Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 506

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1B
Chunk 506
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 This enables us to establish estimated damage amounts based on the wind speed and size of the hail for case or per claim loss
amounts. This process allows us to determine within a 

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reasonable time (5-7 days) an estimated number of claims and estimated losses from
the storm. We have also begun reviewing the results of the predicted cost of the claim generated by the catastrophe models as a reasonability
check on the anticipated cost of the storm. If we estimate the damages to be in excess of half of the retained catastrophe amount, reinsurers
are notified immediately of a potential loss so that we can quickly recover reinsurance payments once the retention is exceeded.

We estimate multi-peril crop insurance losses on a quarterly basis
based upon historical loss patterns, current crop conditions, current weather patterns, and input from crop loss adjusters. These estimates
have proven to be reasonably accurate indicators of our anticipated losses for this line of business.

Our actuaries assist with the estimation of the liability for unpaid
losses and loss adjustment expenses. The actuaries prepare estimates by first deriving an actuarially based estimate of the ultimate cost
of total losses and loss adjustment expenses incurred as of the financial statement date based on established actuarial methods as described
below. We then reduce the estimated ultimate loss and loss adjustment expenses by loss and loss adjustment expenses payments and case
reserves carried as of the financial statement date. The actuarially determined estimate is based upon indications from various actuarial
methodologies including paid chain-ladder, incurred chain-ladder, Bornhuetter-Ferguson, weighted averages of the methods, and judgment.
The specific method used to estimate the ultimate losses varies depending on the judgment of the actuaries as to what is the most appropriate
for the line of business. Management reviews these estimates and supplements the actuarial analysis with information not fully incorporated
into the actuarially based estimate, such as changes in the external business environment and internal company processes. Management may
adjust the actuarial estimates based on this supplemental information in order to arrive at the amount recorded in the consolidated financial
statements.

A further discussion of the actuarial methodologies used follows:

Bornhuetter-Ferguson Method - The Bornhuetter-Ferguson
Method is a blended method that explicitly considers both actual loss development to date and expected future loss emergence. This method
is applied on both a paid loss basis and an incurred loss basis. This method uses selected loss development patterns to calculate the
expected percentage of losses unpaid