Accurate simulation of characteristics performance and state of health (SOH) estimation for lithium-ion batteries are critical for battery management systems (BMS) in electric vehicles. Battery simplified electrochemical model (SEM) can achieve accurate estimation of battery terminal voltage with less computing resources. To ensure the applicability of life-cycle usage, degradation physics need to be involved in SEM models. This work conducts deep analysis on battery degradation physics and develops an aging-effect coupling model based on an existing improved single particle (ISP) model. Firstly, three mechanisms of solid electrolyte interface (SEI) film growth throughout life cycle are analyzed, and an SEI film growth model of lithium-ion battery is built coupled with the ISP model. Then, a series of identification conditions for individual cells are designed to non-destructively determine model parameters. Finally, battery aging experiment is designed to validate the battery performance simulation method and SOH estimation method. The validation results under different aging rates indicate that this method can accurately estimate characteristics performance and SOH for lithium-ion batteries during the whole life cycle.