Cigna Life Insurance has admitted misleading customers by increasing life insurance cover more than required to cover inflation

The admission is part of proceedings brought by the Financial Markets Authority, in the High Court at Wellington.

It's alleged Cigna breached Fair Dealing provisions of the Financial Markets Conduct Act 2013.

The claim involves more than 52-thousand policies, but FMA says the issue began in early 2013 when Cigna changed its indexation rates.

Cigna has repaid more than 10.7 million dollars' additional premiums to customers through its remediation programme.