The FSA has been taking a close interest in insurance sales methods
Insurance firms have been warned by the Financial Services Authority (FSA) to improve the way they "cold-call" potential customers.
After looking at the way 43 firms sold insurance policies over the phone, the FSA concluded that customers were in danger of being treated unfairly.
The FSA said the standard of sales involving cold calling was "poor".
However, the regulator said that the firms were now taking swift action to improve the way they sold insurance.
"The quality of cold calling in general insurance sales was disappointing," said Vernon Everitt of the FSA.
"Consumers were pressurised and the benefits of the product were sometimes exaggerated.
"The bottom line is that firms must never pressurise consumers into making a rushed decision, and must always clearly spell out the nature and limitations of the products."
Since last September, the FSA has been looking at the way insurance firms sell their policies over the phone.
It sent questionnaires to 43 firms, listened in to more than 260 calls made by salesmen at 19 of them and also visited 10 of the firms.
Where customers had called the company first, the FSA found that the salesmen's general approach was good, though the disclosure of any significant limitations and exclusions could have been better.
The main failings were detected when salesmen called potential customers out of the blue to sell policies such as personal accident, health, and sickness insurance.
Last month the FSA ordered the removal of unfair clauses in payment protection insurance policies (PPI).
And in January it warned the insurance industry to stop making false claims in adverts.