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How to ensure ideal travel insurance cover

Then last month she suffered an aneurism while working out at a gym. Karen's family made the heart-wrenching decision to turn off her life-support system.

The family believed all the costs of repatriating Karen's body back to Scotland had been covered by her travel insurance policy. They were shocked when they learned they had to pay $1760 towards the repatriation. As an act of kindness, the gym operators donated the equivalent of the shortfall.

Family friend Norma Taylor said she hoped Karen's tragedy would serve as a warning to parents that if their children go overseas on a big adventure they should make sure their insurance covered such an event.

Karen is not the first traveller to come to grief while on holiday overseas. Australians make about five million foreign trips each year. The majority of them have a happy experience.

Yet in 2007 the Federal Government's overseas consular offices helped in 25,000 cases of Aussies in difficulty in 152 countries, including 700 instances of hospitalisation, 600 deaths, 100 evacuations and many cases of robbery and assault.

While some travellers choose to leave Australia's shores without the protection of insurance, most make an attempt to cover themselves for unforeseen events such as Karen's sudden death.

But how do you know that you're covered for all eventualities? The difference between getting it right and getting it wrong can be prohibitive.

John was on a surfing holiday in the USA when a wave dumped him on to a reef. With serious head injuries, he was whisked to hospital and underwent a series of operations. The hospital bill was more than $100,000. Fortunately, John had done his homework and taken out comprehensive travel insurance; the insurance company readily agreed to pay up.

In fact, John had needed little convincing. Not long before, a friend of his had been hit by a car while crossing the road in Asia and had been evacuated back to Australia with a badly broken leg. The cost of the medical evacuation alone was $45,000. The friend did not have adequate travel insurance and had to take out a second mortgage to pay the bill.

So how do you know when you have the right amount of cover for your trip of a lifetime?

There are literally hundreds of travel insurance policies on offer. For most people it can be a daunting task finding the one that best works for them.

The proliferation of cheap policies on the internet has simply added to the confusion.

RACQ Travel Services provides travel insurance in alliance with Travellers Assistance. RACQ Travel Services manager Peter Darby says it's not about the cheapest policy, but one that is right for the traveller.

He says: "People spend hours, sometimes weeks, researching and choosing the right holiday experience. They need to attach as much importance to researching the right insurance cover. OK, so you might save a few dollars here and there, but what's the point if you've left some important aspect of travel uncovered and you end up financially ruined?"

Likewise, the Insurance Council of Australia receives many such requests. Unfortunately, neither Fellow Traveller nor the Insurance Council can recommend specific insurance providers...