Don't redirect an important letter - it won't go post-haste

READERS' LIVES

My daughter's former flatmates forwarded a letter with a cheque enclosed to her new address. When the letter had failed to arrived after a week, I contacted my local post office. They said that forwarded mail had no priority and could take around 10 days. Eventually I put a stop on the cheque (for a fee) and wrote out a replacement. Coincidentally, the second cheque arrived at the new address on the same day as the first cheque, two weeks after the latter had been forwarded. Why so long? Could I claim for my extra costs against the Post Office?

DS. Norfolk

A claim would almost certainly not succeed. More to the point, the Post Office confirms that your experience is likely to be fairly typical. Under something called the inland letter post scheme, you are allowed to forward a letter free of charge within 24 hours of receiving it. In practice, the 24-hour rule is not enforced. But whenever you forward a letter (and even if you do it within 24 hours) it won't get priority. It is quite likely to take 10 days or so to reach its new destination.

This is probably news to most people; the Post Office doesn't really publicise this fact. If it did call attention to the expected time taken, more people would be willing to pay them for speedier forwarding.

There are two possible solutions for individuals. First, for the odd letter that needs to reach the recipient quickly, you should simply put a fresh stamp on the envelope (or even put the letter in a new envelope). Or, for regular forwarding, consider using the official redirection service. Post officially redirected should not be delayed by the Post Office. The service costs pounds 6 for one month, pounds 13 for three months, pounds 30 for a year or double these rates for post redirected to an address abroad using international air mail. You can pick up forms for the service from post offices, or you can telephone 0345 777888 and pay by credit card.

The Post Office says its legal obligation is limited to delivering post to the address given rather than to the named recipient. Note, too, that it is an offence wilfully or maliciously to fail to return post that does not belong to you (with suitable words written on such as "gone away" or "not known at this address").

I have a unit-linked endowment policy as part of my mortgage. The policy has been running for eight years and has another 17 years to run. I can now pay off the mortgage and want to cancel the policy. Instead of cashing in the policy I would like to sell it in the second-hand endowment market, as I understand this should give me more money. However, I've been told I am unlikely to find a buyer. Can you offer any advice?

RL, Somerset

As you rightly say, selling an unwanted endowment policy will often produce more money than cashing it in ("surrendering" it) with the insurance company. Unfortunately, not all policies have a resale value. For a start, this market is comprised of "with-profits"-type policies. "Unit-linked" policies (where the value directly follows the performance of the underlying investments), which yours is, don't have a resale value.

Moreover, only some with-profits policies are worth selling on. The surrender value of a policy - ie. what the insurance company will pay you for it - has to be sufficiently low for any offered second-hand value to benefit you, to give the ultimate buyer a decent return and to give a living to the go-between firm handling the sale. The fact that the second-hand market in with-profits policies can be profitable to all three parties is testimony to just how poor early surrender values can be.

But some policies may have a surrender value that is sufficiently high to rule out a second-hand value. Even then, however, the surrender value may not reflect the real worth of the policy. In this case, the only way to get better value is to carry on paying the premiums for the full term of the policy.

There are other factors affecting the marketability of a with-profits policy. For example, a policy normally has to have been going for at least five years and usually will have no more than five or 10 years before its maturity date. Anyone wanting to sell an endowment policy could contact the Association of Policy Market Makers for a list of members. Write to APMM, The Holywell Centre, 1 Phipp Street, London EC2A 4PS (tel: 0171- 739 3949).

The best way to avoid the possibility of losing out on an endowment policy is not to start a policy in the first place. Long-term endowment policies continue to be sold as investments to pay off a mortgage. The with-profits variety in particular is sold as a "low-risk" investment. But many people would be better off with a different repayment vehicle.

q Write to Steve Lodge, Personal Finance Editor, Independent on Sunday, 1 Canada Square, Canary Wharf, London E14 5DL, and include a phone number, or fax 0171-293 2096 or e-mail s.lodge@ independent.co.uk. Do not enclose SAEs or any documents you wish returned. We cannot give personal replies or guarantee to answer every letter. We accept no legal responsibility for advice given.