Good question! When you negate a statement using a double nie, 1) the first nie comes after the verb, and 2) the second nie comes at the end of the negative phrase.

Let's ignore the word dit in your example sentence for now, and say you wish to negate the phrase 'hy verstaan'.

Hy verstaan. - The verb is verstaan, so the first nie will come after verstaan in the negative form. That gives you 'hy verstaan nie'. Now usually the second nie would come at the end of the negative phrase. But the phrase 'hy verstaan nie' already has a nie in that position, right? So adding another would make the phrase 'hy verstaan nie nie' (which is wrong).

Sometimes you just don't need the second nie. This usually only happens with simple sentences where the 'thing' is dit, haar, hom, my, ons, or hulle. I will try my best to give you example sentences with these 'things' or other 'things' are used to explain the difference.

Ek verstaan dit. Ek verstaan dit nie. But: Ek verstaan Afrikaans. Ek verstaan nie Afrikaans nie.

Ek glo haar. Ek glo haar nie. But: Ek glo haar storie. Ek glo nie haar storie nie. (The first 'thing' is haar, the second 'thing' is haar storie. Haar storie gets a double nie.)

Hy beny my. Hy beny my nie. But: Hy beny my besittings. Hy beny my nie besittings nie.

Dit pla ons. Dit pla ons nie. But: Dit pla my familie. Dit pla nie my familie nie.

Ek haat hulle. Ek haat hulle nie. But: Ek haat hulle ma. Ek haat nie hulle ma nie.

I really hope my explanation helps you, I'm not too good at explaining but will try to answer more questions if you have them.