LONDON - Insurance giant Aegon owned Stonebridge International Insurance has been fined 8.3 million pounds by Britain's financial sector regulator for mis-selling accident insurance products.

Up to 486,444 customers across the UK and EU could be affected by the actions of the Financial Conduct Authority (FCA) on Thursday.

Stonebridge has already paid redress worth a total of 400,000 pounds to affected customers in the UK, the FCA said in a statement.

Giving details of the case, the FCA said that between April 2011 and December 2012, Stonebridge targeted low and middle income customers without college degrees or professional qualifications, with its personal accident, accidental death and accidental cash plan insurance products.

Outsourcing companies sold policies over the telephone, with those responsible for sales, encouraging people to buy more expensive products, whilst companies responsible for post-sale support actively discouraged customers from cancelling their policies.

"Customers are entitled to expect firms to provide them with fair and balanced information to enable them to make the right choices about the product that is right for them. Stonebridge failed to do this and, when customers tried to cancel, put up barriers to prevent them from doing so," said Tracey McDermott, FCA director of enforcement and financial crime.

"Firms must take responsibility for their outsourcing arrangements and ensure that they treat customers fairly."

The products were sold over the phone to retail customers in the UK, Germany, France, Italy and Spain, with lists of potential customers provided by Stonebridge's business partners, including catalogue sales firms, online retailers, banks and credit card companies, according to FCA.

In return for information about prospective customers, Stonebridge paid the firms a percentage of the premiums.

The FCA found that the telesales scripts that Stonebridge designed for its outsourcing companies did not provide clear, fair and balanced information.

The regulator found that in 80% of the 30 sales calls it reviewed, customers were not provided with appropriate information about the policies that would enable an informed decision. It also said that in a follow up review, in 37 of 45 calls made by the staff, the customers were not made aware of the different options and prices available.

It also found that Stonebridge's poor systems and controls, and inadequate oversight of its outsourcing companies breached the FCA's requirements that firms treat customers fairly and have appropriate systems and controls in place.

Stonebridge is carrying out an independent review of its past sales in the UK and EU and has started contacting affected customers to determine whether they should be compensated as a result of its poor sales practices.

In a statement, Stonebridge says: "Following the FCA Notice issued today Stonebridge acknowledge the findings of the FCA. The notice does not impact the day to day operations of Stonebridge and we remain a solvent trading company. We will continue to service our clients as usual. We will meet our obligations to our customers by providing claims and customer services to meet the expectations of our policyholders.

"All policies remain in force and Stonebridge will honour the terms and conditions of all existing policyholders."