COURT DIRECTS UTMOST WEALTH SOLUTIONS TO REIMBURSE INVESTOR $16,889 OVER “UNFAIR” POLICY TERM
Read Time:2 Minute, 36 Second
By: Fasasi Hammad
Delivering judgment on January 26, 2026, Justice K. A. Jose (Mrs.) ruled that the policy term allowing Utmost Wealth Solutions to allocate 100% of a customer’s premium payments during the initial period to administrative fees was unfair and violated consumer protection laws.
Mrs. Nwachukwu had filed the suit (LD/9332GCMW/2022) against Profinad Nigeria Limited, Utmost Wealth Solutions, and Ms. Nnite Chinwe Ogochukwu, seeking a declaration that the clause was invalid. She also demanded a refund of $18,000 invested under the “Vision Plan,” accrued interest of $2,106.84, N10 million in general damages, and legal costs.
In August 2014, Mrs. Nwachukwu was introduced by Profinad Nigeria Limited to a long-term savings and investment policy aimed at helping her “save and make money simultaneously.” She subscribed to the plan and paid $1,000 monthly premiums for 18 months until February 15, 2016, when she lost her job and could no longer continue payments. By June 8, 2016, her account had grown to $20,106.84, combining her $18,000 capital and $2,106.84 in accrued interest.
In June 2021, Profinad confirmed to the Canadian High Commission that Mrs. Nwachukwu held an active investment account with Utmost Wealth Solutions, naming her daughter as sole beneficiary, reinforcing her belief that the funds remained intact. However, when she requested a withdrawal in March 2022, she was informed the policy had lapsed in 2019 with “no value,” as all contributions had reportedly been used for administration fees.
The defendants relied on Clause 5.3 of the policy, stating that the first 100% of premiums during the initial 18.78 months of a 20-year plan would be applied to administrative charges for the entire policy period. Mrs. Nwachukwu contended she had not been informed that her contributions for nearly two years would be entirely consumed by fees, believing she could withdraw her funds at any time while retaining value.
The court evaluated the clause under Section 127 of the Federal Competition and Consumer Protection Act, which prohibits unfair or excessively one-sided contractual terms. Justice Jose found that the retention of all premiums and accrued interest, even after the policyholder stopped payments, was grossly one-Claims against Profinad Nigeria Limited and its managing director were dismissed, affirming that the contract was solely between Mrs. Nwachukwu and Utmost Wealth Solutions (formerly Generali International Limited).
While the clause was ruled invalid, the court allowed Utmost Wealth Solutions to deduct reasonable administrative fees for the period the policy was actively managed, calculated at 2% annually over eight years, totaling $3,217.09. Consequently, the company was ordered to refund $16,889.75 to Mrs. Nwachukwu.
The court rejected her N10 million claim for general damages, stating contractual damages are limited to foreseeable losses, but awarded N2 million in legal costs.
The ruling is expected to influence the management of long-term investment products in Nigeria, particularly policies with front-loaded fees that can erode investors’ capital during the early years of subscription. It underscores the courts’ commitment to protecting consumers against unfair contract terms in the financial sector.
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