Approximately 100,000 customers could be compensated after Lloyds Banking Group was hit with a £28m ($45m) fine for pressuring its staff to sell products not required by customers.
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The Financial Conduct Authority said that incentive schemes created a failure in its sales process between 2010 and 2012, when staff at Lloyds TSB, Bank of Scotland and Halifax were put under pressure to hit targets, creating a "culture of miss-selling".
The regulator said the banks persuaded customers to take out more protection cover than they needed and that missold products included critical illness, income protection, life cover and "expenses on death".
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By GlobalDataThe products also included personal investment plans, Individual Savings Accounts (ISAs) and Open Ended Investment Companies (OEICs).
At this point, Lloyds will undertake an internal review to establish who exactly should be compensated, prioritising 11,000 cases.
Lloyds customers were sold £1.2bn worth of products, Halifax customers around £888m.
The Lloyds customers spent £71m on protection premiums, while Halifax customers spent £170m on protection products.
The FCA acknowledged that rises in the stock market may mean that "customer detriment" may be low and consequently any compensation on the investment products may be lower.
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