Master mariner's life insurance payout all at sea

In June 1999, an offshore policy with Old Mutual matured, although I had forgotten it was due. I am a foreign-going master mariner and was at sea from 25 February until 29 September last year. I am single, and my mail is not opened until I return to the UK. I contacted Old Mutual on my return and it paid me £168,271 on 20 October - four months late, but with no interest.

When I questioned this, Old Mutual said its licence to operate as a life insurer does not allow it to hold clients' money in interest-bearing accounts. Old Mutual would make an ex gratia payment only if it had been at fault, but it had written to me and my broker, Clydesdale Bank Insurance Brokers, several times.
IC, Greenock

Old Mutual admits it can hold money in interest-bearing accounts but not in 'client' accounts: your money earns interest but Old Mutual keeps it.

As this was an offshore account, it was not covered by an Association of British Insurers' guideline saying companies must add interest to policy payouts if there is more than two months' delay sending the cheque. The fund involved is based in the Isle of Man, and the Manx Insurance Association has no such rule.

But while investigating, Old Mutual uncovered an error when calculating the proceeds. Most policies earn no investment growth after the maturity date, hence the case for adding interest. But your policy is different and should have stayed invested until the payout date. In those four months, the guaranteed element grew by £2,208. But, because sterling corporate bond prices fell, the final bonus dropped by 26 per cent, cutting your payout by £5,597.

The firm says it would have paid up if you would have been better off with the later calculation. It will not consider compensation as it did all it could to contact you. Clydesdale says it too made every effort to find you. It believes you should have left a contact address.

Computer glitch: Double Time

I bought a computer from Time in August 1999 and paid£1,512 in full. My bank confirmed the cheque was cashed. A year later, First National Tricity, a finance company, is demanding£73.73 a month for 36 months, a total of£2,654. First National is ignoring the£1,512 I paid to Time Computers and phones me at all times, as late as 9 o'clock at night. I am 85 and cannot cope with harassment.
NN, Dursley

First National Tricity says the problem arose because you sent your cheque to Time Computers. As First National had not received your money, the system automatically treated you as a non-payer. But the lender agrees that you did settle your account punctually and should not be penalised.

It contacted Time and Time has now forwarded the cheque. But First National could not process this for three weeks because its computer was down for an August overhaul. Your account, however, is regarded as closed.

The bank that said no: Printing is the form

I have power of attorney over my 84-year-old mother's affairs. I wrote to Lloyds TSB, where she has her current account, asking it to transfer £52,000 (the proceeds of selling her flat) to her Egg account. But Lloyds flatly refused, despite having done something similar for a smaller sum a month earlier.

Egg agreed to accept a cheque instead of electronic transfer, but Lloyds sat on the money for three weeks. It irks me to think of the interest Lloyds gained.
LA, Stockport

These days you have to pay money into banks on forms pre-printed with the customer's account number and the receiving bank's sort code.

Lloyds allowed your handwritten instructions through the first time, but should then have told you to use the forms in future rather than write letters. Lloyds admits to poor communications, and has agreed to refund the interest your mother would have earned in the Egg account if the transfer had gone through swiftly. It is sending a cheque for £179 and, because you felt compensation was due, has added £50.

Riddle of shut tax file: Point of no return

My wife is over 60 and still working for a local care agency. She is taxed under PAYE but has always received a tax return as well for our modest joint extra income. By June this year, her tax return had not arrived and, when I inquired, was told, 'Your wife's file has been closed.'

The tax office obviously knows she is still working, so I am at a loss to know why this was done.
SC, South Molton

The Revenue admits that saying the file was closed was a bad choice of words. It really meant that she does not have to complete a tax return this year.

At retirement age, finances usually change so the taxman might send out returns for about three years to monitor the new pattern. The Revenue has presumably decided that your wife's tax position is stable. When she eventually retires, the tax returns will probably start arriving again.

Action on complaints: Protests do pay off

Lots of people won't think of enlisting your help when they have a problem with a large institution, and have to lump it. I envisage institutions having one in-tray for 'suckers' and another for 'disputers'.

How many special cases that you bring to a company's attention does it take before they become more reasonable?
FU, Ledbury

Often institutions say they will correct mistakes immediately when these are procedural errors, such as computer blips that fail to send reminder letters. Occasionally they admit to inadequate staff training if branches are caught giving out wrong information, and someone is 'spoken to'.

But mostly they maintain that complicated problems are caused by unusual circumstances, and admit only that their service has 'on this rare occasion' fallen below the 'usual high standard'.

Letters of apology and complaint-handling have improved vastly in the past few years. But saying that service will be better is not the same as actually treating customers more thoughtfully. Companies need constant reminders that their customers are prepared to complain, through the newspaper if necessary.

• Write to Margaret Dibben, Money Writes, The Observer, 119 Farringdon Road, London EC1R 3ER, and include a telephone number. Do not enclose SAEs or original documents. Letters are selected for publication and we cannot give personal replies. The newspaper accepts no legal responsibility for advice.