DEFINITION of 'Tuition Insurance'
A type of insurance that allows families to recoup some or all the tuition paid should their child leave school midway through the semester. Tuition insurance is usually offered for students in elementary and secondary schools. Some companies also offer tuition insurance to students in public and private colleges. To file a claim for reimbursement, parents and students have to prove that the reason for withdrawing from school meets certain conditions, which might include job loss, illness, etc. Different schools have different conditions that must be met before a reimbursement claim can be honored and is the duty of the students and parents to be aware of these conditions.
BREAKING DOWN 'Tuition Insurance'
Before obtaining tuition insurance, families must remember that certain schools will reimburse part or all of a student's tuition if they withdraw by a certain date. Therefore, it is imperative that families of students look at the conditions required for filing a reimbursememnt claim and weigh the likelihood of meeting those conditions. For example, if a student has a history of poor health, tuition insurance might be something to consider, because the student might have to drop out of school due to serious illness. However, if this is not the case, the family might need to explore other college saving options besides tuition insurance.