Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 17

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1
Chunk 17
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four or more of its IRIS ratios fall outside the range deemed acceptable by the NAIC, an insurance company may receive inquiries from
individual state insurance departments. However, a ratio falling outside the usual range may not necessarily be considered adverse. In
some years, it may not be unusual for financially sound companies to have several ratios with results outside the usual ranges. During
the years ended December 31, 2024 and 2023, none of our insurance company subsidiaries produced results outside the acceptable range for
more than three of the IRIS tests. During the year ended December 31, 2022, our insurance company subsidiaries produced results outside
the acceptable range for as many as six of the IRIS tests, primarily driven by our significant net loss for the year that negatively impacted
IRIS ratios related to the operating ratio and certain ratios based on policyholders’ surplus.

Enterprise Risk Assessment

In 2012, the NAIC adopted various changes to its
Model Regulations (the “NAIC Amendments”). The NAIC Amendments, when adopted by the various states, are designed to respond
to perceived gaps in the regulation of insurance holding company systems in the U.S. The NAIC Amendments include a requirement that an
insurance holding company system’s ultimate controlling person submit annually to its lead state insurance regulator an “enterprise
risk report.” This enterprise risk report identifies the activities, circumstances, or events involving one or more affiliates of
an insurer that, if not remedied properly, are likely to have a material adverse effect upon the financial condition or liquidity of the
insurer or its insurance holding company system as a whole. The Company files a Form F Enterprise Report annually with each domiciliary
state in support of this requirement. The NAIC Amendments also include provisions requiring a controlling person to submit prior notice
to its domiciliary insurance regulator of its divestiture of control, having detailed minimum requirements for cost sharing and management
agreements between an insurer and its affiliates, and expanding of the agreements between an insurer and its affiliates to be filed with
its domiciliary insurance regulator.

In 2012, the NAIC also adopted the Own Risk Solvency
Assessment (“ORSA”) Model Act. The ORSA Model Act, when adopted by the various states, will require an insurance holding company
system’s chief risk officer to submit at least annually to its lead state insurance regulator a confidential report detailing its
own internal solvency assessment. Such an assessment is to be tailored to the nature, scale, and complexity