Administrators at higher education institutions are bracing for another year of heightened challenges. Everything from financial instability, campus safety threats, mental health concerns and the rapid integration of artificial intelligence is here to stay—for now. These risks demand proactive strategies and a forward-thinking approach. Schools that prioritize risk management and operational resilience will be better equipped to navigate 2025’s complex landscape.
Navigating emerging risks while facing financial uncertainty
Rising operating costs for salaries, campus safety, technology, insurance and facilities maintenance are compounding budget challenges. Declining enrollment—which dropped 10% between 2012 and 2022—further exacerbates these issues. This trend, often referred to as the “enrollment cliff,” highlights the ongoing challenges higher education institutions face as declining birth rates, reduced confidence in the value of a college degree and rising tuition rates converge to impact enrollment projections.
Concurrently, universities face growing risks such as infrastructure vulnerabilities and liabilities related to campus safety, with increased costs, business disruption and cyberattacks are the most pressing threats to financial stability. Alarmingly, many administrators do not have an action plan or resources to address these risks nor adequate risk mitigation or insurance coverage to protect against cyber incidents.
Because educational institutions manage extensive volumes of sensitive data, it positions them as attractive targets for cyberattacks. To reduce the risk of devastating consequences, it is essential to enforce robust device and network security policies while maintaining a well-prepared crisis response plan.
Administrators must also stay alert to threats such as active assailants and student protests. Partnering with education-focused insurance specialists can support the development of comprehensive campus safety protocols, address risks like sexual violence and strengthen crisis response strategies.
Prioritizing faculty retention through benefit enhancements
Faculty stress and burnout significantly impact institutional performance, with 60% of higher education faculty experiencing anxiety or depression and over half considering leaving the profession. Administrators must address these challenges to maintain a stable and productive workforce.
Low morale and high stress levels have significant implications for productivity and retention. While salary competition with other industries is challenging, administrators at institutions can differentiate themselves through robust and personalized employee benefit programs.
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Benefit strategies gaining traction include mental health support, auto-enrollment in benefits programs and lifestyle insurance offerings. Workforce analysis can help institutions tailor benefits to meet faculty needs, enhancing recruitment and retention.
Navigating financial, compliance and power shift challenges
Additionally, the evolving Name, Image and Likeness, or NIL, regulations present both opportunities and risks for higher education. While student-athletes can now monetize their brand, the intricate web of state laws and NCAA guidelines poses complex compliance challenges that institutions must navigate with precision.
From a risk management perspective, NIL is altering the flow of institutional funding. Donor priorities may increasingly shift toward supporting individual athletes, potentially at the expense of broader university initiatives. Furthermore, the rise of NIL collectives and representation by agents exposes student-athletes—many of whom are inexperienced in financial matters—to risks such as tax errors, legal disputes and reputational damage.
The introduction of NIL has also disrupted recruitment dynamics, leading to increased athlete transfers that can destabilize team cohesion and funding models. Combined with NCAA revenue-sharing mandates, these shifts impose growing financial pressures on universities across the country.
To address these challenges, administrators must implement comprehensive policies that ensure compliance with regulations. Exploring private equity partnerships can provide innovative solutions to bridge funding gaps and maintain financial stability.
Protecting your institution’s reputation and resources
Strengthening organizational resilience is essential for higher education administrators to safeguard their institution’s financial health and reputation. Key focus areas include:
- Cybersecurity: Administrators must adopt rigorous cybersecurity protocols, including training, to protect sensitive data and have incident response plans ready.
- Campus safety: Developing robust plans to address both everyday and evolving threats such as sexual abuse, active assailants, protests and campus unrest is crucial. Administrators should collaborate with insurance specialists to establish safety protocols and crisis response strategies.
- Artificial Intelligence: Administrators should implement AI governance strategies to harness its benefits while mitigating risks to academic integrity and operations.
- Mental health support: Rising rates of severe anxiety, depression and stress among faculty, staff and students underscore the need to provide comprehensive mental health services such as access to therapy and covered medications.
Make a plan
To succeed in 2025, administrators at higher education institutions must embrace comprehensive strategies tailored to their unique challenges. Here are four ways:
- Develop a comprehensive risk plan. Use Enterprise Risk Management to identify exposures and ensure strategic and efficient risk mitigation. Partner with a broker who possesses the expertise to assess risks and identify coverage gaps in your current policies.
- Create a personalized benefits strategy. Faculty increasingly seek comprehensive support for their health and well-being. Focus on quality employee experiences to enhance engagement and retention as well as minimize organizational risk.
- Assess risk regularly with your broker. Regularly review exposures and insurance needs to secure optimal coverage. Start assessing exposures and insurance needs 90 days before renewal.
- Leverage broker expertise. Work closely with carriers to manage crises effectively and optimize coverage. They can support legal counsel, digital forensics and related challenges. Their expertise can help mitigate reputational harm and accelerate recovery efforts.
Building resilience with proactive strategies
In 2025, higher education administrators face a pivotal moment—one that demands proactive leadership and innovative solutions. To pass the test on risk management, administrators at educational institutions must develop a new curriculum. With strategic planning, collaboration and a commitment to adaptability, higher education can not only weather the challenges of 2025 but emerge stronger and more prepared for the future.