The recent volcanic ash fiasco caused uproar for many people, in an array of circumstances.

Those that followed the news around the volcanic ash cloud would have see that it caused massive disruption to travellers, after a ban was enforced across UK airspace.

However, this was only scratching at the surface of the problems to come, as many of those affected came to realise when reading the small-print on their travel insurance policies.

A number of insurance companies refused to foot the bill for any extra expenses incurred as a result of the ash cloud that spread itself across a large area Europe, either based on the terms of their insurance policy, or the insurer’s interpretation of the wording provided.

Every year, around 23 million travel insurance policies are taken out by travellers.

Getting the right level of cover

Popular high-street brands tend to focus on standard, simple risks that can be offered at a lower cost and are easier to provide cover for than the higher risk categories.

However, a number of online only products have been known to provide minimal cover.

This has left many of us feeling confused about how to opt for a policy offering the cover that is actually required, to avoid buying something we will later regret.

You may be under the impression that all policies are similar, but don’t be fooled. With some 165 different brands offering varying terms and a number of different levels of cover to choose from, it is important to buy a policy that suits your needs.

Travel insurance policies cover eventualities in at least 20 different sections, from skiing piste closures to pet passports.

Consumers must be able to differentiate between the best insurance deals and the “bare bones” economy policies that could leave travellers in quite a predicament should they need to make a claim.

But it isn’t as easy as simply searching for the best rates, as everyone is different, so the golden rule for finding the cheapest insurance policy that has everything you require is to consider your own personal circumstances.

For example, how expensive is the laptop you will be taking with you?

Will you be cruising around the Caribbean on an expensive cruise, or simply crossing the Channel on a day-trip?

Are you likely to be jet-skiing while on holiday?

Top three travel insurance claims

The top three categories that brunt the majority of travel insurance claims start with medical, making up 57% of all claims, followed by cancellation and lost luggage.

Insurers have mixed attitudes when it comes to pre-existing medical conditions.

For example, some will readily accept those that suffer from diabetes, while others might charge a higher premium, or even reject the risk completely.

It is very important to disclose all details to the insurer using the medical screening line when applying for a quote. Leaving out any pre-existing medical conditions could be an expensive mistake.

If you do suffer from a medical condition and find your quotes appear to be high, you can contact the relevant charity as they may be able to recommend a suitable insurance provider.

Many insurers will not cover those affected by a pandemic, which includes swine flu if this was the case.

Some insurers will also void claims that are related to any alcohol-induced injuries, so if you are partial to a few alcoholic drinks while away, you should keep this in mind.

Cancellations

Cancellation or curtailment of a holiday makes up 32% of all travel insurance claims, with limits varying greatly between insurers.

It is very important to understand that any policy bought will cover the cost of irrecoverable deposits. For example, a £2,000 cancellation limit is unlikely to cover the cost of a Caribbean cruise.

However, policies do not tend to cover every eventuality, for instance a volcanic eruption.

Lost luggage makes up around 7% of all travel claims and the levels of cover can vary significantly.

Some bank accounts offer free annual travel insurance to customers, but it is vital that you check level of cover, as some will only offer a basic policy.

The valuables limit on a policy is generally quite low – usually just £250 – although some stratch up to £1,000.

It is worth remembering that the personal possessions section under a home insurance policy may cover your possessions wherever they the are, so ensure you don’t double up on premiums.

Removing the personal luggage element from a travel insurance policy could save you up to 15%.

Always consider the excess that you would have to pay when making a claim, as these can differ dramatically and apply to each insurance section.

For example, a stolen handbag could result in the policyholder paying a £60 excess for a new bag, £60 for the passport that was in the bag, and £60 for the cash that was stolen, resulting in a £180 bill before they get any compensation from the insurer..

What about natural disasters, such as a volcanic eruption?

This event is a very unusual and each insurer will have their own interpretation of this peril.

Some have responded by putting it under the travel delay section of the policy due to adverse weather conditions.

But as the volcanic ash cloud is no longer an unexpected event, many will find it difficult to buy cover.