Holiday hitches with annual cover

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ANNUAL travel insurance policies are supposed to be the cheap and cheerful answer for the insurance needs of the frequent holidaymaker.

An annual policy with Leisurecare costs pounds 135 for a couple and pounds 165 for a family of two adults and two children. The cover is for an unlimited number of holidays worldwide, and for 17 days of winter sports.

These policies appear to offer excellent all-round value. But beware - like many, they do not cover UK holidays.

You can travel as often as you like to Bermuda, but if you cancel a holiday in Brighton you will have pay up unless you are insured.

Chris Whiteley, a spokesman for Whiteley, said: 'The UK is usually specifically excluded. How do we know if you make a claim that you had not lost the money going to Sainsbury's?'

Columbus Travel Insurance, another prominent player, covers the UK only if you have an overnight stay and travel by air.

The annual policies offered by Bradford & Bingley, National & Provincial, Frizzell and National Westminster Bank all do cover UK holidays.

Barclays Bank, however, is not waving the British flag. Even the Barclays press officer was 'surprised' that UK holidays are not covered in its annual policy.

Ben and Ann Marshall were equally surprised when they discovered that the foreign cover of the Barclays annual policy was not all it was cracked up to be either.

They live in North London and have a holiday home in Spain. 'We go abroad quite a lot, perhaps five times a year,' said Mr Marshall. 'Insurance can cost a fortune, so we looked into getting an annual insurance.

'But we do not always travel together; sometimes we go separately.'

The couple obtained a quote for an annual policy from Barclays. The premium was pounds 126 - pounds 97.50 for an individual and an extra pounds 28.50 to cover a spouse and two children.

Initially it looked a good bet. But then the couple discovered that Mrs Marshall was not covered to holiday on her own; the main-named insurer always has to travel at the same time.

Barclays came up with an alternative. Mrs Marshall could buy her own policy. The total cost of two individual policies would be pounds 195 - substantially more than the original cost.

There are only a handful of annual policies, including those from Leisurecare and Whiteley, which offer the flexibility of a spouse travelling independently for as many trips as they choose.

The alternative, as the Marshalls discovered, is for a couple to take out two individual annual policies.

And the cost of this can rocket if you have children travelling with separate spouses.

A family insurance bill with National Westminster Bank could be pounds 274. Columbus Travel Insurance charge pounds 67 per person for annual insurance. If you want to travel separately with children, the cost could increase to pounds 222. However, you can cut the cost of annual travel insurance. Check if your household insurance covers your personal possessions while on holiday. If so, you do not need to purchase this cover with your holiday insurance.

National & Provincial Building Society offers an annual holiday policy for pounds 75 per person. The premium is reduced to pounds 60 with a 20 per cent baggage cover discount. However, to insure the children is costly - pounds 50 per child (pounds 40 with the baggage discount).

Bradford & Bingley Building Society also offers a baggage discount. The standard annual individual premium is pounds 72.43 reduced to pounds 57.94. Each child is pounds 27.86 discounted to pounds 22.29.

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