, it grows by a simple 10% of the original Sum Assured at the end of each completed policy year, capped at 200% of the original Sum Assured:

$$DeathBenefit(year) = \begin{cases} SumAssured & \text{Level or ROP} \\ \min\big(SumAssured \times (1 + 0.10 \times year),\ 2 \times SumAssured\big) & \text{Increasing} \end{cases}$$

Maturity Benefit. Under Level and Increasing cover, nothing is paid if you survive the full Policy Term - the plan is pure protection. Under Return of Premium, all base premiums paid over the Premium Paying Term are returned in full:

$$MaturityBenefit = \begin{cases} 0 & \text{Level or Increasing} \\ TotalPremiumPayable & \text{Return of Premium} \end{cases}$$

Note: these rates and eligibility limits are illustrative approximations for planning purposes, not LIC's official IRDAI-approved rate table, which can change over time and depends on full medical underwriting. Always confirm exact figures with LIC or an authorized agent before purchasing a policy.

How to Use

1. Enter your Age at Entry in years (18 to 65).
2. Select your Gender and Smoking/Tobacco Habit - both affect the premium.
3. Enter your desired Policy Term in years (10 to 40, subject to cover ending by age 80).
4. Enter your desired Sum Assured (minimum ₹50,00,000, in multiples of ₹5,00,000).
5. Choose a Death Benefit Option - Level, Increasing, or Return of Premium.
6. Choose a Premium Paying Term Option - same as Policy Term, reduced by 5/10/15 years, or Single Premium.
7. Choose your Premium Payment Mode (ignored if you picked Single Premium).
8. Click Calculate Premium to see your premium, death benefit, maturity benefit, and the year-by-year schedule.

Worked Example

Suppose a 32-year-old non-smoker male, wants a Policy Term of 30 years, a Sum Assured of ₹1,00,00,000, Level cover, the "Same as Policy Term" premium option, and yearly payment mode.

$$BaseRate(32, 30) = 0.5 + 32 \times 0.06 + 30 \times 0.015 = 0.5 + 1.92 + 0.45 = 2.87$$

Since Sum Assured is exactly ₹1,00,00,000, a rebate of 0.15 per mille applies, and there is no smoker loading or female rebate:

$$Rate = 2.87 \times 1.0 \times 1.0 - 0.15 = 2.72$$ $$AnnualPremium = \frac{1,00,00,000}{1000} \times 2.72 \times 1.00 = 10{,}000 \times 2.72 = ₹27{,}200 \text{ per year}$$

Over 30 years that's a total premium payable of 27{,}200 \times 30 = ₹8{,}16{,}000. If death occurs at any point during the 30-year term, the family receives the full ₹1,00,00,000 Sum Assured; if the policyholder survives to the end of the term, no maturity benefit is paid, since Level cover is pure protection.