The RAC will be apologising to more than one million customers for falling short on rules on insurance renewals.
The motoring organisation has become the latest – and one of the largest – businesses to be rapped by the Financial Conduct Authority watchdog.
Rules introduced by the FCA a year ago require firms to clearly show the insurance premium a customer paid last year alongside their proposed renewal premium.
They also require firms to show a "prominent, clear and straightforward message" to encourage customers to shop around.
However, when the RAC sent out breakdown policy renewal letters, they failed to do either.
Jonathan Davidson, executive director of supervision at the FCA, said: "It is simply unacceptable to see that some firms are still not being properly transparent with their customers a year on from the introduction of the rules.
"Firms failing to get this right may have led to consumers losing out as they do not have the right information to decide whether or not to shop around."
He vowed to continue to monitor firms to ensure they were being transparent.
"As we said in October, we expect other firms to take notice of these issues, to look at what they are doing and to make sure they are getting it right," he said.
'Committed to giving members fair information'
Other firms, including Admiral and M&S Insurance, have previously been criticised for failing to comply with the rules.
An RAC spokesperson said that the firm was committed to giving members fair information to make fully informed decisions.
The RAC said: "While our breakdown policy renewal documentation did accurately contain all the necessary information, we recognise that some of the key information in our letters was not as prominently displayed as it should have been."
It is not clear if any RAC members will be eligible for compensation and/or how much.