Water plays an active role in many fundamental phenomena in cellular systems such as molecular recognition, folding and conformational equilibria, reaction kinetics and phase partitioning. Hence, our ability to account for the energetics of these processes is highly dependent on the models we use for calculating solvation effects. For example, theoretical prediction of protein-ligand binding modes (i.e., docking) and binding affinities (i.e., scoring) requires an accurate description of the change in hydration that accompanies solute binding. In this review, we discuss the challenges of constructing solvation models that capture these effects, with an emphasis on continuum models and on more recent developments in the field. In our discussion of methods, relatively greater attention will be given to boundary element solutions to the Poisson equation and to nonpolar solvation models, two areas that have become increasingly important but are likely to be less familiar to many readers. The other focus will be upon the trending efforts for evaluating solvation models in order to uncover limitations, biases, and potentially attractive directions for their improvement and applicability. The prospective and retrospective performance of a variety of solvation models in the SAMPL blind challenges will be discussed in detail. After just a few years, these benchmarking exercises have already had a tangible effect in guiding the improvement of solvation models.