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

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1
Chunk 10
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 percentage of premiums as their primary compensation from us. The Risk Management Agency of
the U.S. Department of Agriculture (“RMA”) establishes the maximum commission that can be paid to agents with respect to crop
insurance policies. Nodak Insurance, Battle Creek, American West, and Direct Auto pay annual profit-sharing commissions with respect to
all property and casualty (non-crop) business based on company-specific production metrics related to premiums and profitability.

Our marketing efforts are further supported by
our claims philosophy, which is designed to provide prompt and efficient service and claims processing, resulting in a positive experience
for agents and policyholders. We believe that these positive experiences contribute to achieving higher policyholder retention and new
business growth over time. While we rely on our captive and independent agents for distribution and customer support, underwriting and
claim handling responsibilities are retained by us. Many of our agents have had direct relationships with us for a number of years.

Underwriting, Risk Assessment, and Pricing

We strive to be disciplined in our pricing by
pursuing rate increases to maintain or improve our underwriting profitability while still being able to attract and retain customers.
We utilize pricing reviews that we believe will help us price risks more accurately, maintain appropriate policyholder retention, and
support the production of profitable new business. These pricing reviews involve 

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evaluating our claims experience and loss trends on a
periodic basis to identify changes in the frequency and severity of our claims. We then consider whether our premium rates are adequate
relative to the level of underwriting risk as well as the sufficiency of our underwriting guidelines.

The nature of our business requires that we remain
sensitive to the marketplace and the pricing strategies of our competitors. Using the market information as a reference point, we typically
set our prices based on our estimated future costs. From time to time, we may reduce our discounts or apply a premium surcharge to achieve
an appropriate return. Pricing flexibility allows us to provide a fair rate commensurate with the assumed risk. If our pricing strategy
cannot yield sufficient premium to cover our costs on a particular type of risk, we may choose not to underwrite that risk. It is our
philosophy not to sacrifice profitability for premium growth.

Enterprise Risk Management

Our Company is subject to significant risks, including
the normal risks of a property and casualty insurance company. These risks are discussed in more detail in Part I, Item 1A, “Risk
Factors.”

We consider an enterprise-wide risk management