These days, with last minute flights and holiday bookings it can be easy to overlook a vital component of your holiday - the insurance. For many, an annual policy works out best, especially if you make a lot of trips throughout the year, for others, a single trip policy is better. Misfortunes on holiday can be tiny or titanic, and a comprehensive insurance policy is vital to cushion you from the possible consequences.

Annual or single trip policy?

If your holiday (and business) pattern is for several short trips a year then an annual policy may be the best option for you, as you will be covered for a full 12 months and only need to remember your renewal date. However, if you only go once a year, for that hard earned and saved for fortnight in the sun, a single trip policy would be better value. Do some research on the internet before deciding on your insurer. As a rule of thumb, you will get a much better deal by going direct than by buying through a travel agent. An hour's research could save you a lot of money!

There are excellent deals to be had on both types of policy. Multiple trip policies cost more initially, but would work out cheaper than buying just 3 single trip policies to Europe over a year. Consider how many times you are likely to travel abroad and select the right type of policy for you. Our guide will help to make you aware of things like “standard exclusions” so in the event of you needing to make a claim there won't be any surprises.

Important policy features: -

Medical Cover – Always, always tell your prospective insurer about any pre-existing medical condition. For example if you have diabetes and take medication, tell the insurer. Some may not accept you for cover, but if you fail to divulge the information, any claim will quite probably be refused. Shop around and get a policy that covers you properly. It may cost a little more, but will be worth it.

If you are travelling to Europe, a European Health Insurance Card will allow you to get treatment in Europe if needed. This card is not intended to replace a travel insurance policy, but some insurers will waive excess fees if you have them.

Baggage and belongings – Normal policy limits set the figure for this at 1,500 pounds, providing cover against loss, theft and damage.

New for old – If an insured item is stolen or destroyed your insurer will replace it, or pay for repairs if something is damaged.

Valuables – Most policies place limits on individual items of between 200 to 500 pounds within your policy cover.

Prescription glasses – check policy details carefully. Some insurers exclude spectacles completely, so you won't be able to claim if they are lost or stolen.

Currency cover – Limits are usually set at between 200 to 500 pounds in the event of theft or loss of currency, which also generally include traveller's cheques. Check your policy wording for specific details.

Cancellation of your trip – your policy should compensate you in the unfortunate event of you having to cancel, or cut short your trip, due to the serious illness or death of a close relative or partner.