Before sailing off on a cruise or testing your mettle on a hiking tour of the Himalayan mountains, make sure you have adequate insurance. Vacations can sometimes cost thousands of dollars so it is important to have the proper insurance protection in case the cruise or tour operator goes bankrupt or you need to cancel the trip due to sickness or other disaster.

four major types of travel insurance--

1 -- Trip Cancellation Insurance

This would reimburse you if the cruise line or tour operator goes out of business. It would also provide coverage if you have to cancel the trip due to sickness, a death in the family or other calamity listed in the policy.

In addition, if you or an immediate family member becomes seriously ill or injured during the trip most policies would reimburse you for the unused portion of the vacation.

The cost is generally 5% to 7% of the price of the vacation, so a $5,000 trip would cost roughly $250 to $350 to insure.

Trip cancellation is very different from a cancellation waiver that many cruise and tour operators offer. Waivers are relatively inexpensive, costing approximately $40 to $60. They provide coverage if you have to cancel the trip, but they have many restrictions. They must be purchased when you book the trip and they will usually not cover you immediately before departure (the time period most people cancel) or after the trip has begun. Most importantly, waivers are not insurance. Cancellation waivers are not regulated by the state department of insurance, so if your tour or cruise operator gets into financial difficulty you may not be able to collect.

2  -- Baggage Insurance or Personal Effects Coverage

This would provide coverage if your personal belongings are lost, stolen or damaged during the trip.

To insure $1,000 worth of personal belongings for a week, it would cost roughly $50.

Before purchasing this type of coverage, find out how much insurance the airline or trip operator provides for your belongings.

Also, check your homeowners or renters policy. It will usually provide coverage for off-premises theft. Therefore, if your luggage is stolen, your insurer will pay to replace it less the deductible.

If you are traveling with expensive electronic equipment, jewelry or sporting gear, it might be more cost-effective to purchase a floater or endorsement to your homeowners or renters policy. The cost to insure a $1,000 ring would be between $10 to $40. This would provide full coverage for the item, anywhere in the world, usually for one year.

3 -- Emergency Medical Assistance

This provides insurance and medical assistance for travelers. It would cover you if you had to be airlifted off a mountain due to a skiing or hiking accident or had to stay for a prolonged period of time in a foreign hospital. It would also provide coverage if you got seriously sick or injured and needed to be flown home. Some commercial airlines require very sick passengers to travel on a stretcher with a doctor. This means that you might have to purchase 10 or more seats on a plane at a possible cost of over $10,000.

Before purchasing this type of coverage, check with your own health insurance carrier. Find out what type of coverage you have when traveling abroad and if there are any limits. Also, ask if they will pay to fly you home or to a country with first-rate medical care.

4 -- Accidental Death

This would provide a variety of coverages if you or a family member dies on the trip.

Generally, if you have a good life insurance plan or made other financial provisions for your loved ones, this may be duplicate insurance.

TO GET COVERAGE call your credit card company, they sometimes provide travel-related services and coverage. You can also purchase travel insurance from either a travel agent or you can buy it directly from an insurer that specializes in this type of coverage.