The direct mail order and online business predominantly sold items of clothing but it had the permission to sell general insurance products too.

These insurance products covered against accidental damage and theft for all products bought from their ‘Ace’ or ‘Studio’ brands.

It was called “Property Insurance” from January 2005 to August 2008 and “Purchase Protection Insurance” from September 2008 to May 2015, with the premiums calculated as a percentage of the customer account balance.

However following its own “quality assurance activity” the firm has agreed with the city watchdog, the Financial Conduct Authority (FCA), that the insurance cover sold did not provide adequate value to the 300,000+ customers.

This is because although it covered all items bought, its predominant business was selling items of clothing which customers don’t generally insure.

This cover is no longer offered by the firm but Express Gifts Ltd has agreed with the FCA to provide £12.5m redress to customers affected.

It will write to all affected customers with details of how they will be paid the redress due. Any redress will be sent automatically, so customers don’t need to do anything.

But the FCA recommends that if customers have any questions or would like further information, or their contact details have changed, they should contact Express Gifts Ltd directly.

Jonathan Davidson, director of supervision – retail and authorisations at the FCA, said: “We expect firms to identify where insurance products of little or no value have been sold to customers and take appropriate action. There is a responsibility on firms, whether they are responsible for the design or the distribution of these products, to ensure the products offer value for their customers.”