The FSA has warned insurance firms to stop using savings claims in their advertising which could mislead consumers or they will face regulatory action.
This follows a review of promotions from 57 firms selling motor, home and travel insurance which found that 57 per cent of motor insurance adverts with savings claims were either unclear or misleading.
Of the home savings claim adverts, 25 per cent failed to provide any evidence as to how claimed savings would be achieved.
The FSA has contacted the firms where it had concerns and has asked them to improve their advertising. It will repeat this review in three months.
FSA retail themes director Vernon Everitt says: “Most people rely on some form of insurance to protect them and advertising is a major influence on what they choose to buy.
“So it must be clear, fair and not misleading, leaving people with a balanced picture of what is on offer. This work demonstrates that firms in the home, travel and car insurance markets must shape up and ensure that the claims they make do not mislead. We will be back in three months to assess progress and will then decide whether further regulatory action is needed.”