Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 32

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1
Chunk 32
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 companies by assuming an increasingly higher portion of losses incurred by farmers
as a result of weather-related and other perils as well as commodity price fluctuations. The U.S. government also subsidizes the premium
cost to farmers for multi-peril crop yield and revenue insurance. Without this risk assumption, losses incurred by insurance companies
would be higher. Without the premium subsidy, the number of farmers purchasing multi-peril crop insurance would decline significantly.
Periodically, members of the U.S. Congress propose to significantly reduce the government’s involvement in the federal crop insurance
program in an effort to reduce government spending. If legislation is adopted to reduce the amount of risk the government assumes, the
amount of insurance premium subsidy provided to farmers or otherwise reduce the coverage provided under multi-peril crop insurance policies,
losses would increase and purchases of multi-peril crop insurance could experience a significant decline nationwide and in our market
area. Such changes could have an adverse effect on our revenues and income.

Our businesses are heavily regulated by the
jurisdictions in which we conduct business and changes in regulation, including required participation in pools, premium surcharges, and
higher tax rates, may reduce our profitability and limit our growth.

Most states require insurance companies authorized
to do business in their state to participate in guaranty funds, which require the insurance companies to bear a portion of the unfunded
obligations of impaired, insolvent, or failed insurance companies. These obligations are funded by assessments, which are expected to
continue in the future. State guaranty associations levy assessments, up to prescribed limits, on all insurance companies doing business
in the state based on their proportionate share of premiums written in the lines of business in which the impaired, insolvent, or failed
insurance companies are engaged. Accordingly, the assessments levied on us may increase as we increase our written premiums. For additional
information, see Part I, Item 1, “Business” and “Regulation.”

In addition, as a condition to conducting business
in some states, insurance companies are required to participate in residual market programs to provide insurance to those who cannot procure
coverage from an insurance carrier on a negotiated basis. Insurance companies generally can fulfill their residual market obligations
by, among other things, participating in a reinsurance pool where the results of all policies provided through the pool are shared by
the participating insurance companies. Although we price our insurance to account for our potential obligations under these pooling arrangements,
we may not be able to accurately estimate our liability for these