RISK FACTORS AND MITIGATING STRATEGIES
In formulating the consolidation and future plans of the Company, management has taken reasonable steps to identify the potential risks of the business and has devised effective strategies to mitigate the impact of those risks. The following are the risks peculiar to our business and the attendant strategies to mitigate the controllable risks:

Company-Specific Risk
This is the risk of loss due to failed internal processes, peoples and systems that can be adduced to poor management, lack of supervision, disruption of technological systems and inadequate accounting systems and controls. These risks are critical as they preclude organisations from achieving their business objectives.

Mitigating Strategy: As IGI pursues its capitalisation and expansion plans, the Company is also reviewing its internal processes and systems to ensure improved customer services, deployment of cutting-edge technologies, engaging and retaining professionals as well as consolidating on its financial strength

Sectoral Risks
The new recapitalisation directive in the Insurance Industry has introduced new challenges for Insurance companies and our Company in particular. The post-recapitalisation era will witness the emergence of few big players and hence increase the likelihood of market domination by these players. Consequently, we foresee an era where few firms compete to gain significant market share.

Mitigants: IGI has taken a bold step to comply with the recapitalisation directive and has also formulated strategies aimed at consolidating its leadership position in the market.

Political Risks
Political risks may arise from the actions or inaction of a foreign or domestic government, or a third party country which affect private business.

Mitigants: Nigeria is under democratic rule and therefore guided by the rule of law. The current government has put in place various policies tailored towards building a vibrant private sector led economy that should be sustained. It is anticipated that the transition to a new elected government in 2007 will be smooth and successful.

Currency Risks
This is the risk associated with the volatility in the exchange rate of the Naira to other currencies of the world.

Mitigants: The Central Bank of Nigeria has taken steps to promote the stability of the Naira via the introduction of the Wholesale Dutch Auction System (WDAS). Another factor supporting the stability of the Naira is the increasing volume of the Nigeria's foreign reserve which can be attributed mostly to high oil prices which we estimate will be sustained in the near future

Environmental Risks
Environmental issues such as pollution, natural disasters and fire outbreaks are a growing concern for many organisations because of the potential impact of disrupting business activities. The enforcement of environmental regulations through the criminal courts and, to a lesser degree, civil courts have raised its awareness.

Mitigants: IGI has formulated and implemented a policy to manage the potential impact of environmental risks. The Company is also ensuring compliance with all the environmental rules and regulation