Margin Outlook Q: What's changed in your margin guidance?
A: Our 2024 adjusted EBITDA margin guidance is 54% to 55% , a slight tightening from the Investor Day range of 54% to 56%. The difference is due to three incremental investments since then: in our sales force, international expansion through M&A, and investments in generative AI. Despite these, we're still delivering 100 basis points of margin expansion , and compounded with prior expansions, we're ahead of our previous targets.

Revenue Growth Drivers Q: How do you view transaction growth and its drivers?
A: In 2023, our strength came from the hard insurance market, transactional rebound, and elevated weather activity. For 2024, we expect the hard market to persist, but transactional activity and weather to normalize. On the marketing side, carriers are starting to return to profitability, and we assume marketing spend will normalize in the second half of the year.

Pricing Opportunities Q: Can you elaborate on pricing opportunities impacting growth?
A: We've realized stronger pricing momentum than anticipated, particularly with our Core Lines Reimagine project. These pricing improvements are factored into our 2024 guidance. They support our longer-term 6% to 8% growth target and occur across our business as we deliver value-driven pricing to our clients.

Generative AI Initiatives Q: What benefits do you expect from generative AI this year?
A: We're excited about new products leveraging generative AI. In our claims business, we've deployed AI in data extraction and medical file summarization, enhancing automation and client value. We're also exploring applying low and no-code technology from our life insurance business to P&C. These investments are part of our growth strategy and factor into our capital allocation.

Transaction Revenue Outlook Q: How will transaction revenue trend in 2024?
A: After strong double-digit transactional growth in 2023 , we're lapping elevated periods. Key drivers like auto shopping activity and weather trends are expected to normalize. We're not assuming elevated weather activity, and auto shopping trends will begin to return to historical levels.

Free Cash Flow Growth Q: How should we expect free cash flow to grow?
A: Our Insurance business generates strong free cash flow. We expect it to grow roughly in line with our bottom line. While we don't give specific guidance, our confidence is demonstrated by our commitment to increasing the dividend.

Capital Allocation Priorities Q: How should we view capital allocation moving forward?
A: Our capital management focuses on returns on invested capital. We'll invest organically and pursue M&A opportunities generating returns above our cost of capital. If we don't find such opportunities, we'll return capital to shareholders. Our incremental returns on invested capital this year were approximately 19%.

Sales Force Investments Q: Can you provide more color on sales force investments?
A: We've aligned compensation structures with market levels to improve retention and focus on value-generating opportunities. We're also structuring pricing to align with clients' perception of value. This investment contributes to our margin outlook while supporting growth.