In just weeks, students will be heading off to college to start their fall semesters. That means the reality of soaring costs.
Paying for college can be a huge financial commitment, seeing as the average cost of tuition fees for in-state schools can reach as high as $20,000 per year and, for private schools, $45,000 per year.
But what do you do when life happens, like you get terribly ill or fall onto hard times, and cannot finish paying for your education?
There's now a way to take some of the stress out of it.
It’s called College Tuition Insurance, and it can be a backup plan for students if something happens.
It's something that interests Johnasay Sumlin, a nursing major at Cleveland State University. She says college is already expensive and schools offering insurance is a good idea.
“I think that that would be helpful, it will lift some of the burden off, so you won’t be that worried about it,” she said.
Like a lot of students and their parents though, she doesn't know much about student loan insurance.
The insurance, which is offered by many schools across the country, mainly through third parties sellers like A.W.G and GradGuard, allows students a financial help if they fail out, get expelled, or get a chronic illness like cancer during the semester. At that point, the insurance will kick in.
It covers some or all the cost of the tuition paid. Sounds like a great deal, right?
Well, financial experts say the devil is in the details, you must read the fine print on your policy to make sure you know exactly what your coverage is like because they’re all different.
In addition, Kathy Ruby, College Finance Expert with College Coach, says you could be paying for the insurance unnecessarily.
“Colleges are required to publish their refund policies, so you want to make sure you understand what the college will refund anyway before you worry about buying insurance," she said.
She warns people to find out how much the insurance actually covers. Some cover 100 percent, others only cover 75 to 90 percent.