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Item 9A. Controls and Procedures

2023-03-08 compared with 2022-03-09 · 146 added, 79 removed, 127 unchanged (64% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

The Company’s Chief Executive Officer and Chief Financial Officer have reviewed and evaluated the effectiveness of the Company’s disclosure controls and procedures (as required by Exchange Act Rules 240.13a-15(b) and 15d-14(a)) as of December 31, 2021.

Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s current disclosure controls and procedures are effective.

Evaluation of Internal Controls over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as that term is defined in Rule 13a-15(f) under the Exchange Act.

Under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer, our management has reviewed and evaluated the effectiveness of our internal control over financial reporting based on the framework and criteria established in Internal Control –

Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Framework”).

Based on our evaluation under the COSO Framework, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s current internal control over financial reporting is effective, and that our Consolidated Financial Statements we include in this Annual Report on Form 10-K present fairly, in all material respects, our financial position, results of operations, and cash flows in conformity with accounting principles generally accepted in the United States of America.

Changes in Internal Controls

In the ordinary course of business, we periodically review our system of internal control over financial reporting to identify opportunities to improve our controls and increase efficiency, while ensuring that we maintain an effective internal control environment.

In addition, when we acquire new businesses, we incorporate our controls and procedures into the acquired business as part of our integration activities.

Since 2018, we have invested significant resources to comprehensively document and analyze our system of internal control over financial reporting.

We have identified areas requiring improvement, and continue to make selected improvements to processes and controls to address issues identified through this review.

These improvements may include such activities as implementing new, more efficient systems, automating manual processes, formalizing policies and procedures, increasing monitoring controls, and updating existing systems.

We plan to continue this initiative as well as prepare for the first audit of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002 for the annual period ending December 31, 2022, which may result in changes to our internal control over financial reporting.

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the year ended December 31, 2021, to which this report relates that have materially affected, or are reasonably likely to materially affect the Company’s internal control over financial reporting.

The Company’s Chief Executive Officer and

Chief Financial Officer have reviewed and evaluated the effectiveness of the Company’s disclosure controls and procedures (as required

by Rules 13a-15(b) and 15d-15(b) under the Exchange Act) as of December 31, 2022.

Based on that evaluation, the Chief Executive Officer

and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures, as of the end of the period covered

by this report, were designed and functioning effectively to provide reasonable assurance that the information required to be disclosed

in our periodic reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified

in the SEC’s rules and forms, and that such material information is accumulated and communicated to the Chief Executive Officer

and Chief Financial Officer to allow timely decisions regarding required disclosures.

We believe that a control system, no matter how

well designed and operated, cannot provide absolute assurance that the objectives of the control system are met, and no evaluation of

controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.

Management’s Report on Internal Control over Financial

Our management is responsible for establishing

and maintaining adequate internal control over financial reporting.

Under the supervision and with the participation of our Chief Executive

Officer and our Chief Financial Officer, our management has reviewed and evaluated the effectiveness of our internal control over financial

reporting based on the framework and criteria established in Internal Control – Integrated Framework (2013) issued by the Committee

of Sponsoring Organizations of the Treadway Commission (the “COSO Framework”).

Because of its inherent limitations, internal

control over financial reporting may not prevent or detect misstatements.

Based on our evaluation under the COSO Framework,

the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s current internal control over financial

reporting is effective at December 31, 2022, and that our consolidated financial statements we include in this 2022 Annual Report present

fairly, in all material respects, our financial position, results of operations, and cash flows in conformity with accounting principles

generally accepted in the United States of America.

Mazars USA LLP, our independent registered public

accounting firm, has issued an audit report on the effectiveness of our internal control over financial reporting as of December 31, 2022.

This audit report appears in Part II, Item 8.

Financial Statements and Supplementary Data, of this 2022 Annual Report.

Changes in Internal Control over Financial Reporting

In the ordinary course of business, we periodically review our system of internal control over financial reporting

to identify opportunities to improve our controls and increase efficiency, while ensuring that we maintain an effective internal control

We continued this initiative during the annual period ending December 31, 2022, in support of the first audit of our internal

control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act of 2002, which resulted in various enhancements

to our internal control over financial reporting.

Other Information

On March 7, 2022, the Board of Directors of the Company appointed Seth Daggett as the Company's Principal Accounting Officer.

Daggett will replace Timothy Milius as the Company's Principal Accounting officer.

Daggett will continue to serve as the Company's Chief Financial Officer and Treasurer.

Milius will continue to serve as the Secretary of the Company.

Further information about Mr.

Daggett may be found in the Company's Proxy Statement and Form 8-K filed on November 13, 2020, as amended on March 4, 2021.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

1 unchanged sentence

Directors, Executive Officers and Corporate Governance

We incorporate the response to this Item 10 by reference to our proxy statement we will file with the SEC on or about April 12, 2022 relating to our Annual Meeting of Shareholders that we will hold on May 24, 2022 (our “Proxy Statement”).

We have posted a copy of our Code of Ethics and Business Conduct on the Governance Highlights page of the Corporate Governance section of our website, www.niholdingsinc.com, which you can access free of charge.

Information contained on the website is not incorporated by reference in, or considered part of, this Form 10-K.

We intend to disclose on our website any amendments to, or waivers from, our Code of Ethics and Business Conduct that are required to be disclosed by law or NASDAQ Listing Rules.

We incorporate the response to this Item 10 by

reference to our proxy statement we will file with the SEC on or about April 11, 2023 relating to our Annual Meeting of Shareholders that

we will hold on May 23, 2023 (our “Proxy Statement”).

We have posted a copy of our Code of Ethics and

Business Conduct on the Governance Highlights page of the Corporate Governance section of our website, www.niholdingsinc.com ,

which you can access free of charge.

Information contained on the website is not incorporated by reference in, or considered part of,

this 2022 Annual Report.

We intend to disclose on our website any amendments to, or waivers from, our Code of Ethics and Business Conduct

that are required to be disclosed by law or NASDAQ Listing Rules.

Executive Compensation

We incorporate the response to this Item 11 by reference to our Proxy Statement.

We incorporate the response to this Item 11 by

reference to our Proxy Statement.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

We incorporate the response to this Item 12 by reference to our Proxy Statement.

We incorporate the response to this Item 12 by

reference to our Proxy Statement.

Certain Relationships and Related Transactions, and Director Independence

We incorporate the response to this Item 13 by reference to our Proxy Statement.

We incorporate the response to this Item 13 by

reference to our Proxy Statement.

Principal Accountant Fees and Services

We incorporate the response to this Item 14 by reference to our Proxy Statement.

We incorporate the response to this Item 14 by

reference to our Proxy Statement.

Exhibits and Financial Statement Schedules

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(2) Financial Statement schedules required to be filed by Item 8 of this report.

Schedule I Condensed financial information of registrant –

NI Holdings, Inc.

All other financial schedules are not required under the related instructions, as they are inapplicable or the information has been included in the Consolidated Financial Statements, and therefore have been omitted.

Schedule I Condensed financial information

of registrant – NI Holdings, Inc.

All other financial schedules are not required under the related

instructions, as they are inapplicable or the information has been included in the consolidated financial statements, and therefore have

been omitted.

(3) The following exhibits are required by Item 601 of Regulation S-K and are included as part of this Form 10-K:

2.1 Plan of Mutual Property and Casualty Insurance Company Conversion and Minority Offering of Nodak Mutual Insurance Company, dated as of January 21, 2016 (1)

2.1 Plan of Mutual Property and Casualty Insurance Company Conversion and Minority Offering of Nodak Mutual Insurance Company, dated

as of January 21, 2016 (1)

3.1 Articles of Incorporation of NI Holdings, Inc.

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Alexander and Nodak Mutual Insurance Company and NI Holdings, Inc.

10.4# Employment Agreement dated as of March 15, 2022, between Seth C.

Daggett and Nodak Insurance Company and NI Holdings, Inc.

10.5# Employment Agreement dated as of April 28, 2016, between Patrick W.

2 unchanged sentences

10.7 Multiple Peril Crop/Livestock Insurance Full Service Agency Agreement among American Farm Bureau Insurance Services, Inc.

and Nodak Mutual Insurance Company, American West Insurance Company and Battle Creek Mutual Insurance Company for Crop Year 2016 (1)

and Nodak Mutual

Insurance Company, American West Insurance Company and Battle Creek Mutual Insurance Company for Crop Year 2016 (1)

10.8 Crop Hail Insurance Full Service Agency Agreement among American Farm Bureau Insurance Services, Inc.

and Nodak Mutual Insurance Company, American West Insurance Company and Battle Creek Mutual Insurance Company for Crop Year 2016 (1)

and Nodak Mutual Insurance Company,

American West Insurance Company and Battle Creek Mutual Insurance Company for Crop Year 2016 (1)

10.9# Nodak Mutual Insurance Company Cash Incentive Bonus Plan (3)

8 unchanged sentences

Growth in Book Value Per Share Performance Share Unit Agreement (10)

10.16# 2022 NI Holdings, Inc.

Short-Term Incentive Bonus (11)

21.1* Subsidiaries of NI Holdings, Inc.

23.1* Consent of Mazars USA LLP, Fort Washington, PA, PCAOB 339

31.1* Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2* Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

23.1* Consent of Mazars USA LLP, Fort Washington, PA, PCAOB ID 339

31.1* Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934,

as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2* Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934,

as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32* Certification of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS** Inline XBRL Instance Document –

the instance document does not appear in the Interactive Data File

because its XBRL tags are embedded within the Inline XBRL document

Section 1350, as Adopted Pursuant

to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS** Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are

embedded within the Inline XBRL document

101.SCH** Inline XBRL Taxonomy Extension Schema Linkbase Document

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* Filed herewith.

** Inline XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

# Management contract or compensatory plan or arrangement.

(1) Filed as an exhibit to the Company’s Registration Statement on Form S-1 (File No.

333-214057) filed with the SEC on October 11, 2016, and incorporated herein by reference.

(2) Filed as an exhibit to Amendment No.

1 to the Company’s Registration Statement on Form S-1 (File No.

333-214057) filed with the SEC on November 14, 2016, and incorporated herein by reference.

(3) Filed as an exhibit to Amendment No.

4 to the Company’s Registration Statement on Form S-1 (File No.

333-214057) filed with the SEC on January 12, 2017, and incorporated herein by reference.

(4) Filed as Exhibit 3.1 to the Company’s Form 8-K (File No.

** Inline XBRL (Extensible

Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of

Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange

Act of 1934, as amended, and otherwise is not subject to liability under these sections.

# Management contract or

compensatory plan or arrangement.

(1) Filed as an exhibit

to the Company’s Registration Statement on Form S-1 (File No.

333-214057) filed with the SEC on October 11, 2016, and incorporated

herein by reference.

(2) Filed as an exhibit

to Amendment No.

1 to the Company’s Registration Statement on Form S-1 (File No.

333-214057) filed with the SEC on November 14,

2016, and incorporated herein by reference.

(3) Filed as an exhibit

to Amendment No.

4 to the Company’s Registration Statement on Form S-1 (File No.

333-214057) filed with the SEC on January 12, 2017,

and incorporated herein by reference.

(4) Filed as Exhibit 3.1

to the Company’s Form 8-K (File No.

001-37973) filed with the SEC on March 2, 2020, and incorporated herein by reference.

(5) Filed as Exhibit 10.1 to the Company’s Form 8-K (File No.

(5) Filed as Exhibit 10.1

to the Company’s Form 8-K (File No.

001-37973) filed with the SEC on September 18, 2017, and incorporated herein by reference.

(6) Filed as Exhibit 3.1 to the Company’s Form 8-K (File No.

(6) Filed as Exhibit 3.1

to the Company’s Form 8-K (File No.

001-37973) filed with the SEC on April 22, 2020, and incorporated herein by reference.

(7) Filed as an Exhibit to the Company’s Form 8-K (File No.

(7) Filed as an Exhibit

to the Company’s Form 8-K (File No.

001-37973) filed with the SEC on May 29, 2020, and incorporated herein by reference.

(8) Filed as an Exhibit to the Company’s Form 10-K (File No.

(8) Filed as an Exhibit

to the Company’s Form 10-K (File No.

001-37973) filed with the SEC on March 10, 2021, and incorporated herein by reference.

(9) Filed as an Exhibit

to the Company’s Form 8-K (File No.

001-37973) filed with the SEC on March 18, 2022, and incorporated herein by reference.

(10) Filed as Exhibit to

the Company’s Form 10-K (File No.

001-37973) filed with the SEC on March 9, 2022, and incorporated herein by reference.

(11) Filed as Exhibit

to the Company’s Form 10-Q (File No.

001-37973) filed with the SEC on May 6, 2022, and incorporated herein by reference.

Form 10-K Summary

Schedule I –

Condensed financial information of registrant –

Schedule I – Condensed financial information of registrant

– NI Holdings, Inc.

11 unchanged sentences

Total liabilities

Commitments and contingencies

Shareholders’

Shareholders’ equity

Total liabilities and equity

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Net investment income

Net capital gain on investments

Net investment gains (losses)

Total revenues

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Income (loss) before equity in undistributed net income of subsidiaries

Equity in undistributed net income of subsidiaries

Net income attributable to NI Holdings, Inc.

Equity in undistributed net income (loss) of subsidiaries

Net income (loss) attributable to NI Holdings, Inc.

Condensed Statements of Comprehensive Income

Year Ended December 31,

Net income attributable to NI Holdings, Inc.

Net income (loss) attributable to NI Holdings, Inc.

Other comprehensive income (loss), net of income taxes:

2 unchanged sentences

Other comprehensive income (loss), net of income taxes

Comprehensive income

Comprehensive income (loss)

Condensed Statements of Cash Flows

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Cash flows from operating activities:

Net income attributable to NI Holdings, Inc.

Net income (loss) attributable to NI Holdings, Inc.

Adjustments to reconcile net income (loss) attributable to NI Holdings, Inc.

to net cash flows from operating activities:

Equity in undistributed net income of subsidiaries

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Installment payment on Westminster consideration payable

Issuance of restricted stock awards

Issuance of vested award shares

Net cash flows from financing activities

Net (decrease) increase in cash and cash equivalents

Net decrease in cash and cash equivalents

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period

Note A –

Basis of presentation

In the parent-company-only financial statements, the Company’s investment in subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries since inception.

The parent-company-only financial statements should be read in conjunction with the Company’s Consolidated Financial Statements.

Note B –

Dividends from subsidiaries

The Company received a cash dividend of $6,000 from Nodak Insurance during the year ended December 31, 2020.

No dividends from its subsidiaries were received during the years ended December 31, 2021 or 2019.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on March 9, 2022.

Note A – Basis of presentation

In the parent-company-only financial statements, the Company’s

investment in subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries since inception.

The parent-company-only

financial statements should be read in conjunction with the Company’s consolidated financial statements.

Note B – Dividends from subsidiaries

The Company received cash dividends of $3,000 and $6,000 from Nodak

Insurance during the years ended December 31, 2022 and 2020.

No dividends from its subsidiaries were received during the year ended December

Pursuant to the requirements of Section 13 or 15(d) of the Securities

Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized

on March 8, 2023.

NI HOLDINGS, INC.

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(Principal Executive Officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on March 9, 2022, by the following persons on behalf of the registrant and in the capacities indicated.

Pursuant to the requirements of the Securities Exchange Act of 1934,

this report has been signed below on March 8, 2023, by the following persons on behalf of the registrant and in the capacities indicated.

/s/ Michael J.

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March 8, 2023

/s/ Prakash Mathew

March 8, 2023

Prakash Mathew

/s/ Jeffrey R.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures