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Sean Coughlan figures out your finances every fortnight.

The holidays are almost here; it's time to dust off your passports and take half-forgotten summer clothes out of hibernation as the Easter migration begins. If you're off on holiday, will travel insurance be on your checklist of things to do?

There's no shortage of reminders, because when you're booking a holiday, flight or car hire, every person you speak to seems to want to sell you insurance. The fiercer the competition over the price of tickets, the more important it becomes for companies to plump up their profit margins with extras, such as insurance.

But what kind of value do these deals represent? And how do they compare with the stand-alone travel cover from traditional insurers?

At first glance, travel insurance policies look similar, offering cover against a list of holiday disasters, such as theft, illness, cancellations, lost luggage and delays. Going for the cheapest option might seem tempting. But check the levels of cover on offer, because insurance policies are specific contracts - and you won't get a penny more than is mentioned in the small print. With travel insurance, the devil is in the detail.

There might be a promise of theft cover, but if there's a maximum claim limit per item, it won't be much use if expensive jewellery or a laptop is stolen. Or there might be tens of thousands of pounds of medical cover included, but if you're in the United States and go to hospital, you could face a bill in the hundreds of thousands. So compare policies.

It doesn't mean that you're covered because someone sells you insurance. If you have a medical condition you should ask how this affects any rights to make a claim.

There are also likely to be exemptions on hazardous activities and sports, so if you go water-skiing and break your leg, there's no certainty that you will be covered - although you can pay supplementary charges if you want cover for risking life and limb. Definitions of what is dangerous vary, and might include riding a motorbike.

If you're offered insurance as a side-order, take a good look at what you're getting for your money. And before signing anything, compare the travel company deals with the policies offered by specialist insurance companies. You're under no obligation to take the insurance offered as part of a package - shopping around should bring savings.

The specialist insurers will perform the same balancing act between the cost of a policy and the amount of cover it provides, and there will be similar lists of exemptions. But in general terms, you should be able to find a better deal by buying your own policy rather than taking what's offered with a holiday.

If you travel regularly, consider getting an annual insurance package, which will be cheaper than buying a series of separate policies. These can be bought for families and for individuals.

You may as well get a policy that is tailored to your particular needs, based on factors such as where you're going and any particular anticipated risks when you are there. This is going to be more useful than the one-size-fits-all policy being flogged alongside a package holiday.

If you want to avoid ending up with less cover than a string vest in a snowstorm, look beyond the price and check the details.


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