Travel insurance is one of those things you hope never to use, but will be deeply grateful for when you do. At its core, good travel insurance covers three things: medical emergencies, trip cancellation/interruption, and lost or delayed baggage.
Medical cover is the most important. The NHS doesn't cover you abroad, and emergency medical evacuation can cost tens of thousands of pounds. Look for at least £5 million in medical cover when travelling to the USA or Canada.
Many credit cards include some travel insurance — check your policy before purchasing separately. Annual multi-trip policies are almost always better value than single-trip if you travel more than twice a year.
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