Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 263

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1A
Chunk 263
---
 liability for these obligations. Accordingly, mandatory pooling arrangements may cause a
decrease in our profits. As we write policies in new states that have mandatory pooling arrangements, we will be required to participate
in additional pooling arrangements. Further, the impairment, insolvency, or failure of other insurance companies in these pooling arrangements
would likely increase the liability for other members in the pool.

The effect of assessments and premium surcharges
or increases in such assessments or surcharges could reduce our profitability in any given period or limit our ability to grow our business.
In addition, state tax laws that specifically impact the insurance industry, such as premium taxes, or more general tax laws, such as
U.S. federal corporate income taxes, could be enacted or changed and could have a material adverse impact on us.

We are subject to insurance industry laws
and regulations, as well as claims and legal proceedings, which if determined unfavorably, could have a material adverse effect on our
profitability.

We are subject to extensive supervision and regulation
by the states in which we operate. The failure to comply with these regulations could subject the Company to sanctions and fines, including
the cancellation or suspension of our licenses, which could significantly impact our financial condition and results of operations. State
insurance departments also conduct periodic examinations of the affairs of insurance companies and require the filing of annual and other
reports relating to financial condition, holding company issues, and other matters.

Additionally, changes in the level of regulation
of the insurance industry or changes in laws or regulations themselves or interpretations by regulatory authorities could adversely affect
our ability to operate our business. Federal laws and regulations, and 

20 

the influence of international laws and regulations, may have adverse
effects on our business, potentially including a change from a state-based system of regulation to a system of federal regulation, the
repeal of the McCarran Ferguson Act, and/or measures under the Dodd-Frank Act that establish the Federal Insurance Office and provide
for a determination that a non-bank financial company presents systemic risk and therefore should be subject to heightened supervision
by the Federal Reserve Board. It is not known how this federal office will coordinate and interact with the NAIC and state insurance regulators.
Adoption or implementation of any of these measures may restrict our ability to conduct our insurance business, govern our corporate affairs,
or effectively manage our cost of doing business.

We also face a risk of litigation in the ordinary
course of operating our businesses including the risk of class action lawsuits. We may become subject to