Tuition insurance is designed to protect students’ and their parents’ investment in higher education. This protection is needed because most school’s refund schedules provide no refunds after the first few weeks of an academic term. Many students assume refunds are available throughout the academic term if a medical withdrawal becomes necessary, which is not usually the case.
Students and parents are not the only ones who will benefit from this coverage. Recent studies indicate that schools can also benefit from an increase in the long-term retention of students who need to withdraw for a semester due to medical reasons. For college administrators the medical withdrawal process is cumbersome. The appeals process and corresponding management of refunds can be subjective, difficult to manage, and costly. Now, and especially, since the COVID-19 pandemic, schools are looking for a uniform process for student withdrawals whether it be for medical or other reasons.
Tuition insurance is typically a voluntary product, meaning schools elect to offer it and students/parents decide whether or not they wish to purchase coverage. However, an alternative option is auto-enrollment. This process effectively resolves the medical withdrawal quagmire many schools find themselves having to navigate. Under this arrangement, all students are automatically enrolled in tuition insurance based on the average cost of attendance. Students then log into a website provided by their tuition insurance carrier to acknowledge that they have reviewed the school’s refund schedule and have decided to opt-out of coverage.
How does an auto-enrollment process benefit colleges and universities?
- It protects the college because an online record is created of all students choosing to opt-out of coverage confirming that they have reviewed the school’s refund schedule.
- It greatly reduces the need for a separate appeals process for medical withdrawals saving administrators time and money.
- Auto-enrollment reduces the cost of coverage making it even more affordable for students to protect their higher education investment. This is an important benefit when you consider that 56% of students surveyed in June 2020 said they could no longer afford their tuition.
- The process is simple – one cost for all students. The premium is added to the student’s tuition bill and the college remits premium to the insurance carrier.
An alternative to full auto-enrollment is a partial or hybrid enrollment process. Under this arrangement, a fixed amount of coverage is universally offered (for example, $10,000) and the student can either opt-out or buy-up additional coverage on a voluntary basis.
Whether voluntary, full, or partial auto-enrollment, your students will have options and will be able to have coverage at an affordable cost.