Lost or stolen baggage has been named as the second most common reason for holidaymakers to make a claim on their travel insurance, with more than 1000 Brits a day losing bags at airports.

According to the figures, 396,000 British travellers contacted their travel insurer last year to make a claim concerning lost or stolen baggage.

The total value of the settlement paid out to policyholders for these lost and stolen baggage claims reached a total of £37.9 million.

The figure signalled an 8 per cent rise in the cost of payouts since the previous year when payouts totalled around £34.8 million.

Travel insurer Insure and Go, has found that 1,086 passengers lost luggage every day at airports last year, while 44,000 believed that their luggage was actually stolen.

As a consequence, passengers have become distrustful of the airlines and their employees, with one in eight, or twelve per cent of adults questioned saying that they do not trust baggage handlers at airports.

Meanwhile, twenty per cent of adults questioned said that they were so concerned that their bag could be misplaced that they actually packed less in order to only take hand luggage and avoid baggage handlers.

Despite the fact that so many are worried about lost or stolen baggage, it is not actually the most common claim to be made on travel insurance.

The most common, and most expensive, type of claims were for medical claims, with 565,500 claims for medical cover made last year.

The total cost of those claims totalled a massive £383 million, a dramatic 58 per cent rise since 2007.

Flight cancellations came in as the third most common reason to claim, with over 240,000 claims made for cancelled flights in 2008, the year of the Heathrow Terminal 5 fiasco.

The value of the claims for cancelled flights also rose, in this case by 22 per cent, creating an overall increase of 51 per cent in the value of claims made in 2008.

In 2007, the UK travel insurance industry paid out £77 million in claims, for 2008, the figure had risen dramatically to £116 million.

The top five travel insurance claims for 2008 were: medical problems; lost or stolen baggage; cancellation of flights; lost or stolen money and travel delay.

Perry Wilson, founder of InsureandGo, said: “Lost baggage remains one of the most common problems for holidaymakers. 

“The average lost luggage claim cost has risen quite substantially, which suggests that either people are packing more expensive luggage, or they have started exaggerating the value of it.”

He added: “Medical claims are still the most costly for the travel insurance industry. 

“Unfortunately the average claim value seems to be rocketing, which highlights just how important it is for people to have adequate travel insurance, particularly when times are tough.”