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Royalties, Dividends, and Affiliations
 6 Months Ended
Jun. 30, 2024
Royalties, Dividends, and Affiliations [Abstract]  
Royalties, Dividends, and Affiliations

10.       Royalties, Dividends, and Affiliations

 

North Dakota Farm Bureau

 

Nodak Insurance was organized by the North Dakota Farm Bureau (“NDFB”) to provide insurance protection for its members. We have a royalty agreement with the NDFB that recognizes the use of their trademark and provides royalties to the NDFB based on the premiums written on Nodak Insurance’s policies. Royalties paid to the NDFB were $480 and $442 during the three months ended June 30, 2024 and 2023, respectively, and $883 and $799 for the six months ended June 30, 2024 and 2023, respectively. Royalty amounts payable of $175 and $131 were accrued as a liability to the NDFB at June 30, 2024, and December 31, 2023, respectively.

 

Dividends

 

State insurance laws require our insurance subsidiaries to maintain certain minimum capital and surplus amounts on a statutory basis. Our insurance subsidiaries are subject to regulations that restrict the payment of dividends from statutory surplus and may require prior approval from their domiciliary insurance regulatory authorities. Our insurance subsidiaries are also subject to risk-based capital requirements that may further affect their ability to pay dividends. Our insurance subsidiaries statutory capital and surplus at December 31, 2023, exceeded the amount of statutory capital and surplus necessary to satisfy risk-based capital requirements by a significant margin. For information regarding the availability of subsidiaries to pay dividends to NI Holdings during 2024, see Item II, Part 8, Note 12 “Related Party Transactions” section of the 2023 Annual Report.

 

Battle Creek

 

Prior to January 2, 2024, we consolidated the financial statements of Battle Creek, and Battle Creek’s policyholders’ interest in Battle Creek was reflected as a non-controlling interest in shareholders’ equity in our Consolidated Balance Sheets. Subsequent to January 2, 2024, Battle Creek is fully consolidated in our Consolidated Balance Sheets. The following table discloses the standalone balance sheet of Battle Creek, prior to intercompany eliminations, to illustrate the impact of including Battle Creek in our December 31, 2023, Consolidated Balance Sheet prior to demutualization:

 

   December 31, 2023 
Assets:     
Cash and cash equivalents  $2,621 
Investments   15,394 
Premiums and agents’ balances receivable   5,953 
Deferred policy acquisition costs   682 
Reinsurance recoverables on losses (2)   6,918 
Accrued investment income   85 
Income tax recoverable   225 
Deferred income taxes   706 
Property and equipment   306 
Other assets   97 
Total assets  $32,987 
      
Liabilities:     
Unpaid losses and loss adjustment expenses  $4,276 
Unearned premiums   3,269 
Notes payable (1)   3,000 
Pooling payable (1)   5,932 
Reinsurance losses payable (2)   13,275 
Accrued expenses and other liabilities   477 
Total liabilities   30,229 
      
Equity:     
Non-controlling interest   2,758 
Total equity   2,758 
      
Total liabilities and equity  $32,987 

 

(1)        Amount fully eliminated in consolidation.

(2)        Amount partly eliminated in consolidation.