Taking back presents ... travel cover ... endowment policies. Your everyday financial queries answered
Sunday 29 December 1996
The first thing to say is that there is usually a difference between something being unsuitable and something being faulty. If something you buy at any time of the year is unsuitable you can't normally demand a refund if it is basically fit for the purpose for which it was sold. That said, many shops will give a refund, or at least give a swap or credit note, as a matter of goodwill.
The issue of faulty goods is somewhat different. The general rule is that if something does not fit its description, or is not of satisfactory quality, you have a right against the shop (and not against the manufacturer) for a full refund - not a swap, credit note or a repair. You must bring the goods back very quickly. The same rights, of course, apply to anything you buy in the January sales, except where something which is marked down in price is sold on the basis that it has a specific fault which has been pointed out.
Curiously, sale of goods rights are, technically, lost with presents. In other words, the recipient of the present cannot demand a refund. If you are dealing with a retailer of whose reputation you are unsure, it may be best for the original buyer to sort out the problem. They should not mention that the item had been bought as a present.
Don't forget the valuable legal protection for goods bought with a credit card (though it does not come with debit cards or charge cards). Provided the goods cost at least pounds 100 (even if you made only a part-payment of less than pounds 100 with your credit card) your legal rights can be enforced against the retailer or the credit card company. In other words, you can ask the credit card company for a refund.
I've read that instead of buying travel insurance for each holiday, a policy lasting a full year gives better value. I've also been told that some policies give inadequate cover for skiing trips. What sort of policy is best?
It is true that an annual travel insurance policy can work out much better value for people who take two or more holidays a year. This also gives the added advantage of covering the odd weekend away in Amsterdam, or a day trip to Calais.
Holiday insurance is essential for all foreign trips - even for a short hop across the Channel. Otherwise, you may face big bills if you are unexpectedly taken into hospital.
It is true that some policies may give inadequate cover for skiing holidays (and, indeed, other holidays which involve certain sports and hazardous activities). There are, however, suitable polices on the market and many annual policies include cover for winter sports or will offer it as an add-on. You should check how much skiing cover is given and read the small print. There may be a time-limit of 17 days a year on annual policies, and this could prove inadequate for someone who takes two skiing holidays. You should also get a policy which covers all the areas of the world you are likely to visit. And if you are an experienced or simply adventurous skier, make sure you get a policy which covers off-piste skiing. Companies which may be worth getting details from include Club Direct (01243 787838), Columbus (0171 375 0011), Inter Assurance (01252 717766) and WorldCover Direct (0800 365121).
How can I find out which endowment policy is likely to turn in the best investment performance and produce the biggest lump sum when it matures?
Are you really sure you want to take out an endowment policy? A personal equity plan will offer more tax breaks and should prove to be more flexible. An endowment also includes life insurance which will hold back your investment returns.
However, if you are sure that you want an endowment policy and will keep it going for its full term (which is the way to get best value from such policies), the starting point is the projected return which a company is obliged to give. In fact, all life companies have to use the same rates of return to show what a policy might finally be worth. So to that extent, projections have to be taken with a pinch of salt.
But these projections do take account of a company's charging structure. So you can see which companies will charge the most given a set rate of return. The apparently higher charging companies may justify their charges by superior investment performance - but the higher the charges, the harder it becomes to outperform the competition.
Then you should look at past performance. Bear in mind that past performance is no guarantee of future performance. Be wary of past performance figures and league tables given by the companies. They may choose the most appropriate dates to show them in the best light.
An objective analysis of past performance is contained in a new monthly publication, Life & Pensions & Unit Trusts Moneyfacts. It's aimed primarily at financial advisers. You would have to subscribe for a whole year at a cost of pounds 38.50. But since the difference in endowment policy maturity values can be thousands of pounds on the same monthly premium, spending some money to get the right policy should be worthwhile. For details, write to Moneyfacts, North Walsham, Norfolk, NR28 OBD or call 01692 500677.
q Write to Steve Lodge, personal finance editor, Independent on Sunday, 1 Canada Square, Canary Wharf, London E14 5DL, and include a telephone number.
Do not enclose SAEs or any documents that you wish to be returned. We cannot give personal replies and cannot guarantee to answer every letter we receive. We accept no legal responsibility for advice.
- 1 Morgan Freeman on the riot-focused coverage of the Baltimore protests: 'F**k the media'
- 2 The man who filmed the Freddie Gray video has been arrested at gunpoint
- 3 Top Gear: Jodie Kidd, Philip Glenister and Guy Martin 'in advanced talks' to replace Jeremy Clarkson and co
- 4 Frankie Boyle on Scottish independence: 'In the Interests of Unity, F**k Off'
- 5 Length of pregnancy can vary by up to five weeks, scientists discover
Boston Marathon runner's search for mystery man she kissed ends with letter from his wife
Saudi Arabia's King Salman sacks senior aide for 'slapping' a journalist behind him live on TV
Frankie Boyle on Scottish independence: 'In the Interests of Unity, F**k Off'
Italian police 'reveal' what Jesus looked like as a young boy
Florida couple forced to register as sex offenders for having sex on public beach
In defence of liberal democracy
The Rothschild Libel: Why has it taken 200 years for an anti-Semitic slur that emerged from the Battle of Waterloo to be dismissed?
General Election 2015: UK will be 'run for the wealthy and powerful' if Tories retain power, Labour warns
General election live: SNP suspends two members for disrupting Labour rally
Schools forced to act as 'miniature welfare states' with teachers buying underwear and even haircuts for poor pupils
Andy McSmith's Sketch: Feisty audience is the real star of an enlightening show
iJobs Money & Business
£40-50k + Benefits.: Guru Careers: A Project Manager / Business Analyst is nee...
£20000 - £25000 per annum + Uncapped commission: SThree: Can you speak German,...
£25000 - £30000 per annum + benefits: Ashdown Group: An exciting opportunity f...
£215 per day: Ashdown Group: Junior Project Manager (website, web application ...