In their original 2009 insurance policy plan, GradGuard decided not cover student withdrawal in the case of a pandemic. But as COVID-19 made its grip on the nation clearer, GradGuard’s CEO and co-creator John Fees decided he needed to rewrite the rules. During 2020, GradGuard was the only tuition insurance plan that fully reimbursed student withdrawals due to COVID-19.
GradGuard is a program manager that sets students up with insurance that covers 100% of their tuition, room, board, and school fees should that student need to withdraw due to physical injury or illness, chronic illness, or a mental health condition. Most institutions do not offer any return on investment should a student drop out after the first few weeks in the semester. With the cost of higher education continuing to rise, the risk taken by low-income families to invest in higher education has become more serious.
“The reality is, once you’re three-to-five weeks back into the term, they won’t give you money back,” said Fees. “Most don’t provide academic fee refunds. No schools provide refund for housing.”
“It’s gotten to the point where schools themselves are financially stressed. They’re not in the position to provide refunds. They’re counting on the cash flow from that semester,” said Fees. “[Schools] are a business and they operate like businesses, more than people realize. As a result, insurance is a practical alternative, and we’ve seen extraordinary growth.”
GradGuard has partnered with over 400 institutions, including historically Black colleges and universities like Howard University, Dillard University, Morehouse College and Prairie View A&M.
GradGuard is not the first company to offer risk assurance. A.W.G. Dewar has been offering insurance for elite or high-cost schools since 1930, and they are still partnered with some of the biggest names in higher education: Rice University, Columbia University in New York, Duke University, Georgetown University, and Yale University to name a few. But the Dewar plans do not ensure repayment at 100%.
Some Dewar partners, like Fordham University, offer a flat rate fee to insure its undergraduate students. June 2021’s cost is leveled at $620 a semester per in-resident academic year.
