Losing your phone or your sim card, especially abroad, can trigger a nightmare of unknown and unpayable bills.

Elizabeth Lawson (above), the account holder for her student daughter Melissa's O2 mobile, reported the loss of the phone's sim card in Peru - but only when Melissa got back from her trip.

She said: "Shortly after this I received a bill for £500 [her contract is £20 a month], which I paid. A few weeks later we received another bill for £3500. This bill was run up after my daughter lost her sim, so was obviously as a result of misuse."

She subsequently raised a complaint with O2, claiming that she should have been alerted to the suspicious running of the account long before it reached such a huge amount. But the senior complaints team at O2 ruled that the bill was completely Lawson's responsibility, despite the evidence of misuse.

She says: "My daughter is now at university but instead of enjoying the experience she is worrying about the bill with O2. I have contacted the ombudsman and am waiting for a reply from them."

Lawson then appealed directly to O2's chief executive Ronan Dunne, prompting an offer from the telecoms giant of a 50% refund, or £1750, as a "gesture of goodwill". She says: "Although we are, of course, grateful for this gesture I have still had to pay £2200 for the misuse of Melissa's sim. I feel that people should be warned about the dangers and that if things go wrong mobile companies and insurance companies look the other way."

The phone networks say the customer is "responsible for all charges on a lost or stolen phone up to the point that he or she reports it as stolen".

In one case, a honeymoon couple were presented with a bill for £8200 by Vodafone on their return after swapping their own sim card for a local network card to save money, and not realising the original sim was being re-used.

Another Vodafone customer was asked to pay a £1065 bill despite reporting a lost phone within 24 hours. In both cases, Vodafone waived the charges after concluding the thefts were part of an "organised scam" involving a phoney premium-rate call line.

But most refunds will only be on a goodwill basis. Regulator Ofcom said: "Treat your phone as carefully as you would your bank cards. Take care when using your phone in public, and don't let it out of your possession. Thieves can quickly rack up huge bills on stolen phones, and you may be liable for all charges run up on your phone before you have reported it lost or stolen to your provider.

"Protect your phone against unauthorised use by setting up a PIN, swipe pattern or password for your home screen. You can usually do this through the settings feature.

"You should also make a record of your phone's IMEI number, as well as the make and model number. The IMEI is a unique 15-digit serial number, which you will need to give to your mobile operator to have your phone blocked if it goes missing. It is behind your phone battery."

Ofcom added: "Consider making your phone less useful to potential thieves by barring calls to international numbers and premium rate lines, if you never use them."

Some mobile insurance policies, or any other policies that may cover your mobile phone, could provide limited cover for unauthorised use. So it is worth checking the terms and conditions of your existing policy, and when considering a new policy.

Elsewhere, the national Mobile Phone Crime Unit's "Immobilise" database is a free registration service used by the police in reuniting owners with their stolen smartphones.