Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 1206

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 3
Chunk 1206
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28,353  
    $98,840  
    $78,210 
  
    Assumed losses and loss adjustment expenses 
     —  
     —  
     — 
  
    Ceded losses and loss adjustment expenses 
     (4,847) 
     (40,944) 
     (25,528)
  
    Net losses and loss adjustment expenses 
    $23,506  
    $57,896  
    $52,682 

72 

Intercompany Reinsurance Pooling Arrangement

Effective January 1, 2020, all of our insurance subsidiary and affiliate
companies entered into an intercompany reinsurance pooling agreement. Nodak Insurance is the lead company of the pool, and assumes the
net premiums, net losses, and underwriting expenses from each of the other five companies. Nodak Insurance then retrocedes balances back
to each company, while retaining its own share of the pool’s net underwriting results, based on individual pool percentages established
in the respective pooling agreement. This arrangement allows each insurance company to rely upon the capacity of the pool’s total
statutory capital and surplus. As a result, they are evaluated by AM Best on a group basis and hold a single combined financial strength
rating, long-term issuer credit rating, and financial size category. Subsequent to the June 30, 2024, date of sale, Westminster is no
longer a member of the pool, and the pooling percentages for the remaining insurance subsidiaries were updated based on their respective
surplus as a percentage of the pool as of December 31, 2023.

7.       Deferred
Policy Acquisition Costs

Expenses directly related to successfully acquired insurance
policies, primarily commissions, premium taxes and underwriting costs, are deferred and amortized over the terms of the policies. We update
our acquisition cost assumptions periodically to reflect actual experience, and we evaluate the costs for recoverability. The table below,
presented on a consolidated basis, including both continuing and discontinued operations, shows the deferred policy acquisition costs
and asset reconciliation:

    Year Ended December 31, 

    2024  
    2023  
    2022 
  
    Balance, beginning of year 
    $34,120  
    $29,768  
    $24,947 
  
    Deferral of policy acquisition costs 
     79,363  
     87,343