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SINCE MANY PEOPLE SHELL out thousands of dollars for major trips, it's no surprise thepercentage buying travel insurance has increased substantially since theSeptember 2001 terrorist attacks.

The demand forinsurance goes beyond fear that terrorist activities could cancel or interrupt trips. The downturn in tourism contributed tothe instability of some tour and cruise operators. Seniors and thosewith pre-existing medical problems mayhave health concerns. Parents worry that a child's illness will cancel theirdream vacation or cut it short.

Although travel insurance can cost as much as sixpercent of your trip, it can be a wise investmentfor big-ticket cruises or multi-leg tours that demand totalpayment months in advance and impose hefty cancellation penalties.

Frequent cruise andtour travelers Dianne and Edgar Gutweniger of Sun City West, Arizona, considerit a necessity whether their destination is Alaska, Hawaii,or Russia. "We take our chances on two-night tripsthat cost around , but on the longer trips thatrun ,000 to ,000 each, we always purchase insurance," Dianne said.

Benefits Galore

Aswith other types of insurance, travel insurance benefits varywidely. Dan Bachmann, president of Ford's World Travel (with three Arizona locations), said 80 percent of his clients take some form of insurance,depending on circumstances.

Benefits caninclude trip cancellation insurance (TCI), travel delays beyond a certain number of hours, supplierdefault, terrorism, lost baggage, emergency medical care, and medical evacuation.

Bachmann said some policies will pay for trip cancellation ifyou lose your job or your child becomes seriously ill. Others provide benefits ifyou're called to militaryor jury duty, or if the company you work for is involved ina merger or acquisition and your presence is required.

Read the FinePrint

As with other contracts, take time to read the small print. Terrorism coverage, for example, may haveunique exclusions that make it difficult to collect.

Travel delay coverage differs widely from policy to policy."It could be six to 12 hours beforepayment kicks in," Bachmann advised. "Watch out for exclusions--sometravel insurance policies provide only secondary coverage." Thus,if your lost or stolen jewelry or camcorder is covered by your homeowner'spolicy, you'll collect on that first. Likewise, you would collect first from your primary medicalinsurance plan if you are injured or become ill andneed medical evacuation.

Trip cancellation coverage alsomay have some exclusions. The insurance may or may not ante upif you cancel because your traveling companion who is not a family memberbecomes ill at the last minute.

Becausenot all tour operators are financially stable, financial default protection is important.Some insurance companies exclude certain unreliable tour operators.

Medical Coverage Tricky

Finding emergency medical care when traveling can be stressful enoughwithout worrying about paying the bills. Check to ensure your medical insurance is valid atyour destination and enroute, especially if your plan istied to a local medical group.

Since some premiums areage-based, a 65-year-old likely will pay morethan someone 55. Many policies will not cover pre-existing medical conditions. However, Bachmann saidif travelers buy insurance withina week after booking their trip, pre-existing conditions can be waived.

Medical evacuation insuranceis critical if you travel to a remote location and needair evacuation to a distant hospital.

Shop Around

You can purchase travel insurance fromtravel agents, cruise and tour operations, or via theInternet. The Gutwenigers purchase insurance throughtheir travel agent, who helps them find the right coverage for their situation.Some agents provide a sample policy to review, whereas the Internet does not alwaysanswer all questions.

Compare and contrast policies. For fast costcomparisons from a number of insurers based on informationyou plug in, visit www.InsureMyTrip.com.