Tuition refund insurance is not a widely discussed product. However, in talking to parents, we’ve discerned that it helps put to put parents’ minds–and finances–at ease.
Sometimes, college life brings bad luck. Speaking personally, I’ve had multiple friends have to take a semester or two off from school. In some situations, they were responding to the death of a family member, in others because they were dealing with a mental health situation, and in others because of a truly freakish snowsledding accident. Life happens, and with life comes risk.
It’s hard to think of students as being at risk, but the best data indicate that the risk exists.
Proportion of college studens who reported being diagnosed or treated by a professional for any of the following health problems within the last 12 months:
- Broken bone/fracture/sprain: 6.9%
- Bronchitis: 5.8%
- Diabetes: 1.1%
- HIV infection: 0.3%
- Migraine headache: 7.6%
- Mononucleosis: 1.6%
- Strep throat: 9.7%
- Tuberculosis: 0.4%
- Attention Deficit and Hyperactivity Disorder (ADHD): 7.6%
- Chronic Illness (e.g. cancer, diabetes, auto-immune disorders): 4.6%
Health Stats from ACHA-NCHA II Fall 2013 Executive Summary.
- 31.3% of all students surveyed stated that they felt so depressed that it was difficult to function at some point during the past 12 months.
- 21.6% of all college students reported being diagnosed with or being treated by a professional for at least one mental health condition (including psychiatric problems, addictions, and eating disorders) within the last 12 months.
- Proportion of college students who reported having a psychiatric condition: 5.7%.
- 12.9% of college students surveyed report having been diagnosed or treated by a professional for anxiety within the last 12 months.
- 11.0% of college students surveyed report having been diagnosed or treated by a professional for depression within the last 12 months.
- 7.6% of all students report having both depression and anxiety.
Health Stats from ACHA-NCHA II Fall 2013 Executive Summary.
A randomly selected sample survey on college bereavement found that…
- 1.7% had a parent pass away over a 24-month period.
Source: Balk, DE, AC Walker, and A Baker. “Prevalence And Severity Of College Student Bereavement Examined In A Randomly Selected Sample.” Death Studies 34.5 (2010): 459-468. CINAHL Plus with Full Text. Web. 28 Jan. 2013.
Sadly, these risks can lead to students withdrawing from college (either for a time or permanently):
A recent study asked students about the type of life shocks that could cause them to withdraw from college. It’s amazing the wide range of events that could factor whether or not a student finishes a bachelor’s degree.
- 52.9% indicated ‘becoming ill.’
- 18.4% indicated ‘death or illness of a family member.’
- 10.6% indicated ‘became clinically depressed.’
- 5.5% indicated ‘experienced significant injury.’
- 10.9% indicated ‘theft.’
- 13.2% indicated ‘large increase in tuition/living costs.’
- 13.2% indicated family member lost job/family in need of financial help.’
Pleskac, T.J., Fandre, J.*, Merritt, S., Schmitt, N., & Oswald, F. (2011). A detection model of college withdrawal. Organizational Behavior & Human Decision Processes, 115, 85-98
NAMI College Students Speak:
- NAMI’s national survey reports on the experiences of college students living with mental health conditions.
- Of survey respondents, sixty-four percent of those students who have stopped attending college are no longer attending because of mental health related reasons. The primary diagnoses of these students are depression, bipolar disorder and posttraumatic stress disorder.
In Virginia, 56 students per public college withdraw each year for mental health reasons… a number that the same study warns might be too low/underreported.
- (Report on the Virginia College Mental Health Survey, Conducted by the Joint Commission on Health Care)
Spring 2012 Student Monitor Financial Services Survey: ‘In the last 2 years I have or have a friend who has…’
- 12% had to withdraw from school in the middle of the semester for a medical emergency or death in the family.
What happens when a student withdraws? College finances may be at risk.
In 2010, we studied how 215 colleges processed refunds of tuition with regard to a withdrawal for medical reasons. The results? Families, while they may get a partial refund, are rarely able to access a full refund of tuition and fees (not to mention housing, board and book costs!).
- 46% of schools studied have a policy that stipulates that those students not receiving financial aid who file for medical withdrawal receive 0% after 5 weeks with no appeal.
- 145 colleges and universities (67% of schools studied) refund only 50% (or less) with no appeal.
- College Parents of America Study: Tuition Refunds for Medical Withdrawal and Tuition Insurance Availability among 215 Institutions of Higher Education
Aside from the possible financial strain on a budget, the biggest problem is parents just aren’t aware of this financial risk.
According to the the 2013 Report on Parent Survey of Risk and Concerns, designed by College Parents of America:
- almost 66% of parents have no idea how their student’s school would handle a medical withdrawal; and
- less than 33% of parents recalled being told about the school refund policy.
So, why tuition refund insurance? Because it was designed specifically to help limit the financial strain of a catastrophic event that interrupts a student’s college education.
While not every family needs to cover the full amount of their college costs (for example, due to scholarships and grants), it’s likely every family could benefit from at least a small amount to protect against the possible full or partial loss of college-related costs like tuition, books, meal plans and housing costs.
So, that’s why College Parents of America includes tuition refund insurance as part of its membership. We see at least a little bit ot tuition refund insurance as valuable protection for any parent, any student, and any wallet.
