What with last year’s increase in Airport Departure Tax and this month’s rise in VAT, British tourists are likely to see the cost of holidays rise in 2011.

A report published by the Association of British Travel Agents (ABTA), suggests that three quarters of travellers believe that getting the greatest value for money is either essential or important.

But, as the Foreign and Commonwealth office has warned, travel insurance is not the place to cut costs. Obviously it is always wise to shop around and get best price you can, but don’t compromise on cover, particularly if you have pre-existing medical conditions that you need to cover.

Remember, if you are looking for travel insurance for pre-existing medical conditions it is vital declare your condition when you buy, to ensure that you get the right cover for your needs.

Look for savings and be prepared.

One way of keeping costs down is to travel to destinations that are outside of the Eurozone where we can get more for our money. ABTA’s report predicts that Turkey and Egypt will continue to be popular destinations, and increasingly so will Tunisia, Syria and Abu Dhabi. In these types of mid-haul destinations, where cultures can be very different from our own, it is important to be prepared. A little knowledge about the local laws or customs can go a long way if things don’t go exactly to plan when you’re away.

For up to date travel advice on your holiday destination visit the FCO website.

Another way to keep costs down is to stay with friends or relatives abroad, rather than in a hotel. If you do intend to stay with friends or family, in a country that you visit regularly, it’s easy to overlook the importance of travel insurance. But, as the FCO warns, travel insurance is important to avoid the risk of you or your family being billed thousands of pounds for medical treatment abroad if you fall ill or have an accident.

It is possible to save money by avoiding destinations where the cost of living is expensive, but where ever you choose to go it is important to be prepared, do your research before you travel and buy adequate travel insurance.