How to choose annual travel insurance

Why do I need annual travel insurance?

• Annual travel insurance protects you and your family while you are on holiday. The main benefit of annual travel insurance is that it covers you for emergency medical treatment, which can be very expensive abroad, but it will also reimburse you for lost or stolen money and personal belongings.

Single trip or annual travel insurance?

• You can buy insurance each time you go away, but if you take two or more holidays a year then annual travel insurance could be cheaper.
• Annual travel insurance is particularly convenient if you like to take advantage of last-minute deals.

What cover do I need?

• At least £1 million of medical expenses cover in Europe and £2 million in the USA and the rest of the world, plus repatriation expenses. Fewer than 50 countries have reciprocal healthcare agreements with the UK and some of these provide only basic emergency treatment.
• Annual travel insurance with at least £1,500 for baggage and belongings that are lost, stolen or damaged.
• Cover for stolen cash of between £200 and £500, including travellers' cheques.
• Cancellation and curtailment. Most annual travel insurance will pay compensation if you have to cancel or cut short your trip because of illness or the death of a close relative.
• A 24-hour emergency helpline and cover for legal expenses.
• Personal liability cover of at least £1 million for any costs you incur as a result of you injuring someone, or damaging their property.

Europe or worldwide?

• If you plan to travel outside Europe, then you'll need worldwide annual travel insurance, which will cost more. You can usually add worldwide cover to a European policy at a later date, but this is a more expensive option.

Where can I buy annual travel insurance?

• You can buy annual travel insurance from many different sources, including insurance brokers, travel agents, tour operators, banks, building societies, the Post Office and direct from insurers.

Make sure you are fully covered

• If you are going on an adventure holiday or plan to take part in activities or sports such as skiing, motorbiking, scuba diving or whitewater rafting, then make sure you are covered for this. Your annual travel insurance may exclude "dangerous" activities, so do check before you travel.

Tip

Many students now take a gap year to go travelling. Annual travel insurance is essential for such a trip, and the good news is that some specialist insurers offer discounts to students. For the best deals, shop around on the internet.

And finally...

• Check cover limits and exclusions.
• Watch out for excesses (the part of the claim you have to pay).
• Read the small print and ask questions about anything you do not understand.