By Degree Insurance
Degree Insurance is the first product that can guarantee the outcomes of students in the five years following graduation.
The students applying to college today represent the least confident generation in American history. They were old enough to remember the great recession, the fear, the job loss, and the impact of the economic changes. And now, when it’s their turn to enroll in college and invest in their futures we experience a global pandemic the likes of which we haven’t seen in 100 years. Colleges are delivering courses online. Students are asking, “Is it worth it?” “Will my degree come with an asterisk?” and perhaps most importantly, “Will there be any jobs when I graduate?”
It’s a tough spot to be in, being asked to borrow 10 or 20 times your net worth, make a single investment with it, and then just…hope. Hope that it works out. Hope that employers will be hiring. Hope that the costs aren’t too great. Hope that your efforts will be worth it.
Degree Insurance answers meets their hope with a promise – that it’ll work for them. That college will lift them up. We give students that confidence by guaranteeing their earnings in the 5 years following graduation. We put a voice in their head that says, “It’ll work. It has to work for you. You’ve got a guarantee. All you have to do is finish!”
Degree Insurance offers the first guarantee for student outcomes ever to come to market. When a college purchases our insurance we give a guaranteed earnings level based on major. We might, for instance, be able to guarantee that Engineering majors from a particular college would earn $56,000 a year while Business majors would earn $42,000 and Dance majors $33,000. These insights into the impact of major choice can help students make better decisions – not always by seeking salary – but by optimizing for their own happiness given the likely outcomes.
Not every student should go to college. But those that do need to graduate. When 40% of new college freshman drop out, we’ve actively made 4 in 10 new students at our colleges poorer – not wealthier, for having attended. More than half of student loans that are in default are held by one-time students who borrowed less than $10,000 but never graduated and haven’t been able to out earn their payments.
Increasing our graduation rates should be priority one for colleges, and Degree Insurance helps meet that need. In a shrinking market for students, colleges that can offer a certain future are going to fare better than those who can only offer platitudes and probablies. That competitive advantage means more students enrolling, better yield and a higher graduation rate. It means that schools get better at meeting their mission and serving students. And it means America gets more innovators, educators, doctors, engineers and lawyers.