205bc568596ef83869e3c8e1b71b0fea092b95245413835c2ec63ac53309002c

a8dd7df4d02bd306694691b258a1e9332a4f33392df5f9082e17191c7e72b0e2

| Metric [Unit: USD Million] | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|----------------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| **Underwriting & Rating**  | 444.4  **[0001437749-23-004943_ex_431591.htm:1]**  | N/A     | 478.1  **[0001437749-23-021528_ex_521059.htm:2]**  | 475.2  **[0001437749-23-029652_ex_559192.htm:1]**  | N/A     | 498.4  **[0001437749-24-014063_ex_631742.htm:1]**  | 507.5  **[0001437749-24-023985_vrsk20240630_10q.htm:34]**  | 506.9  **[0001437749-24-032536_vrsk20240930_10q.htm:33]**  |
| **Claims**                 | 186.0  **[0001437749-23-004943_ex_431591.htm:1]**  | N/A     | 196.9  **[0001437749-23-021528_ex_521059.htm:2]**  | 202.4  **[0001437749-23-029652_ex_559192.htm:1]**  | N/A     | 205.6  **[0001437749-24-014063_ex_631742.htm:1]**  | 209.3  **[0001437749-24-023985_vrsk20240630_10q.htm:34]**  | 218.4  **[0001437749-24-032536_vrsk20240930_10q.htm:33]**  |
| **Total Insurance**        | 630.4  **[0001437749-23-004943_ex_431591.htm:1]**  | 651.6  **[0001437749-23-012194_ex_470310.htm:2]**  | 675.0  **[0001437749-23-021528_ex_521059.htm:2]**  | 677.6  **[0001437749-23-029652_ex_559192.htm:0]**  | 677.2  **[0001437749-24-004938_ex_584024.htm:2]**  | 704.0  **[0001437749-24-014063_ex_631742.htm:1]**  | 716.8  **[0001437749-24-023985_vrsk20240630_10q.htm:34]**  | 725.3  **[0001437749-24-032536_vrsk20240930_10q.htm:33]**  |
| **Energy and Specialized Markets** | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     |
| **Financial Services**     | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     |

9964872296038366978f2d28aa36ce44265c2c573664358eb9e0cfa1e299b45f

5d4a8aa244906e80bb2d1b900f3171a8c2c7f0d7ebc609b8bd756798ae5882dc

Adjustments for Non-Cash Items [USD, Millions]

Stock-Based Compensation [USD, Millions]

Changes in Working Capital [USD, Millions]

Capital Expenditures (CapEx) [USD, Millions]

Proceeds from / Repayments of Debt [USD, Millions]

Share Repurchases [USD, Millions]

Dividend Payments [USD, Millions]

Net Change in Cash [USD, Millions]

8fdaae5070a0c4a238eb28b1982785ae6f61308aea438a254651b0811b3ca36d

Verisk is a leading data analytics and technology provider primarily serving the insurance industry, offering solutions that include predictive analytics and decision support for rating, underwriting, claims, catastrophe, and weather risk, among other fields **[0001437749-24-004939_vrsk20231231c_10k.htm:3]** **[0001437749-24-004939_vrsk20231231c_10k.htm:6]**. These solutions are integrated into client workflows to help them make better decisions about risk and improve operating efficiency **[0001437749-24-004939_vrsk20231231c_10k.htm:3]** **[0001437749-24-004939_vrsk20231231c_10k.htm:6]**. Verisk's business is structured around providing statistical, actuarial, and underwriting data, with a focus on the U.S. property and casualty (P&C) insurance industry, and also offers solutions for fraud detection, catastrophe modeling, and loss quantification **[0001437749-24-023985_vrsk20240630_10q.htm:23]** **[0001437749-24-032536_vrsk20240930_10q.htm:23]**. The company's revenue model is predominantly subscription-based, accounting for approximately 80% of its revenues, with the remaining 20% being transactional **[VRSK_3401181_18]** **[0001437749-24-004939_vrsk20231231c_10k.htm:6]**.

1. **Underwriting Solutions** - Provides forms, rules, and loss costs to help insurers define coverages, issue policies, and ensure compliance with regulatory requirements across various lines of insurance **[0001437749-24-004939_vrsk20231231c_10k.htm:6]**.
2. **Predictive Analytics and Decision Support** - Offers tools for rating, underwriting, claims, catastrophe, and weather risk to enhance decision-making and operational efficiency **[0001437749-24-004939_vrsk20231231c_10k.htm:3]** **[0001437749-24-004939_vrsk20231231c_10k.htm:6]**.
3. **Property Estimating Solutions** - Delivers comprehensive tools for property assessment and valuation, aiding in accurate and efficient property claims processing **[VRSK_3376643_2]**.
4. **Extreme Events Modeling** - Specializes in catastrophe modeling and loss quantification to help clients assess and manage risks associated with extreme events **[0001437749-24-023985_vrsk20240630_10q.htm:23]** **[0001437749-24-032536_vrsk20240930_10q.htm:23]**.
5. **Fraud Detection Solutions** - Provides advanced analytics to identify and mitigate fraudulent activities within the insurance sector **[0001437749-24-023985_vrsk20240630_10q.htm:23]** **[0001437749-24-032536_vrsk20240930_10q.htm:23]**.
6. **International and New Market Solutions** - Expands capabilities into international markets and new areas such as life insurance and annuities **[0001437749-24-004939_vrsk20231231c_10k.htm:6]**.

f6d867dc6b87d43d5867dc1ffa5f6ca581869995b362306d9fe15ded9cee1fbd

| Geographical Segment | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|----------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| United States (USD millions) | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | **593.6**  **[0001437749-24-023985_vrsk20240630_10q.htm:8]**  | **604.1**  **[0001437749-24-032536_vrsk20240930_10q.htm:8]**  |
| United Kingdom (USD millions) | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | **51.0**  **[0001437749-24-023985_vrsk20240630_10q.htm:8]**  | **53.3**  **[0001437749-24-032536_vrsk20240930_10q.htm:8]**  |
| Other Countries (USD millions) | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | **72.2**  **[0001437749-24-023985_vrsk20240630_10q.htm:8]**  | **67.9**  **[0001437749-24-032536_vrsk20240930_10q.htm:8]**  |
| Total Revenue (USD millions) | N/A     | N/A     | N/A     | N/A     | N/A     | N/A     | **716.8**  **[0001437749-24-023985_vrsk20240630_10q.htm:8]**  | **725.3**  **[0001437749-24-032536_vrsk20240930_10q.htm:8]**  |

6414cb1f6b30984cc168ec4bb13008937fa2f5a215a3ef4103308015069fb18b

1. Given the decline in transactional revenues this quarter and the ongoing transition from transactional to subscription models, can you provide more clarity on how this shift is impacting overall revenue growth and what measures you're taking to mitigate any negative effects on future quarters?
2. With indications that insurance pricing may peak in 2025 and considering that 20-25% of your revenue comes from contracts tied to net written premiums with a two-year lag, how do you plan to sustain revenue growth if the market enters a softer cycle?
3. You mentioned being at the bottom of your target leverage range and actively pursuing M&A opportunities; can you elaborate on specific areas or businesses you're targeting for acquisitions, especially in niches like life insurance where you've seen double-digit growth, and how you assess integration risks?
4. While you highlighted an 8% growth on a two-year stack exceeding historical rates, can you break down the specific contributions from pricing increases versus organic demand, and discuss the sustainability of this growth amid competitive pressures and potential market saturation in your core lines?
5. With significant investments in new products like the Experience Index and the Core Lines Reimagine initiative, how are you measuring the return on these investments, and what confidence can you provide that these innovations will drive meaningful revenue growth given evolving client needs and technological advancements in the industry?

ba3628c3469b9957ef9487cc48c56c8363c15cabe93d5010c1d505d43b72aad2

Insurance

- Underwriting

- Underwriting & Rating

- Claims

Specialized Markets

Energy and Specialized Markets

Financial Services

Healthcare

Industry-standard Insurance Programs

Property-specific Rating and Underwriting Info

Total Revenue

0200a5639201dfa0d36fa7fdb6777e67f2a5429629460e52019911887331a67b

### Q4 2023 Earnings Call
- **Issued Period**: Q4 2023
- **Guided Period**: FY 2024
- **Guidance**:
  - **Consolidated Revenue**: $2.84 billion to $2.9 billion  **[VRSK_3374218_7]** .
  - **Adjusted EBITDA**: $1.54 billion to $1.6 billion  **[VRSK_3374218_7]** .
  - **Adjusted EBITDA Margin**: 54% to 55%  **[VRSK_3374218_7]** .
  - **Depreciation and Amortization of Fixed Assets**: $210 million to $240 million  **[VRSK_3374218_7]** .
  - **Amortization of Intangibles**: Approximately $75 million  **[VRSK_3374218_7]** .
  - **Tax Rate**: 23% to 25%  **[VRSK_3374218_7]** .
  - **Adjusted Earnings Per Share**: $6.30 to $6.60 per share  **[VRSK_3374218_7]** .
  - **Capital Expenditures**: $240 million to $260 million  **[VRSK_3374218_7]** .

### Q1 2024 Earnings Call
- **Issued Period**: Q1 2024
- **Guided Period**: FY 2024
- **Guidance**:
  - **Consolidated Revenue**: $2.84 billion to $2.9 billion  **[VRSK_3381844_6]** .
  - **Adjusted EBITDA**: $1.54 billion to $1.6 billion  **[VRSK_3381844_6]** .
  - **Adjusted EBITDA Margin**: 54% to 55%  **[VRSK_3381844_6]** .
  - **Tax Rate**: 23% to 25%  **[VRSK_3381844_6]** .
  - **Adjusted Earnings Per Share**: $6.30 to $6.60 per share  **[VRSK_3381844_6]** .

### Q2 2024 Earnings Call
- **Issued Period**: Q2 2024
- **Guided Period**: FY 2024
- **Guidance**:
  - **Consolidated Revenue**: $2.84 billion to $2.9 billion  **[VRSK_3395274_6]** .
  - **Adjusted EBITDA**: $1.54 billion to $1.6 billion  **[VRSK_3395274_6]** .
  - **Adjusted EBITDA Margin**: 54% to 55%  **[VRSK_3395274_6]** .
  - **Adjusted Earnings Per Share**: $6.30 to $6.60  **[VRSK_3395274_6]** .
  - **Fixed Asset Depreciation**: Expected to be at the high end of the range due to new projects being put into service  **[VRSK_3395274_6]** .
  - **Tax Rate**: Expected to be at the low end of the 23% to 25% range, considering certain one-time discrete items for the first half of the year  **[VRSK_3395274_5]** .
  - **Net Interest Expense**: Expected to be slightly higher due to refinancing activities  **[VRSK_3395274_6]** .

### Q3 2024 Earnings Call
- **Issued Period**: Q3 2024
- **Guided Period**: N/A
- **Guidance**: The documents do not contain information about the Q3 2024 earnings call for Verisk (VRSK). Therefore, I cannot provide the guidance metrics from that specific earnings call.

04d6de8dd9baf22bfe9da2eae25c051c00f3374869acd9f8da8179b3c2b104f0

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

| Name                | Position                                      | Start Date       | Short Bio                                                                                                                                                                                                                                                                                                                                 |
|---------------------|-----------------------------------------------|------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Lee M. Shavel       | President and Chief Executive Officer         | May 2022         | Lee M. Shavel has been the **Chief Executive Officer** of Verisk Analytics, Inc. since **May 2022** and assumed the title of **President** in **January 2023**. He previously served as Verisk's Group President and Chief Financial Officer  **[0001193125-24-087955_d653310ddef14a.htm:28]** **[0001193125-24-087955_d653310ddef14a.htm:11]** **[0001193125-23-094781_d415034ddef14a.htm:11]** .                                                                                   |
| Elizabeth D. Mann   | Executive Vice President and Chief Financial Officer | September 2022   | Elizabeth D. Mann has been the Executive Vice President and Chief Financial Officer at Verisk since **September 2022**. She was previously the CFO of the Ratings and Mobility divisions at S&P Global and held various positions at Goldman Sachs  **[0001193125-24-087955_d653310ddef14a.htm:28]** **[0001193125-23-094781_d415034ddef14a.htm:28]** .                                                                               |
| Nick Daffan         | Executive Vice President and Chief Information Officer | July 2015        | Nick Daffan has been the **Chief Information Officer** since July 2015 and **Executive Vice President** since December 2018. He is responsible for technology strategy, operations, and the delivery of data and analytics  **[0001193125-24-087955_d653310ddef14a.htm:28]** **[0001193125-23-094781_d415034ddef14a.htm:28]** .                                                                                                        |
| Kathy Card Beckles  | Executive Vice President and Chief Legal Officer | April 2021       | Kathy Card Beckles has been the **Executive Vice President and Chief Legal Officer** at Verisk Analytics since **April 2021**. She provides leadership for all legal aspects of the business and oversees corporate governance, compliance, and internal audit functions  **[0001193125-24-087955_d653310ddef14a.htm:28]** **[0001193125-23-094781_d415034ddef14a.htm:29]** .                                                          |
| Sunita Holzer       | Executive Vice President and Chief Human Relations Officer | August 2021      | Sunita Holzer has been the **Chief Human Relations Officer** at Verisk since **August 2021**. She leads all aspects of the company's human resources strategy and operations, bringing three decades of HR leadership experience  **[0001193125-24-087955_d653310ddef14a.htm:28]** **[0001193125-23-094781_d415034ddef14a.htm:29]** .                                                                                                   |
| Greg Hendrick       | Independent Director                          | April 1, 2024    | Gregory Hendrick was appointed to the Board of Directors of Verisk Analytics, Inc. on **April 1, 2024**. He has over 35 years of experience in insurance and reinsurance leadership, including as CEO of Vantage Group and AXA XL  **[0001193125-24-087955_d653310ddef14a.htm:9]** **[0000950170-24-043694_xslF345X02/ownership.xml:0]** .                                                                                                 |

ec77e3a1edd5d1b58fc4bec85f6dab4ca354cf6fff62be0ab23cb1b60c33235c

| Program Details          | Program 1          | Program 2          | Program 3          | Program 4          |
|--------------------------|--------------------|--------------------|--------------------|--------------------|
| Approval Date            | December 2023  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**   | March 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**      | June 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**       | August 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**  |
| End Date/Duration        | February 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**   | April 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**      | July 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**       | October 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]** |
| Total additional amount  | $250.0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**  | $200.0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**  | $150.0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]**  | $400.0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**  |
| Remaining authorization  | $0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**   | $0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**   | $0 million  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**   | **$891.5 million**  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**  |
| Details                  | N/A                | N/A                | N/A                | Overall authorization available as of September 30, 2024  **[0001437749-24-032536_vrsk20240930_10q.htm:17]** **[0001437749-24-032536_vrsk20240930_10q.htm:48]**  |

ff7e50bf07eed3daeadeaeb24a6db32b6f74e63794d074bf8f0467cfe4c2fc10

United States

United Kingdom

Other countries

- Revenues from countries outside of the U.S. (%)

10a1e9f9c766c28c362a8a5691113cc6a9e7ac364e018f207264f384792d84a1

**Quarterly guidance for Q4 2024:**
- **Effective Tax Rate**: 23% to 25%  **[VRSK_3404637_5]**  (no prior guidance)

**Annual guidance for FY 2024:**
- **Consolidated Revenue**: $2.84B to $2.9B  **[VRSK_3404637_6]**  (no change from $2.84B to $2.9B  **[VRSK_3395274_6]** )  
- **Adjusted EBITDA**: $1.55B to $1.6B  **[VRSK_3404637_6]**  (raised from $1.54B to $1.6B  **[VRSK_3395274_6]** )  
- **Adjusted EBITDA Margin**: 54% to 55%  **[VRSK_3404637_6]**  (no change from 54% to 55%  **[VRSK_3395274_6]** )  
- **Adjusted Earnings Per Share (EPS)**: $6.30 to $6.60  **[VRSK_3404637_6]**  (no change from $6.30 to $6.60  **[VRSK_3395274_6]** )  
- **Fixed Asset Depreciation**: Expected to be at the high end of the range due to new projects being put into service  **[VRSK_3404637_6]**  (no change from prior guidance  **[VRSK_3395274_6]** )  
- **Net Interest Expense**: Slightly higher due to refinancing activities  **[VRSK_3404637_6]**  (no change from prior guidance  **[VRSK_3395274_6]** )  

688f7b0892ba4b4b48eb67bbda2be6ce4820c26cd60790fd12d6cf00d061cea4

| Name                  | Start Date | End Date | Reason for Change |
|-----------------------|------------|----------|-------------------|
| Deloitte & Touche LLP | 2001  **[0001437749-24-004939_vrsk20231231c_10k.htm:92]**  | Present  | Current auditor   |

4df62d8e2028d0143c670a5d3e60ada705f766290a288d2cf094a1f48ae2f245

8b5a90e82d831fb92e9654050971ee63c4138dd18ec067cffd6dd0f9199875d1

- Total Revenue: $725.3M (+7% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:8]** **[0001437749-24-032536_vrsk20240930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:8]**   
- Insurance Segment: $725.3M (+7% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:8]** **[0001437749-24-032536_vrsk20240930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:41]** **[0001437749-23-029653_vrsk20230930_10q.htm:29]** **[0001437749-23-029653_vrsk20230930_10q.htm:36]**   
- United States Revenue: $604.1M (+7% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:8]** **[0001437749-23-029653_vrsk20230930_10q.htm:8]**   
- United Kingdom Revenue: $53.3M (+10% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:8]** **[0001437749-23-029653_vrsk20230930_10q.htm:8]**   
- Other Countries Revenue: $67.9M (+6% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:8]** **[0001437749-23-029653_vrsk20230930_10q.htm:8]**   
- Operating Income: $311.5M (+11% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:25]** **[0001437749-24-032536_vrsk20240930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:29]** **[0001437749-23-029653_vrsk20230930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:8]**   
- Net Income: $22M (**-88%** YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:25]** **[0001437749-24-032536_vrsk20240930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:5]** **[0001437749-23-029653_vrsk20230930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:6]**   
- Diluted EPS: $1.55 (+23% YoY)  **[0001437749-24-032536_vrsk20240930_10q.htm:25]** **[0001437749-24-032536_vrsk20240930_10q.htm:3]** **[0001437749-23-029653_vrsk20230930_10q.htm:3]**   

79f476bd5b781ff7e28931ee47c9f171cdfabac50e4e7275fd811e74200d8223

a979fb9cf8486577393fd32837755d897f7b59bf9d8c0786e4b603e3c066028d

Year-over-year underwriting revenue growth (percentage)

Year-over-year underwriting revenue growth excluding recent acquisitions (percentage)

Year-over-year claims revenue growth (percentage)

Year-over-year claims revenue growth excluding recent acquisitions (percentage)

Year-over-year total insurance revenue growth (percentage)

Year-over-year total insurance revenue growth excluding recent acquisitions (percentage)

fa47b023e6a400abc04b09087a9de723f292b34f5278cd25a73b6a763201b4d4

| Year | Amount Due (in millions) | Debt Type | Interest Rate | % of Total Debt |
|------|--------------------------|-----------|---------------|-----------------|
| 2025 | $500.0 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 4.000% Senior Notes **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 4.000% **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 16.3% = (500 / 3,063) * 100 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** **[0001437749-24-032536_vrsk20240930_10q.htm:15]** |
| 2029 | $600.0 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 4.125% Senior Notes **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 4.125% **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 19.6% = (600 / 3,063) * 100 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** **[0001437749-24-032536_vrsk20240930_10q.htm:15]** |
| 2033 | $500.0 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 5.750% Senior Notes **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 5.750% **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 16.3% = (500 / 3,063) * 100 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** **[0001437749-24-032536_vrsk20240930_10q.htm:15]** |
| 2034 | $600.0 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 5.250% Senior Notes **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 5.250% **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 19.6% = (600 / 3,063) * 100 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** **[0001437749-24-032536_vrsk20240930_10q.htm:15]** |
| 2045 | $350.0 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 5.500% Senior Notes **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 5.500% **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 11.4% = (350 / 3,063) * 100 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** **[0001437749-24-032536_vrsk20240930_10q.htm:15]** |
| 2050 | $500.0 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 3.625% Senior Notes **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 3.625% **[0001437749-24-032536_vrsk20240930_10q.htm:15]** | 16.3% = (500 / 3,063) * 100 **[0001437749-24-032536_vrsk20240930_10q.htm:15]** **[0001437749-24-032536_vrsk20240930_10q.htm:15]** |

d0c232d7a9751b69ebf3d08d6bae4268ba1a4317d0cfcf7b771d850233dc30f3

1. **Margin Outlook**
   **Q:** What's changed in your margin guidance?  
   **A:** Our 2024 adjusted EBITDA margin guidance is **54% to 55%**  **[VRSK_3374218_16]** , a slight tightening from the Investor Day range of **54% to 56%**.  **[VRSK_3374218_16]**  The difference is due to three incremental investments since then: in our sales force, international expansion through M&A, and investments in generative AI.  **[VRSK_3374218_16]**  Despite these, we're still delivering **100 basis points** of margin expansion  **[VRSK_3374218_16]** , and compounded with prior expansions, we're ahead of our previous targets.  **[VRSK_3374218_16]** 

2. **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.  **[VRSK_3374218_9]**  For 2024, we expect the hard market to persist, but transactional activity and weather to normalize.  **[VRSK_3374218_9]**  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.  **[VRSK_3374218_12]** 

3. **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.  **[VRSK_3374218_10]**  These pricing improvements are factored into our 2024 guidance.  **[VRSK_3374218_22]**  They support our longer-term **6% to 8%** growth target  **[VRSK_3374218_22]**  and occur across our business as we deliver value-driven pricing to our clients.  **[VRSK_3374218_22]** 

4. **Generative AI Initiatives**
   **Q:** What benefits do you expect from generative AI this year?  
   **A:** We're excited about new products leveraging **generative AI**.  **[VRSK_3374218_13]**  In our claims business, we've deployed AI in data extraction and medical file summarization, enhancing automation and client value.  **[VRSK_3374218_13]**  We're also exploring applying low and no-code technology from our life insurance business to P&C.  **[VRSK_3374218_13]**  These investments are part of our growth strategy and factor into our capital allocation.  **[VRSK_3374218_23]** 

5. **Transaction Revenue Outlook**
   **Q:** How will transaction revenue trend in 2024?  
   **A:** After strong **double-digit** transactional growth in 2023  **[VRSK_3374218_24]** , we're lapping elevated periods. Key drivers like auto shopping activity and weather trends are expected to normalize.  **[VRSK_3374218_24]**  We're not assuming elevated weather activity, and auto shopping trends will begin to return to historical levels.  **[VRSK_3374218_24]** 

6. **Free Cash Flow Growth**
   **Q:** How should we expect free cash flow to grow?  
   **A:** Our Insurance business generates strong free cash flow.  **[VRSK_3374218_21]**  We expect it to grow roughly in line with our bottom line.  **[VRSK_3374218_21]**  While we don't give specific guidance, our confidence is demonstrated by our commitment to increasing the dividend.  **[VRSK_3374218_21]** 

7. **Capital Allocation Priorities**
   **Q:** How should we view capital allocation moving forward?  
   **A:** Our capital management focuses on returns on invested capital.  **[VRSK_3374218_23]**  We'll invest organically and pursue M&A opportunities generating returns above our cost of capital.  **[VRSK_3374218_23]**  If we don't find such opportunities, we'll return capital to shareholders.  **[VRSK_3374218_23]**  Our incremental returns on invested capital this year were approximately **19%**.  **[VRSK_3374218_23]** 

8. **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.  **[VRSK_3374218_19]**  We're also structuring pricing to align with clients' perception of value.  **[VRSK_3374218_19]**  This investment contributes to our margin outlook while supporting growth.  **[VRSK_3374218_16]** 

fc030eca4de4bff066e4bff03b2611205b5b9ffa6f82e29f3b874ccdc263fdba

1. **P&C Industry Outlook**  
   **Q:** How is the P&C insurance industry's health impacting Verisk?  
   **A:** The property and casualty insurance industry is showing **strong premium growth** and **improved profitability**, resulting in **stronger combined ratios**.  **[VRSK_3381844_8]**  This positive outlook benefits Verisk, as they participate in clients' premium growth and see insurers more engaged in investing to improve their business.  **[VRSK_3381844_8]** 

2. **Subscription Revenue Growth**  
   **Q:** Is current subscription growth sustainable this year?  
   **A:** Subscription growth is **strong and broad-based**, driven by **forms, rules, and loss cost**, **antifraud solutions**, and **extreme events**.  **[VRSK_3381844_13]**  Verisk expects no significant changes and sees **no major quarterly variations** ahead.  **[VRSK_3381844_13]** 

3. **Pricing Environment**  
   **Q:** How do you view the pricing environment this year?  
   **A:** Verisk sees **positive tailwinds** in pricing tied to **net written premium growth**, **in line with last year**.  **[VRSK_3381844_11]**  The industry's financial strength makes clients more receptive, aiding in good pricing outcomes.  **[VRSK_3381844_11]** 

4. **New Solutions and GenAI Adoption**  
   **Q:** Which new solutions are gaining traction?  
   **A:** Verisk is seeing strong adoption of new products like **Discovery Navigator in claims**, **image forensics in antifraud**, **Core Lines Reimagine**, and **Next Generation Models in extreme events**.  **[VRSK_3381844_10]**  These innovations are contributing to **incremental revenue growth** incorporated into their guidance.  **[VRSK_3381844_10]** 

5. **Auto Telematics Discontinuation**  
   **Q:** Why discontinue the auto telematics offering?  
   **A:** Data providers ceased collecting data, leaving insufficient analytical value.  **[VRSK_3381844_12]**  The financial impact is **small**, and Verisk continues to serve auto insurers significantly with other products like **LightSpeed auto**, **coverage verifier**, and **damage assessment**.  **[VRSK_3381844_12]** 

6. **Catastrophe Bond Business**  
   **Q:** What's driving growth in the catastrophe bond market?  
   **A:** **Increased catastrophe risk** and the need for **diversifying investors** are driving the strong cat bond market.  **[VRSK_3381844_20]**  Verisk benefits by providing models and risk assessments through their **extreme event** business.  **[VRSK_3381844_20]** 

7. **Transactional Revenue Outlook**  
   **Q:** Are transactional revenues facing headwinds?  
   **A:** Yes, due to **tough comparisons** from last year's strong growth in areas like **auto shopping activity**, **elevated weather patterns**, and **securitization activity**.  **[VRSK_3381844_15]**  These create headwinds for transactional revenue in coming quarters.  **[VRSK_3381844_15]** 

8. **Investment Levels in AI and Platforms**  
   **Q:** How are internal investments affecting CapEx?  
   **A:** Investments in AI and replatforming are within expectations and embedded in guidance.  **[VRSK_3381844_14]** **[VRSK_3381844_17]**  Some projects are finite, so investment levels may reduce after completion.  **[VRSK_3381844_17]**  Verisk is integrating **generative AI** into existing products using current financial models.  **[VRSK_3381844_17]** 

9. **Capital Allocation and M&A**  
   **Q:** What's the outlook for small-to-medium M&A?  
   **A:** **Valuations remain high**, making attractive returns challenging.  **[VRSK_3381844_16]**  Verisk focuses on opportunities where they can add value and accelerate adoption but remains disciplined in capital allocation.  **[VRSK_3381844_16]** 

10. **Next-Generation Nat Peril Model**  
    **Q:** What's the impact of the new nat peril model?  
    **A:** The **Next Generation Models** are major enhancements, allowing clients to better estimate and quantify **uncertainty of losses**.  **[VRSK_3381844_18]**  It's a substantial opportunity to deliver more value, and expectations are reflected in guidance.  **[VRSK_3381844_18]** 

86cdaa8411027ae2962fdc861b5237a6b43731cb0b07e6a4ad4e199a5dc49f3a

- **Transactional revenue is expected to face headwinds** due to tough comparisons from last year's strong performance, particularly in auto transactional shopping activity and elevated weather patterns, potentially leading to **slower growth in the upcoming quarters**.  **[VRSK_3381844_21]**
- **Subscription revenue growth has decelerated** from 9% in the early part of last year to 7%-8% over the past two quarters, with potential headwinds including **attrition and industry consolidation**.  **[VRSK_3381844_3]**
- The **normalization of the market may result in future pressure on margins**, which could negatively impact subscription and transactional revenue growth as the industry adjusts to a more stable pricing environment.  **[VRSK_3381844_8]**

9f3bfcb517ec804e36087dc0e9d224412aef71386b5925d24695f75bb8f1619d

- **Strong Growth in Subscription Revenue Driven by Investments and Customer Engagement:** Verisk expects continued strength in subscription revenue, historically making up **80%** of total revenue, driven by investments in products, customer engagement, and industry expertise, enhancing renewals, attracting new customers, and enabling better pricing.  **[VRSK_3381844_0]** **[VRSK_3381844_8]**
- **Financial Strength of Clients Leading to Increased Demand:** The Property & Casualty insurance industry is experiencing **strong premium growth** and improving profitability, making clients more engaged in investing to improve their business. This benefits Verisk through increased demand for its solutions and participation in clients' premium growth.  **[VRSK_3381844_15]**
- **Leveraging Advanced Technologies and Product Enhancements for Future Growth:** Verisk is capitalizing on **Generative AI** and launched **Next Generation Models** in their extreme events business. These advancements represent major enhancements, enabling clients to better estimate and quantify uncertainties in losses, and position Verisk for future growth.  **[VRSK_3381844_22]** **[VRSK_3381844_18]**

643dde3175d01b0c1d9c5f9fb75c7f4df0c042263cfa66ccdea55160d062c53f

- **Verisk delivered robust year-to-date performance with revenue growth expected to be approximately 8% to 9% on a reported basis, which is above their long-term targets.**  **[VRSK_3363254_8]**
- **Successful execution of expense program has resulted in margin expansion, with over 90% of the benefit experienced in 2023, and continued focus on cost efficiency is expected to drive further improvements.**  **[VRSK_3363254_17]**
- **Strong growth and substantial opportunities in the international business, which represents about 17% of total revenues, with positive contributions from Specialty Business Solutions and claims services in the UK and Europe.**  **[VRSK_3363254_19]**

5d4c50b4f06a14ff69f4fef4b349bc6c0bf16db1b153ee2e0bd6fa56b2a19d28

1. **2025 Outlook and Potential Headwinds**  
**Q:** Is 2025 setting up for an outsized year of growth, or are there headwinds?  
**A:** Elizabeth Mann acknowledged tailwinds such as strong subscription momentum and a continued strong premium environment.  **[VRSK_3404637_8]**  However, she identified potential headwinds including the longer cycle of elevated premium growth, carriers focusing on profitability and evaluating their lines of business and overall spend, and the possibility of normalization of attrition, which has been a boost over the last couple of years.  **[VRSK_3404637_8]**  Despite these factors, she stated that Verisk sees strong momentum in the business.  **[VRSK_3404637_8]** 

2. **Subscription Revenue Growth Drivers**  
**Q:** What drove the acceleration of subscription revenue growth in Q3?  
**A:** Elizabeth Mann explained that the accelerating subscription growth is seen across all businesses and isn't due to any one factor.  **[VRSK_3404637_10]**  The drivers include focused go-to-market strategies, enhanced client engagement, and strength from product development and innovation.  **[VRSK_3404637_10]**  This growth is supported by the tailwind of premium growth, with momentum from new sales, conversions to subscription, upsizing usage, and adding Verisk products.  **[VRSK_3404637_10]** 

3. **Bookings Trends and Sales Strategy**  
**Q:** How are bookings trending, and what is driving the subscription momentum?  
**A:** Elizabeth Mann stated that bookings are trending well, with subscription growth driven by overall strength, including acquiring new customers and strong sales.  **[VRSK_3404637_15]**  Lee Shavel added that sales results have been strong relative to expectations, reflecting changes in the go-to-market strategy such as focusing territories, changing incentives, and higher-level enterprise discussions opening up opportunities to make more value-driven sales at a senior level.  **[VRSK_3404637_15]** 

4. **Guidance for 4Q and Full Year**  
**Q:** Are you being conservative with the guidance, given the wide range implied for Q4?  
**A:** Elizabeth Mann reaffirmed the 2024 revenue and adjusted EBITDA guidance and indicated that, with one quarter left, they are very much in line with the full-year range.  **[VRSK_3404637_19]**  She noted that their intention has always been to provide a full-year estimate rather than quarterly updates.  **[VRSK_3404637_19]** 

5. **Impact of Hurricanes and Revenue Mix**  
**Q:** How will Hurricanes Helene and Milton affect Q4 results and future tailwinds?  
**A:** Elizabeth Mann mentioned that it's early to quantify the impact of Hurricanes Helene and Milton.  **[VRSK_3404637_9]**  Verisk estimates insured losses at **$6–$11 billion** for Helene and **$30–$50 billion** for Milton.  **[VRSK_3404637_9]**  While combined losses are similar to Hurricane Ian, the flow-through can vary based on factors like the number of assignments and type of peril.  **[VRSK_3404637_9]**  She also noted that customers are converting contracts from transactional to subscriptions, which may reduce transactional swings from single storms.  **[VRSK_3404637_9]**  The transition to subscription has been a win-win, reflected in subscription growth.  **[VRSK_3404637_9]** 

6. **Auto Shopping Trends and Growth Impact**  
**Q:** How are auto shopping trends affecting growth, and what is the outlook?  
**A:** Elizabeth Mann acknowledged that this is the first quarter where auto shopping activity turned from a tailwind to a headwind.  **[VRSK_3404637_18]**  The headwinds are playing out as expected, and while she couldn't quantify future impacts, she noted that comparisons continue to be challenging on the transactional side of the auto business.  **[VRSK_3404637_18]** 

7. **Core Lines Reimagine Progress**  
**Q:** Where are you in the Core Lines Reimagine journey, and what impact does it have?  
**A:** Elizabeth Mann stated that they are slightly more than halfway through the Core Lines Reimagine program.  **[VRSK_3404637_12]**  They track progress by the number of new insights delivered and customer adoption.  **[VRSK_3404637_12]**  New innovations like the Experience Index have been launched for five of six major lines of business, with the sixth to launch next year.  **[VRSK_3404637_12]**  The Future of Forms initiative will continue to be part of major updates.  **[VRSK_3404637_12]**  The engagement platform at core.verisk.com has seen engagement levels multiple times higher than before.  **[VRSK_3404637_12]**  These innovations are driving usage at customers, leading to value for Verisk.  **[VRSK_3404637_12]** 

8. **International Business Growth and M&A Plans**  
**Q:** What is driving the international business growth, and are there M&A opportunities?  
**A:** Elizabeth Mann highlighted strength in several international businesses, including the life, health, and travel business expanding into new regions.  **[VRSK_3404637_23]**  The Opta business in Canada contributed to growth, benefiting from the integration of Verisk data sets.  **[VRSK_3404637_23]**  Claims businesses in Germany have also been performing well.  **[VRSK_3404637_23]**  She indicated that international expansion is an area where they will continue to look for potential acquisitions.  **[VRSK_3404637_23]** 

9. **Extreme Event Solutions Customer Growth**  
**Q:** Where are the new Extreme Event Solutions customers coming from, and what's driving interest?  
**A:** Elizabeth Mann noted that of the ten new customers, nine are new to the modeling space entirely.  **[VRSK_3404637_17]**  This reflects a broader interest in adding specific modeling information around climate change and its impacts.  **[VRSK_3404637_17]**  Growth is seen particularly in segments like excess and surplus lines of insurance and managing general agents, significant growth areas in the industry.  **[VRSK_3404637_17]**  An executive added that heightened catastrophe loss activity has led more market participants to seek better understanding and quantification of risks, driving interest in Extreme Event modeling solutions.  **[VRSK_3404637_17]** 

10. **GenAI Applications and Discovery Navigator**  
**Q:** Can you provide more color on the Discovery Navigator tool and GenAI capabilities?  
**A:** Lee Shavel explained that within claims, they have been deploying Generative AI solutions both internally and externally to help clients with talent augmentation, modernization, and productivity.  **[VRSK_3404637_20]**  The Discovery Navigator is an AI-driven automation innovation in the medical data extraction space that helps extract specific data elements, organize and catalog them, and provide executive summaries to case files.  **[VRSK_3404637_20]**  They are also innovating in the property estimating space with adjuster co-pilot transcription summaries and loss note summaries.  **[VRSK_3404637_20]**  Additionally, Verisk is integrating GenAI into several products to improve efficiency and productivity for clients.  **[VRSK_3404637_20]** 

11. **Insurance Industry Trends and Verisk's Role**  
**Q:** How is Verisk assessing the industry's focus on profitability amid current changes?  
**A:** Lee Shavel stated that improvements in premium growth and combined ratios reflect continued interest in Verisk's data and analytics to make better risk decisions.  **[VRSK_3404637_11]**  Verisk is helping carriers improve internal processes by automating functions and integrating data into workflows.  **[VRSK_3404637_11]**  He mentioned the integration of external parties in the insurance ecosystem, such as the whitespace platform in London, to improve efficiency and data quality for underwriters.  **[VRSK_3404637_11]** 

12. **Transactional to Subscription Conversion**  
**Q:** Will the conversion from transactional to subscription revenue be a notable headwind?  
**A:** Elizabeth Mann explained that the impact of contract conversions will be felt for approximately a year from the second quarter.  **[VRSK_3404637_13]**  However, she didn't view it as a headwind overall since it's a shift from transactional to subscription revenue.  **[VRSK_3404637_13]**  Lee Shavel added that the adjustment was a specific geographic shift and doesn't impact the longer-term growth opportunity in both transactional and subscription businesses.  **[VRSK_3404637_13]** 

13. **Guidance Details and Interest Expense**  
**Q:** Can you walk through the moving pieces on guidance, including interest expense and FX?  
**A:** Elizabeth Mann noted that guidance ranges are for the full year.  **[VRSK_3404637_22]**  The **60 basis point** FX benefit to margins in Q3 was not contemplated in the guidance and is not forecasted for Q4.  **[VRSK_3404637_22]**  Interest expense was **$32 million** this quarter, up from **$29 million** a year ago.  **[VRSK_3404637_22]**  This could be considered a reasonable run rate, though net interest expense may go up over time if interest rates earned on cash balances decline.  **[VRSK_3404637_22]**  She confirmed that there is no change in the underlying business relative to prior guidance.  **[VRSK_3404637_22]** 

9e1777bf2cc8ca1c567625a39afcf6f1edd6f7c0d7aebe2a49441f068a2a6cf4

- **Decline in Verisk Marketing Solutions due to lower advertising spend:** Verisk is experiencing declines in its Verisk Marketing Solutions business because insurance carriers are reducing advertising budgets. Carriers are focusing on profitability from their existing customer base, leading to **lower overall advertising spend** and impacting Verisk's marketing solutions revenue.  **[VRSK_3363254_21]**
- **Anticipated slowdown in growth for Q4 2023:** Despite a strong Q3 performance, Verisk maintained its full-year guidance, implying a potential slowdown in Q4. The company acknowledges that growth comparisons will be tougher due to prior year benefits from storm revenue and tax benefits, which may not recur, potentially affecting Q4 results.  **[VRSK_3363254_7]**
- **Potential decrease in transactional revenue in 2024:** Verisk's strong growth in 2023 was partly driven by higher levels of transactional activity in auto and property due to increased shopping and weather events. The company notes that these levels may not be sustained into 2024, indicating potential challenges in maintaining current growth rates.  **[VRSK_3363254_10]**

75ad55a74e41d39e27fde48483f2e55ab54ea7efac677f0019cdb3d4bc19e762

- **Expected slowdown in transactional revenue growth in 2024 as auto insurance shopping activity and elevated weather-related boosts normalize, potentially impacting overall revenue growth.**  **[VRSK_3374218_24]** **[VRSK_3374218_9]** **[VRSK_3374218_11]**
- **Continued weakness in the Marketing Solutions business due to insurance carriers not yet resuming their marketing spend, which could weigh on subscription revenue growth.**  **[VRSK_3374218_12]**
- **Increased capital expenditures, including investments in generative AI and international expansion, leading to lower free cash flow in the near term and a slight reduction in adjusted EBITDA margin guidance for 2024 compared to previous targets.**  **[VRSK_3374218_21]** **[VRSK_3374218_16]**

3ed87115b06c7aa4d627c861cf200d959cf3c0638d1a39cd52004966c6466b4d

1. **Transaction to Subscription Impact**  
   **Q:** What's the impact of transitioning from transaction to subscription?  
   **A:** The shift from transactional to subscription revenue models is impacting growth comparisons. A significant contract transitioned from transactional last year to subscription this year, contributing to the **weakness in transactional revenue growth** this quarter.  **[VRSK_3395274_14]**  This transition is occurring across multiple products and may cause periodic impacts on growth, but it's expected to benefit long-term sustainability.  **[VRSK_3395274_10]** 

2. **Drivers of Revenue Growth**  
   **Q:** What are the components of the 8% growth and its sustainability?  
   **A:** Growth is driven by increased demand for Verisk's products as clients face challenges in underwriting and claims.  **[VRSK_3395274_8]**  Success in **capturing more value** from investments and innovations enables continued growth.  **[VRSK_3395274_8]**  Strong performance in Specialty Business Solutions, international markets, and the life insurance business contributes to sustainability.  **[VRSK_3395274_8]**  Elevated strategic dialogue with clients is opening new opportunities, supporting long-term growth.  **[VRSK_3395274_8]** 

3. **Transactional Revenue Decline**  
   **Q:** Why did transactional revenue decline by 3% this quarter?  
   **A:** The **3% decline in transactional revenue** is due to exceptional **high levels of auto shopping activity** and **weather-related claims** in the prior year, creating tough comparisons.  **[VRSK_3395274_9]** **[VRSK_3395274_20]**  Additionally, the shift of revenues from transactional to subscription models is impacting year-over-year comparisons.  **[VRSK_3395274_9]** **[VRSK_3395274_20]**  Despite the year-over-year decline, transactional revenues grew sequentially from the first quarter.  **[VRSK_3395274_20]** 

4. **Guidance and Margin Outlook**  
   **Q:** Does maintaining guidance imply a slowdown in EPS growth?  
   **A:** Maintaining guidance reflects expectations of **seasonality in margins**, timing of spending, and planned investments in the business.  **[VRSK_3395274_17]**  Certain tax benefits realized in the first half are not expected to continue, affecting the **EPS growth rate** in the second half.  **[VRSK_3395274_17]** 

5. **Pricing Dynamics and Market Outlook**  
   **Q:** How will future pricing and the hard market affect growth?  
   **A:** While acknowledging that the hard market won't last forever, Verisk has historically grown through both hard and soft markets by continuing to deliver value to clients.  **[VRSK_3395274_16]**  Investments in core lines and innovations, such as the **Experience Index**, enhance client value and support their **3-4% pricing target**.  **[VRSK_3395274_18]**  Strong client feedback suggests potential to achieve the higher end of pricing expectations.  **[VRSK_3395274_18]** 

6. **Auto Insurance Market Share**  
   **Q:** Is Verisk gaining or losing share in auto insurance?  
   **A:** Auto insurance shopping-related revenue continued to grow but is experiencing **deceleration due to tough year-over-year comparisons**.  **[VRSK_3395274_12]**  Verisk believes it is **generally maintaining market share** in the auto insurance market.  **[VRSK_3395274_12]** 

7. **Client Relationships and Disintermediation**  
   **Q:** How are relationships with smaller clients, and is there disintermediation risk?  
   **A:** Verisk continues to deliver value across all client segments, with smaller and midsized clients benefiting proportionally more from Verisk's scale and data.  **[VRSK_3395274_13]**  There is **no evidence of higher attrition or disintermediation** among smaller clients.  **[VRSK_3395274_13]**  Verisk's stability and reliability help mitigate risks associated with clients adopting new technology vendors.  **[VRSK_3395274_13]** 

8. **Capital Deployment and M&A Strategy**  
   **Q:** What are the plans for capital deployment and M&A?  
   **A:** With leverage at the **bottom end of the target range (2-3x)**, Verisk is willing to deploy capital to support the business.  **[VRSK_3395274_19]**  They remain active in M&A markets, focusing on unique businesses in the insurance sector where Verisk has a **unique reason to be the right owner**.  **[VRSK_3395274_19]** 

9. **Experience Index Reception**  
   **Q:** How is the new Experience Index being received?  
   **A:** The **Experience Index** has received **very positive feedback**, providing clients with more current data and industry benchmarking.  **[VRSK_3395274_21]**  Clients are eager for expansion into other lines of business, indicating strong demand for this innovation.  **[VRSK_3395274_21]** 

10. **Life Insurance Solutions Growth**  
    **Q:** What's happening with life insurance solutions growth?  
    **A:** Life insurance solutions continue to contribute to growth, generally achieving **double-digit growth rates**.  **[VRSK_3395274_11]**  Although specific revenue breakdowns are not provided, life insurance remains a strong area of growth.  **[VRSK_3395274_11]** 

11. **Underwriting Solutions Deceleration**  
    **Q:** What's causing deceleration in underwriting revenue?  
    **A:** The deceleration is primarily due to a slowdown in **auto insurance shopping activity**, which impacts the **underwriting data analytics solutions** segment.  **[VRSK_3395274_15]**  While core growth is strong, transactional headwinds are affecting overall underwriting growth.  **[VRSK_3395274_15]** 

12. **Impact of Insurance Cycle**  
    **Q:** Does pricing peak in 2025 insulate Verisk into 2027?  
    **A:** Verisk does not consider itself insulated from market cycles.  **[VRSK_3395274_16]**  Even though **20-25% of revenue** comes from contracts tied to premium growth with a **two-year lag**, they must continue delivering value to sustain growth through different market conditions.  **[VRSK_3395274_16]** 

13. **Additional Products Moving to Subscription**  
    **Q:** Will more products transition to subscription models?  
    **A:** The transition from transactional to subscription revenue is occurring across various businesses.  **[VRSK_3395274_10]**  While the overall subscription-to-transactional revenue mix remains steady at **approximately 80-20**, further conversions may periodically impact growth comparisons.  **[VRSK_3395274_10]** 

14. **Underwriting Activity Drivers**  
    **Q:** What factors are driving underwriting activity?  
    **A:** Underwriting activity is influenced by factors such as **auto insurance shopping activity**, which falls under underwriting data analytics solutions.  **[VRSK_3395274_15]**  Changes in transactional revenues and market conditions also play significant roles.  **[VRSK_3395274_15]** 

2c4758d918bf425a4db4ad6a4ca53fece472bdacd2765de75be64c5d22d786bd

- Verisk is investing in growth opportunities, including expansion of its sales force, international expansion via M&A, and investments in generative AI to drive new products, which are expected to enhance revenue growth and create long-term value.  **[VRSK_3374218_16]**
- The company is delivering margin expansion while balancing investments in growth, with adjusted EBITDA margins expected to improve by **100 basis points** in 2024 on top of previous years' increases, showcasing operational efficiency and profitability.  **[VRSK_3374218_16]**
- Verisk has strong free cash flow generation, expected to grow roughly in line with the bottom line, and has demonstrated confidence through a commitment to **increase the dividend**, indicating shareholder-friendly capital allocation.  **[VRSK_3374218_21]**

3a2dd147a89ecf4bd5ffe31f31e9f7d86167ef9b471aa3ffa0c96839261c0022

- **Potential slowdown in revenue growth as the hard insurance market softens:** Elizabeth Mann, CFO, acknowledged that they are not insulated from the insurance cycle turning from a hard to a soft market, stating, "*I would not go so far as to say we are insulated.*"  **[VRSK_3395274_16]**
- **Near-term headwinds in the property business due to challenging market conditions:** The company mentioned that market conditions, such as carriers restricting underwriting or exiting certain markets due to catastrophic losses, may present "*some headwinds for our predominantly subscription property business*" in the near term.  **[VRSK_3395274_1]**
- **Diminishing impact of transaction-to-subscription conversions on growth:** CEO Lee Shavel noted that the boost from converting transactional contracts to subscriptions will be "*a diminishing impact over time,*" which could affect future growth rates as this effect lessens.  **[VRSK_3395274_8]**

77c7b9358df2aa972127a9e10865058b7116f2c90ad47cd59cfd87a526a92951

- **Positive client reception of new products like the Experience Index is driving strong subscription growth**. Customers have provided very positive feedback, expressing a desire for more frequent data and new lines of business. This innovation is leading to increased value capture from greater currency of data.  **[VRSK_3395274_21]**
- **Strategic capital deployment through active M&A to acquire unique businesses that enhance Verisk's offerings**. Verisk remains active in M&A markets, focusing on businesses that are unique in their markets and that serve the insurance industry, which can drive future growth.  **[VRSK_3395274_19]**
- **Transition from transactional to subscription-based contracts enhances consistency of growth and supports higher growth rates**. The shift to subscription models is happening across various solutions, converting temporary assignments or pilots into longer-term contracts, which is expected to continue supporting revenue growth.  **[VRSK_3395274_8]**

e567877d37ef279b321fb52f49b236f48de35e302c949ada3655a89b92affa8f

Verisk Analytics Inc (VRSK)

Financials