The regulator found that in both the home insurance and car insurance industries were not always providing customers with clear information about the different payment options available

The review looked at 13 insurance firms and 30 intermediaries, including four price comparison websites.

Failings meant customers could have been left unable to compare the overall cost of a product against others in the market. The difference in price between paying up front and paying in installments was also not made clear.

Intermediary firms often did not properly explain their relationships with insurance firms and in some cases it was not clear that consumers would be charged a fee for the services.

Linda Woodall, acting director of supervision at the FCA, said customers needed to know whether a deal was right for them.

“Consumers should expect clear information about the payment options available to them,” she said.

“Regardless of whether people choose to pay upfront or in instalments, it’s important that they can see exactly what they are signing up for and how much it costs so they can decide whether they are getting a fair deal.”

The regulator said all firms must consider the findings of the report and take immediate action if they do not meet best practice.