What type of travel insurance do you need?

With the combination of political unrest, financial troubles of major tour operators and airlines, and the prevalence of nonrefundable airline tickets, more travelers have purchased travel insurance to protect themselves against unforeseen events that may impact their plans.

There are several different types of travel insurance policies available, ranging from trip cancellation insurance to emergency medical evacuation, all of which vary widely by company in what their coverage includes and how much it costs.

Make sure you know exactly what your policy will and will not cover before you purchase anything. See Traveler's Ed for help decoding your insurance policy in Travel Insurance: The Fine Print. Do You Need Insurance?

If you're asking yourself whether you need to buy travel insurance for an upcoming trip, first look at the insurance policies you already have to see what they will cover. Some medical insurance policies will cover medical emergencies overseas while others will not. Many homeowner's policies cover baggage loss. Also, many credit card companies (particularly gold cards) offer their members baggage loss, international medical assistance, and accidental death and dismemberment insurance if they simply charge their airline tickets on their credit card or for a small additional fee.

Since September 11, 2001, many are looking to travel insurance to safeguard their trip against any unforeseen terrorist attacks at their destination. Many policies now have an "Acts of Terrorism" clause that will reimburse you if you miss or are delayed in getting to your origination or ending destination because of acts of terrorism.

When considering trip cancellation insurance, take time to think about how much money you'll be putting down before your trip. Are you purchasing expensive airline tickets that can't be refunded? Are you putting down a large nonrefundable deposit on a cruise or tour? If the answer is yes, or if you might cancel for any reason, then buying trip cancellation insurance might be a prudent idea.

If you're an adventure traveler who has paid $3,000 up front for a white water rapids package deal in a remote area of South America and you won't receive any refund if you cancel, then you might want to consider both trip cancellation and emergency medical evacuation insurance.

Source: http://www.msnbc.msn.com