Autonet insurance!!! is this legal/ilegal?

hi my husband recently cancelled his car insurance policy with www.autonetinsurance.co.uk, when he cancelled it he was told that there was an balance outstanding of £77, as we r currently out of work, they set up a payment play, which he has paid on time ever time a payment was due, since then we have had letters... show more hi
my husband recently cancelled his car insurance policy with www.autonetinsurance.co.uk, when he cancelled it he was told that there was an balance outstanding of £77, as we r currently out of work, they set up a payment play, which he has paid on time ever time a payment was due, since then we have had letters from autonet stating that we have made no contact and continue to not pay the balance, i have rung them loads of time, and they just keep saying it what they have to do, the last letter we recieved, said that if we didnt pay the balance in full within 7 days it would go to a debt company.
i called autonet and they said it is standard procedure and it wont come to that so i left it at that.
BUT today we have recieved a letter from a debt company sayin that we havnt made any payments so they have added a £25 admin charge and if we dont pay in full within 7 days they will issue court proceedings and a CCJ will be issued against my husband (dont want this as he has no debt and no bad credit so this will ruin his credit file)
i called autonet again and (no suprise here) they said its there procedure!!!

so my question is what can i do about this???

so sorry for the long post but just wanted to get everything in.

thanks in advance for your replies.
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