A college education typically requires a large financial outlay. However, what would happen if your child had to leave? The refund for tuition, fees, room and board, and other costs may be available depending on the student’s departure date. Otherwise, you may end up losing the whole sum. In certain cases, tuition insurance might be worth considering.
Tuition insurance may not be mandatory for everyone but can potentially save thousands of dollars in an emergency which is worth it. Similar rules apply to the leave policies offered by many colleges. Before making any decisions, it’s crucial to thoroughly research your school’s policy and explore all available options.
What is Tuition Insurance
Tuition insurance, also known as tuition refund insurance, covers tuition and eligible expenses in the event of an emergency resulting in an unplanned semester withdrawal. Policy rules vary, but in general, severe illness, accident, or emergency must prevent a student from continuing their education. In certain instances, coverage may extend to unanticipated illness and injury in addition to chronic or preexisting conditions.
How Does Tuition Insurance Work
Tuition insurance may pay up to 100% of your non-refundable expenses for the following making it worth it. In addition, this depends on the policy if the student passes away or has to drop out for a reason specified in the policy:
- Education costs.
- Fees for academic work.
- Housing costs, whether on or off campus, do not include security deposits.
Certain policies offer up to 100% reimbursement for non-refundable fees, tuition, and living costs lost in the event of an illness or accident. However, if you leave school early due to a mental health problem, you may only receive 80% of your lost money.
What Does Tuition Insurance Cover
Tuition insurance coverage details differ depending on the provider and your school. But the majority of providers pay for tuition, lodging, and other costs after:
- Death within the family.
- An accident or sickness that changes life.
- An injury, disability, or chronic illness.
- A crippling disease or condition related to mental health.
Providers are beginning to offer pandemic or epidemic coverage in the wake of the COVID-19 pandemic. Prominent tuition insurance provider GradGuard will cover COVID-19 on any plans bought on or after February 18, 2022.
What Does Tuition Insurance Not Cover
Tuition insurance coverage is usually not provided for epidemics and pandemics that are officially recognized by the Centers for Disease Control and Prevention and the World Health Organization. However, some plans currently cover students who have to miss school because they become ill with Covid-19. However, these plans won’t cover students who miss school because they are afraid they will get Covid-19.
Other common exclusions include:
- Taking part in professional athletic competitions.
- Engaging in a riot or other civil unrest.
- Drug abuse.
- Extremely risky activities, such as skydiving, scuba diving, and bungee jumping.
How Much Does Tuition Insurance Cost
The cost of tuition insurance is approximately 1% of the total cost of tuition which is worth it. For instance, if you require coverage for $30,000 annually, the total cost is likely to be around $300. However, if your school is not a part of a tuition reimbursement program, your premium may double.
With a tuition insurance policy, you can choose the extent of your coverage with is worth. You can either guarantee the entire tuition amount for the semester or quarter or a portion of the student’s tuition. Additionally, a policy is valid for the current academic semester or quarter and requires renewal for continued coverage.
Is Tuition Insurance Worth It
Tuition insurance can help recover university education costs, provided the policy’s withdrawal clause addresses the cause of withdrawal. Not every explanation for dropping out of school is covered. If you’re concerned about your child’s potential college acceptance, purchasing tuition insurance may not be a wise decision.
Therefore, it might be wiser to have a serious conversation with your child before making a college investment. Additionally, you should confirm that you are aware of any policy restrictions, such as whether the insurance provider will not reimburse all withdrawals in full.
How to Get Tuition Insurance
Visit the bursar’s office webpage to check if your university has partnered with an insurance provider to provide optional tuition insurance coverage to its students. Purchasing insurance through your institution during tuition payment can enhance or expand the college’s current tuition refund policy. If your institution doesn’t offer insurance coverage, you can still purchase an insurance policy directly on the insurance provider’s website.
Tuition insurance is available to families and students up until the first day of classes. Tuition insurance is typically provided for one academic year at a time, so it must be renewed before each new term begins. Additionally, you might be able to buy insurance yearly, but you usually won’t receive any savings for doing so.