NI Holdings Inc

The Compensation Committee, with analyses and advice from Meridian, considers current compensation levels and benchmarking data of peer companies, individual and Company performance, future leadership potential, and succession planning, among other factors, in determining appropriate target compensation levels for our NEOs. The Committee does not use a formula to weight these factors, but instead uses these factors to provide context within which to assess the significance of comparative market data and to differentiate the level of target compensation among our NEOs.

Consistent with our executive compensation philosophy, the Committee, in consultation with Meridian, establishes a benchmark peer group for compensation comparison purposes.

The Committee reviews, at least annually, the compensation peer group to confirm that it includes companies that are comparable to the Company on the basis of industry focus, scope of operations, size (based on revenues, assets, and/or market capitalization), and the competitive marketplace for talent (including other tangential, but related, industries). We use this data solely for informational purposes, and we do not make other pay decisions based on the market data alone.

In August 2022, the Committee reviewed the compensation peer group that would be used for compensation decision-making for fiscal year 2023. Protective Insurance Corporation was acquired by another corporation and was removed as a peer group company. Palomar Holdings, Inc. was added as a peer group company.

The Committee recognizes that certain companies in this group are larger than the Company, in some cases significantly so; nevertheless, they view this peer group as appropriate in light of the importance it ascribes to providing competitive compensation opportunities that are sufficient to attract and retain the talented executives needed to lead the Company.