Single Trip Or annual Cover? This will depend on how many trips you are likely to make in a year. There are some excellent deals for single trip policies but if you are going to travel more than once in a year then you can get a multiple trip policy. This will cost more than a single trip policy however you will pay less than you would if you paid for insurance each time you travel. You do not need to travel 12 times a year for an annual policy to be cost effective, for example, an adult holidaying in Europe would only need to go 3 times in one year to save money.

If you are the kind of person who jumps on a plane at the last minute then you will not have to worry about insurance if you have an annual policy. However, if you will definitely only travel abroad once a year then the single trip policy is sufficient enough for you.

If you do need to make a claim, so you are not unpleasantly surprised make sure that you know of all the standard exclusions. Below is a guide that will give you all the knowledge that you need, so that you can check that all the policy features that are essential to you are there.

Baggage and money - This is usually set up to a certain amount normally around 1,500 pounds. The standard cover for baggage and belongings is against loss, theft or damage. Insurers will give you limits on individual items which is generally between 200 pounds and 500 pounds.

New for old - The replacement of items on a new-for-old basis means the insurer will either pay for the repair of damaged property or will replace an item that is destroyed or stolen.

Cover for money - There tends to be a limit on the amount of cash paid out so check each individual policy. These limits which are about 200 to 500 pounds depending on the policy will also include travellers' cheques.

Spectacles cover - Some insurers will not give cover to replace damaged or stolen spectacles so again check the policy.

Medical cover - If you have any pre existing medical conditions then travel insurers are very strict with regards to this. This is to the point that some will totally exclude cover for any previous condition. Others are more sympathetic. You should always be totally honest when it comes to health issues. You do not gain anything by not divulging any pre-existing conditions to an insurer.

Last year the E111 was replaced by the European Health Insurance Card. This means that you can get treatment in Europe if you need it. If you hold a current one (and watch out on this one-check the expiry date), then some insurers will also waive excesses.

Cancellation and curtailment - Your insurers usually will compensate you if you have to come home or cut short your holiday due to illness or death of a close relative.