Company: NODK
Filing Date: 2025-05-09
Form Type: 10-Q
Source: 0001174947-25-000721
Chunk: 57

Company: NI Holdings, Inc.
Filing Date: 2025-05-09
Form: 10-Q
Item: Part I, Item 1
Chunk 57
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 months ended March 31, 2024. The change was primarily the result of changes in U.S.
interest rates. The change in the fair value of fixed income securities is not reflected in net income; rather it is reflected as a separate
component (net of income taxes) of other comprehensive income.

38 

Income before Income Taxes

For the three months ended March 31, 2025, we had pre-tax income of
$7,749 compared to a pre-tax income of $8,833 for the three months ended March 31, 2024. This change was attributable to the higher underwriting
loss in the Non-Standard Auto segment, and less favorable market conditions for equity investments, partially offset by earned premium
growth in our other segments, higher net investment income, and lower frequency of large loss experience in the Home and Farm segment.

Income Tax Expense

We recorded income tax expense of $1,289 for the three months ended
March 31, 2025, compared to income tax expense of $1,898 for the three months ended March 31, 2024. Our effective tax rate for the first
quarter of 2025 was 16.6% compared to an effective tax rate of 21.5% for the first quarter of 2024. The current quarter effective tax
rate was impacted by a change in our valuation allowance against deferred income tax assets.

Net Income

For the three months ended March 31, 2025, we had net income of $6,460
compared to net income of $6,935 for the three months ended March 31, 2024. This change was attributable to the higher underwriting loss
in the Non-Standard Auto segment, and less favorable market conditions for equity investments, partially offset by earned premium growth
in our other segments, higher net investment income, and lower frequency of large loss experience in the Home and Farm segment, and reductions
in income tax expense.

Return on Average Equity

For the three months ended March 31, 2025, we had annualized return
on average equity of 10.4% compared to 12.1% for the three months ended March 31, 2024.

Average equity is calculated as the average between beginning and ending
equity for the period.

Critical Accounting Policies

The preparation of financial statements in accordance with GAAP requires
both the use of estimates and judgment relative to the application of appropriate accounting policies. We are required