New School Year, New Realities: How Higher Ed Leaders Can Navigate Risk in 2025

By: Heather Richmond

The start of a new fiscal year brings new regulations, expectations, and realities for higher education. This fall, leaders will need to think differently and strategically about risk mitigation. I recently attended NACUBO’s Annual Meeting in National Harbor, MD, where several sessions focused on the top risks facing institutions today.  

Enrollment Uncertainty

The long-anticipated demographic cliff, driven by lower birth rates since the Great Recession, is expected this fall. Institutions are being squeezed from multiple sides: shrinking student populations, reduced international enrollment, and rising operational costs. As presenters emphasized, every dollar matters, and for many CFOs, making payroll is what keeps them up at night.  

One of the biggest challenges for higher ed leaders is the uncertainty surrounding international students. A July survey found that while most international students are still interested in studying in the U.S., thousands of student visas have been revoked, and opportunities are becoming harder to secure. Data modeling by NAFSA predicts a 15% drop in international student enrollment, while Shorelight estimates the decline could be closer to 20%, costing U.S. colleges and universities more than $1.7 billion in lost tuition annually or $5 billion over four years.

This is where financial safety nets like tuition insurance can play a role. Protecting tuition revenue not only helps institutions manage enrollment uncertainty but also builds trust with families who want confidence that their investment can be protected if their student must unexpectedly withdraw for a covered reason. 

AI as a Tool, Not a Threat

Another phrase from one of the sessions that resonated with me was: “There’s no such thing as a zero-risk environment.” Institutions can’t eliminate all risks, but they can take steps to mitigate them. 

Artificial intelligence is a perfect example. While many administrators worry about AI being misused in classrooms or replacing jobs, the real opportunity lies in leveraging AI as a tool to assist, not eliminate. 

Staffing shortages remain a reality in higher education, and many manual processes drain valuable time and resources. AI can help streamline these tasks. Imagine being able to automatically review and organize thousands of Certificates of Insurance (COIs) instead of relying on staff to sort through them manually. The good news is that many of these tools can integrate into the technology your campus is already using. For instance, GradGuard’s Tuition and Renters Insurance Programs are integrated into billing and housing systems, and the COIs are managed through a central platform providing administrators with visibility. 

However, when you are evaluating these tools, be sure risk managers have a seat at the table. Their perspective helps ensure AI adoption balances innovation with risk mitigation, enabling institutions to make educated, strategic choices without avoiding opportunity. 

The Real Cost of Deferred Maintenance 

Deferred maintenance isn’t just about campus buildings; it’s also about technology. Leaders often focus on immediate budget pressures rather than the long-term cost of waiting. A 50-year-old building with an aging HVAC system presents a clear, quantifiable expense when it fails. But delayed technology upgrades are harder to measure until a security breach, compliance issue, or system failure occurs, and by then the cost is much higher. 

Delaying maintenance costs more in the long run. Institutions that put off digital transformation not only face higher expenses later, but also risk falling behind in security and student expectations. 

Insurance can play a role here as well. Offering renters insurance with liability coverage not only can help students protect their belongings, but also help institutions protect capital investments in buildings. Yolonda Blackshire, Assistant Director for Housing Business Operations at Sacramento State University, shares how the school implemented GradGuard Renters Insurance after a student who did not have renters insurance accidentally set off the sprinkler system that caused water to run down four floors.

Reputational Risk: Trust is on the Line

Beyond financial costs, reputational risk is just as significant. Students and families expect transparency, fairness, and support, especially when unexpected events disrupt their education. 

The challenge is most schools aren’t able to refund tuition beyond the first few weeks of classes, even for serious medical reasons, let alone the cost of housing and fees. While this may be outlined in refund policies, families are often caught off guard when facing tens of thousands of dollars in unexpected losses. 

Many institutions have created refund appeals committees to handle these cases, but administrators frequently describe them as emotionally taxing and time-consuming. Decisions on who “deserves” a refund are inherently subjective and can strain relationships between students and their schools. Offering solutions like tuition insurance removes much of this burden. By providing the option, schools demonstrate that they care about student success and financial wellness. This proactive approach builds trust and strengthens the institution’s reputation at a time when higher ed credibility is under more scrutiny than ever. 

It’s important for administrators to translate potential risks to students and families and include ways they can protect themselves, such as with tuition or college renters insurance. GradGuard’s programs are optional and promote financial wellness by informing students about their institution’s existing refund policy and allowing them to make an active choice to protect themselves with a plan or decline coverage. Tim Riley, Bursar at Purdue University, shares how administrators want their students and families to make the best, most informed decisions for themselves after understanding the school’s refund policy and learning about the benefits of GradGuard Tuition Insurance. 

Final Thoughts

The new school year brings with it a landscape of uncertainty: declining enrollments, policy shifts, financial strain, and technological change. While risks can’t be eliminated, they can be managed. 

By strategically embracing tools like AI, investing in proactive maintenance, and taking a platform approach for offering resources like tuition and renters protection, higher education leaders can better navigate these challenges while protecting both their institutions and the students they serve.