Many travel operators insist that you have cover before they'll sell you a holiday. They are entitled to do this, but they cannot demand you buy a policy from them, provided the cover you have is comparable.

Apart from covering items that may be stolen while you're on holiday, including small amounts of cash, travel insurance offers many other important benefits
Policies usually include cover for medical expenses - useful if you fall ill or if you're unfortunate enough to be attacked and injured. You must disclose any pre-existing medical conditions.
Travel policies also tend to include some basic 'personal accident' cover, paying a set amount in the event of loss of sight, limbs or injury resulting in permanent disability or death. Another important element is 'cancellation cover'. If you have to cancel your holiday because of injury, illness or a disaster at home such as a fire, this will pay for any holiday expense you cannot recover. You need to check carefully what is covered and what isn't.

Make sure your policy is valid for the whole journey and includes comprehensive medical and repatriation cover. Always take a photocopy of your policy, along with a note of any 24-hour emergency numbers.

Like all insurance policies there are restrictions. Limits to the amounts that will be paid under different parts of the cover usually apply and you won't be covered for dangerous activities, such as abseiling or scuba diving.

Also, a claim could be turned down if you don't look after your belongings properly. For example, if someone steals your things off the beach while you're taking a dip in the sea, the insurance company might decide that you have not taken 'reasonable care' and refuse to pay up.

Insurance companies are also growing increasingly concerned about fraud, especially with travel insurance. If you claim for anything that has been stolen they'll probably want evidence that you actually owned the item in the first place. Keep photos at home of personal belongings that you've taken with you. Some insurers even ask for receipts!

Check to see if you already have cover under your home insurance for personal belongings while travelling abroad or away from home in the UK. It might not mean that you will get a lower premium (try asking though), but it's worth knowing as the cover under your home contents may be better or may have a lower excess. If you have travel and household cover you cannot claim twice! Insurers will normally split the cost of a claim between them.

Don't forget the benefits of using your credit card to buy things abroad. Most include automatic insurance cover on items bought with your card for a short period of time, including things you buy overseas. Check with your card company.

Finally, if you and/or your family travel often, ask your insurance company about an annual policy. You pay a premium each year and are then covered for all holidays in that period without needing to take out individual policies - although you may be limited to a certain number of trips.