£55,000 for death of my husband? But he's at work...

The letter said that following the death of her husband Harry, the rest of their mortgage was being paid off and she would receive a £25,000 lump sum.

He had only left for work a few hours earlier, but Mrs Wood was still alarmed so rang him to confirm that he was alive and well.

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Given the opportunity to live mortgage-free, some hard-pressed homeowners would have been unable to resist playing along.

But the Woods are law-abiding, so Mr Wood, 52, contacted their insurers and building society to convince them that, in Mark Twain's famous phrase, reports of his death had been greatly exaggerated.

"If I'd been that sort of person, I'd probably have got away with it, but it never crossed my mind," he said yesterday.

"I knew it would cause problems sooner or later so I wanted to nip it in the bud, but it

was a real nightmare."

The letter from Norwich Union, with whom the Woods have life insurance, arrived on May 23. It began: "I am sorry to learn of the death of your husband on 17 April 2007 and offer my severe condolences."

The letter told 46-year-old Mrs Wood that in line with the policy, the remaining £30,000 or so of their mortgage was being paid off and she would receive a cheque for £25,000.

"My stomach turned over," she said. "Of course I knew he'd left for work that morning, but it's a terrible thing to read. I rang him straightaway to check he was okay."

The next day a letter for Mrs Wood arrived from the Skipton Building Society suspending the couple's mortgage.

The society had been wrongly informed by Norwich Union that Mr Wood was dead.

Mr Wood had been at his job at a paper mill on April 17 and had not suffered a scratch.

However he had risked his life a few weeks earlier when he went into a burning flat opposite their home in Heysham, Lancashire, and rescued a four-year-old boy.

Mr Wood said: "I rang Norwich Union and the adviser said, 'I've got your death certificate in front of me'.

"It had my full name and my date of birth. I told him I was definitely alive and eventually he said, 'I think there's been a bit of a mistake'."

Yesterday the Woods received a bunch of flowers and a case of wine from Norwich Union by way of apology.

They are also being given £250 compensation.

The couple, who have two grown-up sons, bought their semi-detached ex-council house for £50,000 in 1999.

A spokesman for the firm said: "A mistake was made when we received a death certificate for a person with the same name and the same date of birth as Mr Wood.

"Unfortunately, the two policies were confused and a letter was sent to the wife of the wrong Mr Wood. Mr Wood's policy will be reinstated."