Detailed Guide to Travel Insurance

When you go on holiday you always take your passport, tickets and money. Another thing you shouldn't forget for a pleasant and full of good memories holiday is your travel insurance.

If you happen to fall ill or experience an accident, this will pay for the extra costs that will incur and you will be able to go back to you holiday or travel home at no extra charges. Travel insurance will also be helpful if you happen to cancel your holiday due to some unforeseen circumstances such as the airline gone bust or you are left without a job.

What is covered?

There are great variations in the levels of travel insurance policies so add on carefully to match your needs. The basic features are:

- Cancellations -- if you happen to cancel or return home before the end of your holiday you can expect your cover to pay out. This will be the case only if the reason for this cancellation is you or a member of your family. For example, if you or a relative falls ill you will be covered but you won't be if your best friend needs your care.

- Delays -- If you experience more than 12 hours flight delays you will receive compensation. You need to have a written confirmation by the airline of the delay.

- Luggage -- you can claim up to £1,500 if your luggage is lost, stolen or damaged. Insurers usually set pay out limits on certain items such as laptops or cameras.

- Liability -- if you hurt accidentally someone or damage someone's property and they claim against you, the insurance company will take care of the costs.

- Emergencies -- most insurance companies offer nonstop emergency helpline to assist you in such cases no matter where in the world you are.

- Medical expenses -- If you fall ill or have an accident on your holiday, all medical expenses up to a certain amount (specified in your policy) will be payed out by your travel insurance provider.

Annual or single trip cover?

If you are a regular traveller annual cover would be the better option. It will work out cheaper for you if you have more than 2 trips a year. Also -- another good point on the side of the annual cover - the cancellations, luggage and medical payout limits are higher on an annual travel insurance policy.

Types of travel insurance

There are different holidays involving different activities and risks and that's the reason travel insurance is divided into types.

1. Backpackers insurance -- on a single trip policy your will be covered for a period of up to 31 days. If you want to extend you go for a 3 to 18 months cover and cross multiple countries.

2. Family insurance -- sometimes the cover might be free for the kids but be sure to read through the policy. Excess might be applied to all family members and could turn out quite expensive if you need to pay yourself in case of a payout.

3. Winter sports or adventure travel insurance -- this type of insurance is considered more risky and some providers avoid taking up such policies. Expect the premiums to be higher priced than regular ones. But the extra cost is often worth it for just in case.

4. Elderly travellers' insurance -- some companies won't insure elder people -- over 65 or put quite costly premiums.

Where to buy?

You will usually be offered travel insurance when you book your holiday by your agent or your airline company. If you haven't opted for one then consider going online and visit InsureAndGo, StaySure, MoneySuperMarket for competitive prices on travel insurance.