Travel Insurance - Your Ideal Holiday Companion

Whether you're staying in this country - or heading to sunnier shores - you may be picking out a new pair of sunglasses or stocking up on sun-cream, but one thing you must remember to pack in your luggage is a travel insurance policy.

This is vital to ensure you don't end up out of pocket if you have a problem with your transport arrangements, or if any of your belongings go missing.

Further, if you have to cut short your holiday or cancel for any reason, insurance will mean you claim back some of the costs.

Don't know what kind of insurance is best for you? Then read on for our guide to cover...

Shop around

When buying travel insurance, it makes little sense to pay more than necessary by buying from a travel agent - especially as finding a great deal is so simple online.

Not only is shopping around quick and easy, but it also enables you to directly compare levels of cover and cost from a wide range of providers.

Nonetheless, the cheapest option isn't always the best, so make sure you read the small print before taking out a policy - so you know exactly what you're covered for.

Level of cover

When you buy a policy, check the limits that your insurer places on each type of claim. As a guide, you should aim to take out a policy offering at least £2m of medical expenses cover, £1m for personal liability, £3,000 cancellation cover and £1,500 for baggage.

If you think your travel plans could be subject to change, then check the cancellation cover, as some policies do not automatically include this.

Also note that some policies will also protect against redundancy, home emergencies and airline failure, so take the time to read the Ts and Cs.

Single or annual?

If you go away more than twice a year, you can make savings by buying an annual rather than a single-trip policy, but be aware that some of these will limit the number of consecutive days on which you can travel in one trip.

Make sure you check this before you sign up, and be prepared to purchase an extended annual policy if you're planning on going on holiday for more than 30 days.

At the same time, if you're only planning to travel to the continent, consider getting Europe-only cover, as this should work out cheaper than a worldwide policy.

EHIC

If you are travelling within the EU, make sure you carry a European Health Insurance Card (EHIC). This card, which replaced the E111, entitles you to a degree of reduced-cost (and occasionally free) treatment brought about by accident or illness.

The cards themselves are free, and you can apply at www.ehic.org.uk. Please note however that the level of cover available varies between countries, and the card won't cover you for major expenses, such as an emergency flight home. As such, the EHIC should not be seen as a substitute for comprehensive travel insurance.
Adventurous activities

Adventurous activities such as bungee jumping or white water rafting are growing in popularity, but note that some insurers classify these as dangerous sports - which means you may not be covered if anything goes wrong.

Check with your insurer whether you can pay extra to cover such activities, and make sure you read all the exclusions.
Check for Foreign Office warnings

When taking out insurance, make sure the policy covers all the countries you want to visit, and remember that no insurer will pay out claims relating to countries that the Foreign and Commonwealth Office (FCO) has advised British travellers not to visit.

For more information go to www.fco.gov.uk for an up-to-date list.

Read more travel tips at http://www.confused.com/travel-insurance