Insuring Education: COVID-19 and the Classroom

Bad news often drops on a Friday. There may be arguments against this convention, but when the University of Washington announced its move to online classes starting Monday, March 9, for the remainder of the winter quarter, the announcement took place on Friday, March 6.

President Ana Mari Cauce and Provost Mark Richards explained to faculty, staff, and students their focus to keep the community healthy while fulfilling their educational, research, and service mission: “Evolving public health recommendations indicate our best course of action is to take additional social-distancing steps to support the region’s efforts against this outbreak and conclude this quarter in an orderly and cohesive way for our students and instructors.”

Bad News Travels Fast

Following the announcement, the New York Times speculated that “other colleges around the country are preparing to follow if the virus becomes more widespread.” It did not take that long. By Monday, March 9, Amherst College cancelled face-to-face classes for the remainder of the spring semester. While there were no confirmed COVID-19 cases on campus, the college said the risk of having hundreds of people return from their spring break travels required precaution.

From there, the domino theory took hold. Vanderbilt, where a singular case tested positive, cancelled classes through the end of March. Princeton and Columbia reported moves to virtual instruction (beginning March 11 for Columbia and March 23 for Princeton).

More colleges reported closings before the Athens of America responded. Harvard asked students not to return to campus after Spring Recess (March 14-22), and to meet academic requirements remotely. Then MIT cancelled classes March 16-20 preceding its own spring break—giving “faculty and instructors two weeks to organize a full transition to online instruction.”

Pandemic or Pandemonium?

On March 11, the World Health Organization announced COVID-19 was officially a pandemic. In the words of its Director-General, “Pandemic is not a word to use lightly or carelessly. It is a word that, if misused, can cause unreasonable fear, or unjustified acceptance that the fight is over, leading to unnecessary suffering and death.”

Prior to this, University of Washington’s decision to go remote was swift but logical. The winter quarter concludes on March 20, and Washington state has (currently) over 450 COVID-19 cases (and 31 dead). President Cauce from the outset said, “We plan to resume normal class operations when the spring quarter begins March 30, pending public health guidance.”

Therein may lie a key difference between the University of Washington, and those that followed. By running on a quarter system, Washington can respond to the immediate crisis, and then reset for the next quarter—returning to the classroom setting or remaining virtual depending on the state of the pandemic.

That is not the case for many of the other schools listed above that run on semesters. For these colleges and universities, the interruption of their curriculum began just before or during midterms and will continue until May. Their students face uncertain housing situations (What do I need to pack? Where am I supposed to go? What if my native country is under quarantine?) while the institutions cannot reset until the following academic year.

“I Want My Money Back!”

It remains to be seen how the rest of this semester will play out for higher education, but one thing remains consistent: the high cost of tuition. U.S News & World Report lists the average tuition and fees in 2019-2020 for a private college at $36,801, with some institutions (like Yale) costing $55,000 for the year. Back in 2010, when the Wall Street Journal graded the value of tuition insurance, it observed that “Most colleges already offer refunds on a sliding scale through the first four weeks of each term. By late in the semester, a student would be more likely to take incompletes in classes than actually withdraw.”

When they followed up in 2018, the Wall Street Journal noted, “As college tuition rises so too has demand for insurance to cover what in many cases is among a family’s biggest investments.” John Fees, co-founder of GradGuard, went on record for WSJ saying 70,000 policies were written across the U.S. market in 2017, up from 20,000 five years before. Still, how often did students withdraw from their universities mid-semester?

That Was Then, This Is Now

Hopefully, by decentralizing their campuses, colleges and universities will reduce the transmission of COVID-19—“flattening the curve” as it’s being called. But doing so is at the expense of the academic environment students expect from the brick-and-mortar settings that provide residence and foster education at a cost.

Tuition insurance will cover the withdrawal of a student due to serious health issues, but not for academic reasons well into the semester. And the significant expense for even one semester of disrupted education can compromise a student’s GPA as well as the standards imposed on the school to deliver “their educational, research, and service mission.”

Like the supply-chain disruptions in other verticals, there will be more questions than answers for higher education in the coming months. As colleges and universities address their business continuity/disaster recovery plans, insurers that offer tuition insurance will also need to reconsider the terms and conditions of an interrupted education. Questions best left to ask—perhaps—on a Friday.

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