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Insurer QBE has launched the only dedicated school fee insurance product in Australia. The product, School Fee Protect Insurance, covers for parents who become involuntarily unemployed or suffer an injury or disability against the risk of defaulting on the school fees of their children.
Eleanor Debelle, QBE general manager for consumer, affinity, and banking partnerships, said QBE's new product could give parents peace of mind.
“One third of all Australian school students, or 1.3 million children, attend a private school – where fees have risen an astounding 64% in the last decade,” Debelle said. “This is creating enormous financial stress on ordinary families who pay between $6,000 and $40,000 a year to send their children to non-government schools. Those parents will now be able to take out school-fee insurance as a safety net if they lose their job, have an accident, or get sick. Consumers have always been able to insure their house, car, boat, and even their pet, but until now they haven’t been able to insure private education, which is often the second most expensive household spend after the family home.”
Johnny Marchant, founder and managing director of School Fee Protect Insurance, said the product was developed in consultation with many headmasters and bursars from a wide range of fee-paying schools.
“The overwhelming reaction has been that this is an incredibly useful initiative for both schools and parents in the current economic climate," Marchant said.
The insurer suggested that the School Protect Insurance may be the better option than income-protection insurance when it comes to protecting against the risk of defaulting on the school fees.
Unlike income-protection insurance, which may have lengthy waiting periods, will adjust benefit payments should you receive other income, and often excludes dangerous or hazardous occupations, School Fee Protect Insurance will pay benefits in addition to other income, has no waiting period, and does not consider occupation type, QBE said.
