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Definition: Tuition Insurance
Tuition insurance is a type of insurance that protect student attending school, college or university against financial loss occurring from involuntary withdrawal from the education. This help the family recoup some or all of the money invested if the student has to leave the institute midway through the semester.
In order to file reimbursement, the student/ parent/ guardian has to prove that the reason for withdrawal is an uncertain event ice, medical reason or death of student's legal guardian. Different schools have different conditions to be honored like job loss, illness or death to apply for reimbursement. Tuition insurance will either refund or cover the cost associated with attending the institution. It may also cover education loan. It is the duty of parents, guardian and student to be aware of the things covered and conditions for reimbursement.
Tuition insurance has existed since 1930. It can be obtained either from the educational institute or from the insurance company. Student loan can also offer this as its component. Though it covers full tuition fees in times of withdrawal due to medical illness but in case of mental health the coverage may not exceed 60%.
Tuition insurance can be obtained if the probability of meeting the reimbursement condition is high. For example: if a student has a history of frequent illness, he may go for the insurance to cover the cost if he opts out. Tuition insurance benefits both since it covers interest of both the parties. The educational institute will still get its tuition fees even if the tuition payer is not able to pay it.