Will travel insurance cover you if you lose your job?

Dan McGinnity, vice president of Travel Guard, a major travel insurance company, and communications co-chair of the U.S. Travel Industry Association, says it depends on your policy.

Most travel insurance policy don't reimburse you if you cancel because you've lost your job. But several travel insurers offer policies that will reimburse travelers 80 percent of their costs if they cancel for any reason -- including job loss.

Of course, you'll pay extra for this coverage: Probably 8-10 percent of your trip cost, versus about 6 percent for the typical package policy covering cancellation, delay, default and medical.

Job insecurity isn't the only reason to consider travel insurance. Other factors:

• Financial default. No major travel companies have failed during the current economic downturn -- but these are tricky times. To protect yourself, purchase from a reputable third-party insurer -- not your travel supplier. To find a highly rated company, check one of these sites, which let you compare policies: www.insuremytrip.com, www.quotewright.com and www.squaremouth.com. Be sure to examine default policies; some insurers have a ''white list'' of companies they will cover, others have a ''black list'' of suppliers that are excluded.

• Illness. Package insurance policies, such as those on the sites above, allow you to cancel you if you or your traveling companion gets ill -- and they include close relatives. (Check policies carefully to be sure the family members you're most concerned about are covered.) To be sure existing conditions are included, buy your policy within seven days of your first trip payment.

A note: Yes, McGinnity's company is owned by the troubled insurance giant, AIG. McGinnity says Travel Guard's finances are separate and the company is well capitalized.

-- JANE WOOLDRIDGE

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