Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 23

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1
Chunk 23
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 risk management approach that emphasizes long-term profitability over short-term gains in
premiums or market share, geographical diversification of our operations, and the use of reinsurance. However, there can be no guarantee
that our underwriting and risk management efforts will be successful in mitigating our exposure to catastrophe losses or the impact of
such losses when they occur. In addition, while we maintain reinsurance coverage with a catastrophe excess of loss program, such coverage
may be insufficient to cover our losses. Our reinsurance coverage includes a catastrophe excess of loss program, which in 2024 limited
our catastrophe exposure to $20 million retention per event, with $133 million of reinsurance coverage placed in excess of this retention.
For 2025, we expect our catastrophe excess of loss program will limit our catastrophe exposure to $20 million retention per event, with
$117 million of reinsurance coverage placed in excess of this retention. If we are not able to effectively mitigate our exposure to catastrophe
losses, whether through our underwriting process or reinsurance coverage, in the event of such losses our business and results of operations
could be adversely affected.

For additional information, see Part II, Item
8, Note 3 “Summary of Significant Accounting Policies and Basis of Presentation” and Note 6 “Reinsurance.”

If actual losses exceed our loss and loss
adjustment expense reserves or if changes in the estimated level of loss and loss adjustment expense reserves are necessary as a result
of changes in the legal, regulatory, and economic environments in which we operate, our financial results could be materially and adversely
affected.

We maintain reserves to cover estimated unpaid losses and expenses necessary
to settle claims. The reserves for losses and loss adjustment expenses that we have established are estimates of amounts needed to pay
reported and unreported claims and related expenses, based on facts and circumstances known to us at the time we established the reserves.
Reserves are actuarially projected based on historical claims information, industry statistics, anticipated trends, and other factors.
The process of estimating loss reserves involves a high degree of judgment and is subject to a number of variables. While we believe that
our reserves for unpaid losses and loss adjustment expenses are appropriate, to the extent that such reserves prove to be inadequate or
excessive in the future, we would adjust them and recognize the change in earnings in the period the reserves are adjusted. There can
be no assurance that the estimates of such liabilities will not change in the future and any such adjustment could have a material impact