Company: NODK
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0001174947-25-000304
Chunk: 510

Company: NI Holdings, Inc.
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1B
Chunk 510
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 insure risk.

Due to the inherent uncertainty underlying loss reserve estimates,
final resolution of the estimated liability for unpaid losses and loss adjustment expenses may be higher or lower than the related loss
reserves at the reporting date. Therefore, actual paid losses, as claims are settled in the future, may be materially higher or lower
in amount than current loss reserves. We reflect adjustments to the liability for unpaid losses and loss adjustment expenses in the results
of operations during the period in which the estimates are changed.

40 

Investments

Our fixed income securities and equity securities are classified
as available-for-sale and carried at estimated fair value as determined by management based upon quoted market prices or a recognized
independent pricing service at the reporting date for those or similar investments. Changes in unrealized investment gains or losses on
the fixed income securities, net of applicable income taxes, are reflected directly in shareholders’ equity as a component of other
comprehensive income (loss) and, accordingly, have no effect on net income (loss). Changes in unrealized investment gains or losses on
equity securities are reported in net income (loss). Investment income from fixed income securities is recognized when earned, and realized
investment gains (losses) are recognized when investments are sold, the fair value of equity securities change, or credit impairments
are recognized.

For additional information on our investments,
see Part II, Item 8, Note 4 “Investments” and Note 5 “Fair Value Measurements.”

Deferred Policy Acquisition Costs

Certain direct policy acquisition costs consisting of commissions,
state premium taxes, and other direct underwriting expenses that vary with and are primarily related to the production of business are
deferred and amortized over the effective period of the related insurance policies as the underlying policy premiums are earned.

At December 31, 2024 and 2023, deferred policy
acquisition costs (“DAC”) and the related liability for unearned premiums were as follows:

    December 31, 

    2024  
    2023 
  
    Deferred policy acquisition costs 
    $26,300  
    $26,790 
  
    Liability for unearned premiums 
     126,498  
     126,100 

The method followed in computing DAC limits the
amount of deferred costs to their estimated realizable value, which gives effect to the premium to be earned, related investment income,
losses and loss adjustment expenses, and certain other costs expected to be incurred as the premium is earned. Future changes