Questions of Cash: Budget failed to repay my premium for off-the-road car

Q. I insured my son's car with Budget Insurance in April 2012. The policy was in his name, but I paid the premiums. On 25 April I received policy renewal documents from Budget. I rang Budget to inform them that I did not wish to renew the policy as the car was off the road and about to be sold. The call centre operative asked me when the car had been taken off the road and if there was a SORN [Statutory Off Road Notification]. I said there was.

The operative then suggested it may be possible to get a premium refund dating back to the commencement of the SORN. He checked and confirmed that premiums would be refunded if I supplied a copy of the SORN. Budget would also waive the policy cancellation fee and any premiums shown as due from the renewal date of 20 April. On 27 April I received a letter from Budget saying that it had attempted to collect a payment of £3146.34 for the renewal premium from my bank account, but my bank had declined the request. I wrote the same day to Budget, with a copy of the SORN and confirming my conversation over the phone. On 5 May I returned, as requested by Budget, the certificate of insurance.

As I didn't hear anything more from the company I phoned Budget's customer services on 26 May. The operative I spoke to this time said she could not help me and I needed to speak with a manager – but none was available. I was promised that someone would ring me on 28 May and, at my request, I was given the name of that person. No one phoned on 28 May, nor on 29, 30 or 31 May – but each day I phoned asking to speak to that manager. On every occasion I was told that he was not available, but would phone me the next day. I paid Budget £2,587.97 on 26 April 2011 and by my calculation, the insurance company now owes me a premium refund of £1,637.86. PY, Hertfordshire.

A. Budget apologises for the confusion and for the wrong information you were given. A spokeswoman said: "We have identified that our advisor incorrectly told [the reader] that we would be able to backdate the cancellation of his son's policy to the date of the SORN declaration. Whilst the vehicle was declared as 'off the road' the insurer would have still been liable for any claim for theft or fire damage to the vehicle. It was not possible to backdate the cancellation of the previous policy, as the full annual cover had been provided. We have been in contact with [the reader] and are pleased that this issue has now been resolved to his satisfaction. We accept that the standard of service given and the communication provided, on this occasion, fell below our expected levels of customer service. By way of apology, we have refunded [the reader's] premium from the time the vehicle was registered as SORN and, in addition, offered a further £100 compensation." Consequently you will receive a payment from Budget of £1,737.86.

Q. Early this year I booked Flybe flights from Exeter to Dublin for my wife and myself to fly on 30 August. After purchasing the flights I booked a 10-day walking holiday, including accommodation and transfers, starting from Dublin early on 31 August. Flybe has now sent me an email stating – without either reason or apology – that the flight has been cancelled. I have been offered a refund or alternative flights one day later or two days earlier. Our only realistic option is to fly earlier and book two extra days' accommodation in Dublin. Flybe has rejected my request for compensation towards my extra costs of around £200. This seems very hard. Is the airline allowed to do this? NB, Somerset.

A. Flybe directed us to its website, which specifies that where a flight is cancelled more than 14 days in advance, a passenger is entitled to a refund of the ticket price, or the use of an alternative flight to the destination as soon as possible afterwards. Alternatively they can choose an alternative flight to their final destination at a later date which suits them. The airline adds that it is not required to provide any financial compensation to passengers affected provided they have been given more than 14 days' notice. We have compared this to current European Union legislation and it seems to us that Flybe's rules are entirely compliant with its legal obligations.

Q. I have purchased a franchise. The franchisor promised to provide in-depth support for me in setting up my business. I haven't signed the franchise agreement yet, but I have paid out more than £10,000. After I paid the money over, all the promised support dried up. The training was completely disorganised and of absolutely no value. I was given a personal computer as part of the deal, but instead of being the promised new model it was old and had been used before. I understood from the prospectus that the franchisor was a member of the British Franchise Association – but it is not. Promised stationery has not arrived. The website is of very poor quality. I have spoken now to other franchisees, who are earning less than a third of the income they were told they could expect. The franchisor rejects my complaints. What can I do? It would cost me a fortune to go to a solicitor. AN, by email.

A. Upon discussing the problems with you, it emerged that you have signed an agreement not to talk to anyone regarding your franchise contract. We are not in a position to determine if this is legally enforceable. In these circumstances, we suggest that you pursue a legal route. At present, the threshold for legal action in the Small Claims Court is just £5,000, so that is not appropriate for you. You could seek free legal advice from Citizens' Advice. There is also a law centre – which specialises in providing legal support to people who cannot afford to use a solicitor – near to where you live.