Experience the Possible
Verisk is driving innovation on behalf of the insurance industry,
addressing the needs of the present and building for the future.
Our partnership with the industry invites insurance professionals
to reimagine their roles as facilitators of progress. Together, we
can build resilient communities and a future filled with possibilities.
About Verisk
Verisk (Nasdaq: VRSK) is a leading data, analytics and
technology provider serving clients in the insurance ecosys-
tem. Using advanced technologies to collect and analyze
billions of records, we draw on unique data assets, insurance
industry knowledge, and technological expertise to provide
valuable solutions that are integrated into client workflows.
We offer predictive analytics and decision support solutions
to clients in rating, underwriting, claims, catastrophe, weather
risk, and many other fields. In the United States and around
the world, we help clients protect individuals, communities,
and businesses. With teams across more than 20 countries,
Verisk consistently earns the Great Place to Work® Certified™
company designation and fosters an inclusive culture where
all team members feel they belong.
For more information, visit Verisk.com and the Verisk
Newsroom..
A Message to Our Shareholders
Delivering strong results as a newly insurance-
focused enterprise
In 2023, as a newly insurance-focused enterprise,
Verisk delivered organic constant currency (OCC)
revenue growth of 8.7% and OCC adjusted EBITDA
growth of 11.5%, exceeding the growth expecta-
tions we set at Investor Day. At the same time, we
expanded adjusted EBITDA margins by 150 bps to
53.5%, consistent with the expectations we set. In
addition, we returned $3 billion to shareholders in
dividends and share repurchases.
Lee M. Shavel
President and Chief Executive Officer
Diluted adjusted EPS from continuing operations of $5.71
in 2023 was up 14.0% from $5.01 the previous year,
reflecting top-line growth, operating leverage through
margin expansion and a reduced share count from the
application of excess capital generation to share repur-
chases. We also increased our dividend per share by 9.7%
in 2023 and recently announced a 15.0% increase for 2024.
We generated clear momentum on our three key priorities:
delivering consistent and predictable top-line growth,
driving operating efficiency and profitability, and ensuring
disciplined capital allocation. Our financial performance
reflected the results-oriented culture we emphasized at
Investor Day.
Our newly energized and refocused organization delivered
our strongest annual performance on record while embrac-
ing structural and organizational change. We intensified our
strategic engagement with clients to better understand
where we could invest to develop new solutions that meet
their most pressing needs in a challenging environment,
delivering value to the industry at a lower cost of invest-
ment and ownership.
Challenges for the insurance industry
continue to evolve
The risks that the insurance industry confronts in providing
coverage to their clients continue to evolve and expand,
requiring new data sets and better analytics. As an exam-
ple, while 2023 did not have a major tropical hurricane
make landfall in the U.S., wind and severe convective
storms were dominant with our own PCS data identifying
74 catastrophe events in 2023, the highest year on record
in terms of frequency. As another example, insurance fraud
is estimated to cost the industry more than $300 billion
each year and is expected to grow in a more digital
environment. Verisk is helping clients navigate these and
other evolving risks by providing a range of sophisticated
models, data analytics, and technologies that enable
insurers to do their important work, helping policyholders
obtain the best coverage and showing up for them on their
worst day.
Not only are the risks changing but the technology also
continues to evolve. Generative AI and cloud computing
are creating new opportunities to improve data analysis
and operating efficiencies, but they require technological
sophistication and significant investment to deliver
specific solutions for the insurance industry. Legacy
systems and processing continue to represent a challenge
for our clients as the costs to update and maintain them
are substantial. As a strategic data analytics and technol-
ogy partner, Verisk is using its deep domain and technolog-
ical expertise to develop solutions for the industry that
provide value with reduced investment and ownership
expenses.
Opportunity to innovate for the industry
continues to expand
Customer confidence and choice have put Verisk at the
center of a large and complex ecosystem that includes all
facets of the insurance industry and, ultimately, the
Experience the Possible / 1
businesses, communities, and consumers insurers serve.
Driven by new technologies, including cloud computing,
artificial intelligence, and machine learning, this ecosystem
is evolving rapidly. To help keep pace, new and relevant
data sets are expanding for more accurate risk assess-
ment, improved customer experience, and more efficient
claims processing.
Innovative technologies present opportunities to address
ongoing and emerging issues that have hindered the
industry: inflationary pressures, higher interest rates, rising
climate and social risks, sophisticated and evolving fraud
and cybersecurity threats, and a shortage of new talent
entering the industry. With more than 50 years of expertise
and a renewed focus on insurance, we are helping the
industry experience the possible as we unlock the power of
data and technology to create value for our clients and our
shareholders.
Delivering consistent and predictable
growth
We set clear and transparent growth goals at Investor Day
and exceeded them in 2023 as a demonstration of our
results-oriented culture and focus on execution. Continuing
to deliver strong growth relies on our ability to understand
and address our clients’ and the industry’s most pressing
needs with solutions that deliver tangible value.
We made substantial progress on our initiative to elevate
the strategic dialogue with our clients, and to become their
strategic data analytic and technology partner. During the
year, I met with over three dozen client CEOs and senior
leaders to discuss how we could better support their
objectives. Three primary themes came up repeatedly:
• How can Verisk accelerate and expand the delivery of
data and analytics to our organization?
• How can Verisk augment the capabilities of our
colleagues to improve their ability to manage the amount
of information they receive?
• How can Verisk help better connect the ecosystems we
operate in to improve our efficiency?
Our Core Lines Reimagine project, which is re-engineering
how we deliver our core data sets and analytics to meet the
rapidly evolving ingestion demands of our clients, rep-
resents our most substantial opportunity to improve and
accelerate the delivery of mission-critical data sets and
analytics. Prospectively, we see the application of low/
no-code and microservices technology that we have
successfully deployed in the Life Insurance industry as an
opportunity to better integrate data directly into our clients’
functions.
2 / Verisk 2023 Annual Report
Developing and applying generative AI technology through
our Discovery Navigator solution to accelerate the summa-
rization of large and complex medical files in our Casualty
business is one example of many where we are augmenting
the insurance professional’s ability to handle large amounts
of data more effectively. In addition, we have been develop-
ing and working with clients to refine several augmented
underwriting applications to improve the efficiency of that
function.
On connectivity, we have been investing in our Xactware
platform to support the integration of more ecosystem
partners. Recently, I attended our Elevate conference in Salt
Lake City which had record attendance from our insurance,
contractor, and adjuster clients and over 30 ecosystem
partners. Both clients and partners expressed enthusiasm
for our delivery of improved connectivity and efficiency,
demonstrating the network potential of this business.
Similarly, the recent addition of several significant insur-
ance brokers to our Whitespace platform has substantiated
the value of the ecosystem we have developed for the
London Excess & Surplus market.
Strategic conversations are also helping to drive more
informed innovation. In our conversations with clients, we
repeatedly hear about the increasing regulatory focus and
reporting requirements on fairness and unfair discrimina-
tion. To address this need, during the fourth quarter, we
launched FairCheck, a solution designed to assess the
underwriting process for potential unfair discrimination.
We’ve made this progress as we improved the efficiency
and power of our business.
Driving operating efficiency and profitability
In 2023, we delivered a 53.5% adjusted EBITDA margin, at
the mid-point of our initial guidance for 2023. This repre-
sented 150 bps of margin expansion from 2022 and
achieved the low-end of our overall margin improvement
goal from 2022 of 300 to 500 basis, a year earlier than
expected and with strong growth results. We expect to see
further improvement ahead through strong operating
leverage and active expense management actions. We are
leaning into our global talent optimization initiative, tapping
into the talent-rich and lower-cost markets like Krakow,
Poland, and Hyderabad, India. We have recently expanded
our real estate footprint in both markets to support our
growth.
Additionally, we will achieve savings as we modernize and
optimize our technology infrastructure across our legacy
systems, including our internal financial and human capital
ERP upgrade, which should start delivering early efficiency
benefits in 2025 with the full impact to be achieved in two
to three years. As we look further out, we see opportunity in
improving our operational efficiency by careful reviews of
our workflow and processes. We will continue to deploy our
Lean Six Sigma program to drive additional savings and
continue to focus on our organizational structure and
efficiency.
Allocating capital with discipline for strong
returns
In 2023, our return on invested capital was approximately
26%, with incremental returns on capital of approximately
19%, as we continue to invest our capital at high internal
rates of return. Disciplined capital allocation underscores
all our decision-making at Verisk. We invest our strong free
cash flow into value-creating opportunities that support
growth with attractive returns. Excess capital is returned to
shareholders through dividends and share repurchases.
We are excited about the many opportunities to invest
across our business in emerging technologies, including
generative AI, low/no-code applications, and international
expansion. We are also investing in upgrades and re-plat-
forming of our core solutions, some of which had been
underinvested and need modernization to support future
innovation.
We are also excited about the opportunities to continue to
create incremental value in our insurance-related acquisi-
tions. For example, in Claims we are driving growth and
synergies in our three recent acquisitions in Germany,
where we have a leading market position in the bodily injury
space and are adding services and technology offerings in
the auto and property spaces, through the acquisitions of
Actineo, Krug, and Rocket respectively. These acquisitions
enable us to deliver solutions and add value to our German
customers across the claims lifecycle.
Reimagining the future of insurance
While we are pleased with our results for 2023, our future
performance will require continued focus, energy, engage-
ment, and investment. Fortunately, our fundamental
economic model remains powerful: we invest in data and
technology at industry scale to deliver value to our clients
at a lower cost of investment and ownership. While
insurance industry challenges continue to evolve and
expand, our industry knowledge, existing relationships, and
technological expertise remain a valuable advantage in
pursuing that growing opportunity and generating value for
our clients and shareholders.
We are privileged to be a strategic data analytics and
technology partner to our clients, and we are excited about
our unique ability to reimagine and deliver the future of
insurance. We appreciate the trust our clients place in us
and their engagement with us to make the industry better.
By working together with the insurance industry, we are
building global resilience for individuals, communities, and
businesses.
Lee M. Shavel
President and Chief Executive Officer
Experience the Possible / 3
Experience the Possible / 3
Making a Difference for People,
Communities, and Businesses
During 2023, Verisk advanced important efforts across the environmental, social, and
governance landscape that deliver value for our stakeholders.
Working with purpose
Verisk is helping the American Red Cross strengthen its situational assessments of major catastrophic events,
such as hurricanes, by providing complimentary access to ALERT—real time information that goes beyond
meteorological data to include summaries of exposure at risk and potential impacts. The Red Cross will use
ALERT’s insured loss estimates—based on the event’s actual parameters calculated using Verisk extreme event
models specific to the location and peril—to better analyze and project deployment and resource priorities
earlier in their response process. Soon after the arrangement was finalized, the Red Cross accessed ALERT for
information about Hurricane Idalia.
Verisk’s comprehensive database of buildings and their characteristics has become an essential element of
geospatial models and planning tools being used by a range of public and private stakeholders in the UK to
identify and assess their future energy demands and potential decarbonization pathways. One such project
already underway – Project RESOP, or Regional Energy System Optimisation Planning – is integrating data from
4 / Verisk 2023 Annual Report
multiple sources, including Verisk, in a single tool to help
develop the roll out of low carbon technologies for individ-
ual communities such as Dundee, Scotland. The project is
modelling estimated demand building by building and the
impact of potential solutions across the community,
including the use of heat pumps, rooftop solar panels, and
charging points for electric vehicles.
Verisk’s emerging issues team continues to monitor a wide
range of developments and trends to help insurers and risk
management professionals better identify and understand
the risk exposures of the future. Among the topics they
spotlighted during 2023: the potential impact of droughts
on maritime shipping and associated supply chains, the
potential links between climate change and increased
seismic activity, and whether solar panels represent an
emerging fire risk.
Addressing climate risk
Verisk published its first-ever report in accordance with the
framework recommended by the Task Force on Climate-Re-
lated Financial Disclosures (TCFD).
In conjunction with the report, Verisk conducted quantita-
tive and qualitative climate scenario analyses to assess the
propriety of its current operating assumptions and strate-
gies associated with physical and transitional risks and the
alignment of existing climate adaptation plans. The
physical risk analysis covered four acute hazards (heat-
wave, hurricane/cyclone, inland flooding, and wildfire) and
two chronic hazards (sea level rise and water stress) and
was conducted using “middle of the road” and a “worst
case” scenario developed by the Intergovernmental Panel
on Climate Change (IPCC). The transition risk analysis
considered four potential categories of risk associated with
a low-carbon economy: Policy and legal, technology,
market, and reputational.
The report concluded that Verisk faces a low level of
exposure from the standpoint of physical climate-related
risk and proposed transition risk impacts, which are largely
mitigated by Verisk’s business sector and business model
resiliency.
The report also noted that Verisk exceeded its internal
target to reduce absolute Scope 1 and 2 emissions 21% by
2024 compared with a 2019 baseline. After discounting the
effects of the 3E and Financial Services divestments,
Verisk’s actual reduction through year-end 2022 was
approximately 30.5% compared with the 2019 baseline.
Meeting the expectations of employees
For the eighth consecutive year, Verisk was designated
as a Great Place to Work® Certified™ company for its
outstanding workplace culture in the United States;
fourth-time Certified™ in the United Kingdom, Spain, and
India, and second-time Certified™ in Poland. Employees
feel Verisk meets the benchmark for innovation, inclusivity,
company values, and leaders’ effectiveness.
Verisk adopted an Employee Health and Safety Policy,
which addresses the Company’s approach to promoting
the physical and mental well-being of employees.
Strengthening governance
In 2023 Verisk’s Board of Directors, led by its Audit
Committee, enhanced and strengthened its risk oversight
with processes like a risk review calendar and dashboard
that focused on mission critical risks at Committee
meetings throughout the year. To better organize and
delineate oversight of specific risk categories, the Board
formed a new Risk Committee in early 2024 which, in
coordination with the Audit Committee and other relevant
Committees as appropriate, oversees risk assessment and
risk management of the Company, reviews with manage-
ment matters relating to the policies, practices and
outcomes of the Company that relate to risk management,
and oversees the Company’s Enterprise Risk Management
function.
Verisk conducted its first human rights risk assessment to
identify potential areas of human rights risk in the Compa-
ny’s operations and supply chain. Although none of the
findings suggest a material risk, the Company adopted a
number of actions to strengthen risk mitigation strategies.
The Company also added a level of oversight to its
Whistleblower Program by appointing a committee to
review a broader scope of concerns, as well as their
investigation and resolution, to better identify root causes
and trends.
To learn more about these initiatives and many others, visit Verisk’s
ESG Resource Library or download the 2023 Verisk Corporate Social
Responsibility Report.
Great Place To Work® (and any other GPTW trademarks used) are
trademarks of Great Place To Work Institute Inc. claimed as such and/or
registered in the United States Patent and Trademark Office and elsewhere.
All other brand and product names are trademarks of their respective
holders.
Experience the Possible / 5
2023 Performance Snapshot
In 2023, we delivered strong growth in revenue and adjusted EBITDA from our newly
insurance-focused enterprise. While we continued to execute on our strategy to fur-
ther penetrate international insurance markets and adjacent new growth vectors, our
mission-critical solutions for the U.S. Property & Casualty Insurance industry remain
foundational and comprise the vast majority of Verisk revenue in 2023.
2023 Revenue Contribution
6 / Verisk 2023 Annual Report
Creating Substantial Client Value
Through Data & Innovation
Reimagining Our Solutions: Insights & Technology
Our statistical
database grew to over
34 billion premium and
loss records, providing
insurers with critical
data insight
Life insurers
experienced up to
75% reduction in
time to market with
our advanced
technology platform
Our personal
property database
grew to 124 million
personal property
data records
Building Resilience for a Changing World
We generated over 19.5
million property claim
estimates, providing
insurers and contractors
with accurate replacement
costs faster
We completed 34 million
medical risk assessments
for applicants of travel and
health insurance globally in
2023
> 90% of global reported
insured losses covered by
Verisk models
Submitted
approximately
2,000 regulatory
filings
Average annual loss from natural
catastrophes, captured in analysis using
Verisk’s extreme event solutions models
Of securitized risk transfer capital priced
using Verisk catastrophe risk models
Transforming Decisions and Fraud
Protection with Data
More than 1.7 billion
claims have been
contributed to our anti-
fraud database, which
enables the insurance
industry to efficiently
detect suspicious
activities
Our marketing solutions
dataset included over
50 million insurance
shopping events per
month
Our public records
database related to
driving risk grew to over
2 billion records
Experience the Possible / 7
Corporate Leadership 2023
Lee M. Shavel
President and Chief
Executive Officer
Doug Caccese
Co-President,
Underwriting Solutions
Kathlyn Card Beckles
Chief Legal Officer
Yang Chen
Head of Corporate
Development and
Strategy
Nick Daffan
Chief Information
Officer
Melissa Hendricks
Chief Marketing
Officer
Sunita Holzer
Chief Human Relations
Officer
Elizabeth Mann
Chief Financial
Officer
Maroun S. Mourad
President, Claims
Solutions
Rob Newbold
President, Extreme
Event Solutions
Saurabh Khemka
Co-President,
Underwriting Solutions
Tim Rayner
President, Specialty
Business Solutions
Board of Directors
Bruce Hansen Independent Chair
Wendy Lane
Kimberly S. Stevenson
Retired Chairman and Chief Executive Officer,
Experienced Board Director, Insurance and
Retired Executive, Technology and Global
ID Analytics
Executive Committee
Vincent Brooks
Global Information Services Industries
Information Services Industries
Finance and Investment Committee; Talent
Executive Committee; Governance, Corporate
Management and Compensation Committee
Sustainability and Nominating Committee; Risk
Committee (Chair); Talent Management and
Retired Four-Star General, U.S. Army
Samuel G. Liss
Compensation Committee
Governance, Corporate Sustainability, and
Principal, WhiteGate Partners LLC
Nominating Committee; Risk Committee; Talent
Audit Committee; Finance and Investment
Therese M. Vaughan
Management and Compensation Committee
Committee
Jeffrey Dailey
Lee M. Shavel
Retired Chief Executive Officer, National
Association of Insurance Commissioners
Audit Committee; Executive Committee;
Retired Chief Executive Officer, Farmers
Chief Executive Officer, Verisk Analytics
Governance, Corporate Sustainability, and
Group, Inc.
Nominating Committee (Chair)
Executive Committee; Finance and Investment
Olumide Soroye
Committee; Talent Management and Compen-
President and Chief Executive Officer,
sation Committee (Chair)
Intelligent Operating Solutions, Fortive
Corporation
Kathleen A. Hogenson
Audit Committee; Executive Committee;
President and Chief Executive Officer, Zone Oil
Finance and Investment Committee (Chair);
& Gas, LLC
Risk Committee
Audit Committee (Chair); Executive Committee;
Governance, Corporate Sustainability and
Nominating Committee; Risk Committee
8 / Verisk 2023 Annual Report
Selected Financial Data
Statement of operations*
Revenues:
Insurance revenues
Energy and Specialized Markets revenues
Financial Services revenues
Revenues
Total operating expenses
Operating income
Net income attributable to Verisk
Adjusted net income
Adjusted diluted earnings per share
Adjusted EBITDA:
Insurance
Energy and Specialized Markets
Financial Services
Total adjusted EBITDA
Adjusted EBITDA margin
Balance sheet data
Cash and cash equivalents
Total assets
Total debt
Verisk stockholders’ equity
Other data
Consolidated cash from operations
Consolidated capital expenditures
Years Ended December 31,
2023
2022
2021
(in millions, except for per share data)
$2,681.4
-
-
$2,681.4
$1,549.7
$1,131.7
$614.6
$841.4
$2,437.0
22.4
37.6
$2,497.0
$1,090.5
$1,406.5
$953.9
$795.7
$2,206.9
112.8
142.8
$2,462.5
$1,551.1
$911.4
$666.2
$730.9
$5.71
$5.01
$4.48
$1,433.5
-
-
$1,433.5
53.5%
$302.7
$4,366.1
$2,866.7
$322.2
$1,060.7
$(230.0)
$1,300.0
(21.9)
6.4
$1,284.5
51.4%
$112.5
$6,961.1
$3,736.1
$1,767.7
$1,059.0
$(274.7)
$1,215.3
9.6
22.9
$1,247.8
50.7%
$111.9
$7,808.1
$3,314.1
$2,842.5
$1,155.7
$(268.4)
EBITDA, Adjusted EBITDA, and Adjusted EBITDA Expenses: EBITDA represents GAAP net income adjusted for (i) depreciation and amortization
of fixed assets; (ii) amortization of intangible assets; (iii) interest expense; and (iv) provision for income taxes. Adjusted EBITDA represents
EBITDA adjusted for acquisition-related costs (earn-outs), gain/loss from dispositions (which includes businesses held for sale), and nonrecur-
ring gain/loss. Adjusted EBITDA expenses represent adjusted EBITDA net of revenues. We believe these measures are useful and meaningful
because they help us allocate resources, make business decisions, allow for greater transparency regarding our operating performance, and
facilitate period-to-pe riod comparison.
Adjusted Net Income and Diluted Adjusted EPS: Adjusted net income represents GAAP net income adjusted for (i) amortization of intangible
assets, net of tax; (ii) acquisition-related costs (earn-outs), net of tax; (iii) gain/loss from dispositions (which includes businesses held for sale),
net of tax; and (iv) nonrecurring gain/loss, net of tax. Diluted adjusted EPS rep resents adjusted net income divided by weighted-average diluted
shares. We believe these measures are useful and meaningful because they allow evaluation of the after-tax profitability of our results, excluding
the after-tax effect of acquisition-related costs and nonrecurring items.
EBITDA, adjusted EBITDA, and adjusted EBITDA expenses are non-GAAP financial measures. Margin is calculated as a percentage of revenues.
Prior periods have been recalculated to conform with the current definitions noted above.
We define “capital expenditures” as purchases of fixed assets and software development.
*Represents continuing operations view.
Financial Data / 9
Selected Financial Data
The following is a reconciliation of net income to adjusted net income:
Net income
Less: (Loss) Income from discontinued operations, net of tax
Income from continuing operations
Amortization of intangibles
Income tax effect on amortization of intangibles
Litigation reserve
Income tax effect on litigation reserve
Impairment of cost-based investments
Income tax effect on impairment of cost-based investments
Acquisition-related adjustments (earn-outs)
Income tax effect on acquisition-related adjustments (earn-outs)
Impairment loss
Income tax effect on impairment loss
Severance expense
Income tax effect on severance expense
Gain from dispositions
Income tax on effect on gain (loss) from disposition
Adjusted net income
The following is a reconciliation of net income to adjusted EBITDA:
Net income
Less: (Loss) Income from discontinued operations
Income from continuing operations
Depreciation and amortization
Amortization of intangible assets
Interest expense
Provision for income taxes
Impairment loss
Impairment of cost-based investments
Litigation reserve
Acquisition-related adjustments (earn-outs)
Severance expense
Gain from dispositions
Adjusted EBITDA
2023
2022
2021
(in millions)
$614.4
(154.0)
768.4
74.6
(18.7)
38.2
(0.5)
6.5
(0.4)
(19.4)
4.9
-
-
-
-
(15.9)
3.7
$841.4
$614.4
(154.0)
768.4
206.8
74.6
115.5
258.8
-
6.5
38.2
(19.4)
-
(15.9)
$1,433.5
$954.3
(87.8)
1,042.1
74.4
(18.6)
-
-
-
-
(0.1)
0.1
73.7
(16.8)
1.8
(0.4)
(427.9)
67.4
$795.7
$954.3
(87.8)
1,042.1
164.2
74.4
138.8
220.3
73.7
-
-
(2.9)
1.8
(427.9)
$1,284.5
$666.3
59.2
607.1
79.9
(20.0)
(50.0)
12.6
-
-
0.1
-
134.0
(32.8)
-
-
-
-
$730.9
$666.3
59.2
607.1
170.3
79.9
127.0
179.4
134.0
-
(50.0)
0.1
-
-
$1,247.8
Note regarding the use of non-GAAP financial measures
We have provided certain non-GAAP financial information as supplemental information regarding our operating results. Prior periods have been
recalculated to conform with the current definitions on page 7. These measures are not in accordance with, or an alternative for, U.S. GAAP and
may be different from non-GAAP measures reported by other companies. We believe that our presentation of non-GAAP measures, such as
EBITDA, adjusted EBITDA, adjusted EBITDA expenses, adjusted net income, diluted adjusted EPS, and organic constant currency, provides useful
information to management and investors regarding certain financial and business trends relating to our financial condition and results of opera-
tions. In addition, our management uses these measures for reviewing the financial results, for budgeting and planning purposes, and for evaluat-
ing the performance of senior management.
For definitions and descriptions of our non-GAAP measures, including organic constant currency (OCC), please refer to the notes section of our
quarterly press releases as filed on Form 8K with the SEC.
10 / Verisk 2023 Annual Report
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Í ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2023
or
‘ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the transition period from
to
Commission file number 001-34480
VERISK ANALYTICS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
545 Washington Boulevard
Jersey City
NJ
(Address of principal executive offices)
26-2994223
(I.R.S. Employer
Identification No.)
07310-1686
(Zip Code)
(201) 469-3000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol
Name of each exchange on which registered
Common Stock $.001 par value
VRSK
NASDAQ Global Select Market
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to
Í Yes ‘ No
such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to
Í Yes ‘ No
submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company
or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging
growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer Í
Non-accelerated filer ‘
Í Yes ‘ No
‘ Yes Í No
‘
Accelerated filer
Smaller reporting company ‘
Emerging growth company ‘
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with
any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ‘
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment on the effectiveness of its
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting
firm that prepared or issued its audit report. Í
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included
in the filing reflect the correction of an error previously issued financial statements. ‘
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ‘
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ‘ Yes Í No
As of June 30, 2023, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the
registrant’s common stock held by non-affiliates of the registrant was $31,913,567,495 based on the closing price reported on the NASDAQ
Global Select Market on such date.
As of February 16, 2024, there were 143,389,884 shares outstanding of the registrant’s Common Stock, par value $.001.
DOCUMENTS INCORPORATED BY REFERENCE
Certain information required by Part III of this annual report on Form 10-K is incorporated by reference to our definitive Proxy Statement for our
2023 Annual Meeting of Stockholders, which will be filed with the Securities and Exchange Commission not later than 120 days after
December 31, 2023.
INDEX
PART I
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1.
Item 1A. Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1B. Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 1C. Cybersecurity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 2.
Item 3.
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 4. Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases
of Equity Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 6.
[Reserved] . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations . . .
Item 7A. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 8.
Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Comprehensive Income
Consolidated Statements of Changes in Stockholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . .
Item 9A. Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 9B. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 9C Disclosure Regarding Foreign Jurisdictions that Prevent Inspections . . . . . . . . . . . . . . . . . . . .
PART III
Item 10. Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 11. Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 13. Certain Relationships and Related Transactions and Director Independence . . . . . . . . . . . . . .
Item 14. Principal Accounting Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART IV
Item 15. Exhibits and Financial Statement Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 16. Form 10-K Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXHIBIT INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Exhibit 21.1
Exhibit 23.1
Exhibit 31.1
Exhibit 31.2
Exhibit 32.1
Page
3
19
31
31
33
33
33
33
35
35
56
63
66
67
68
69
70
72
56
57
61
61
61
61
62
62
62
62
120
123
2
Unless the context otherwise indicates or requires, as used in this annual report on Form 10-K, references to
“we,” “us,” “our” or the “Company” refer to Verisk Analytics, Inc. and its subsidiaries.
In this annual report on Form 10-K, all dollar amounts are expressed in millions, unless indicated otherwise.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Verisk Analytics, Inc. (“Verisk”) has made statements under the captions “Business,” “Risk Factors,”
“Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and in other
sections of this annual report on Form 10-K that are forward-looking statements. In some cases, you can identify
these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,”
“anticipates,” “believes,” “estimates,” “predicts,” “potential,” or “continue,” the negative of these terms and
other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and
assumptions about us, may include projections of our future financial performance, our anticipated growth
strategies, and anticipated trends in our business. These statements are only predictions based on our current
expectations and projections about future events. There are important factors that could cause our actual results,
level of activity, performance, or achievements to differ materially from the results, level of activity,
performance, or achievements expressed or implied by the forward-looking statements, including those factors
discussed under the caption entitled “Risk Factors.” You should specifically consider the numerous risks outlined
under “Risk Factors.”
Although we believe the expectations reflected in the forward-looking statements are reasonable, we
cannot guarantee future results, level of activity, performance, or achievements. Moreover, neither we nor any
other person assumes responsibility for the accuracy and completeness of any of these forward-looking
statements. We are under no duty to update any of these forward-looking statements after the date of this annual
report on Form 10-K to conform our prior statements to actual results or revised expectations.
Item 1.
Business
Our Company
PART I
Verisk is a leading data, analytics, and technology provider serving clients in the insurance ecosystem.
We completed the sale of our Energy business on February 1, 2023. We also divested our specialized markets
and financial services businesses in March 2022 and April 2022, respectively.
Using advanced technologies to collect and analyze billions of records, we draw on unique data assets,
insurance industry knowledge, and technological expertise to provide valuable solutions that are integrated into
client workflows. We offer predictive analytics and decision support solutions to clients in rating, underwriting,
claims, catastrophe, weather risk, and many other fields. In the United States (“U.S.”) and around the world, we
help clients protect individuals, communities, and businesses.
Our clients use our solutions to make better decisions about risk and improve operating efficiency. We
refer to these products and services as solutions due to the integration among our services and the flexibility that
enables our clients to purchase components or a comprehensive package. These solutions take various forms,
including proprietary data assets, expert industry insight, statistical models, tailored analytic objects, and robust
software platforms all designed to allow our clients to make more informed risk decisions. We believe our
solutions for analyzing risk have a positive impact on our clients’ revenues and help them better manage their
costs. In 2023, our clients included all of the top 100 property and casualty (“P&C”) insurance providers in the
U.S. for the lines of P&C services we offer. We believe that our commitment to our clients and the embedded
nature of our solutions serve to strengthen and extend our relationships.
3
We believe that Verisk is uniquely positioned with a series of competitive advantages including:
• Proprietary Data Assets — Data is at the core of what we do. We use our proprietary and contributory
data assets to develop predictive analytics and transformative models for our clients;
• Deep Insurance Industry Expertise and Focus — We have specialized and in-depth knowledge in
insurance and risk management that drives our engagement with our clients;
•
•
Long-standing Industry Relationships — Our early beginnings as an insurance rating bureau
have established us as a trusted partner for the industry as well as a source of insights for our clients;
and
Scale to Drive Broad Distribution of Innovation — Our scale advantage enables us to innovate on
behalf of the insurance industry and deliver solutions that strive to solve our clients’ biggest challenges.
Our Business Strategy
Our vision is to be the leading strategic data, analytics, and technology partner to the global insurance
industry by delivering value to our clients through knowledge, expertise, and scale. Our business aims to build
upon our competitive advantages and capitalizing on our scale and position within the industry. Our business
strategy is driven by the following priorities:
• Drive Consistent & Predictable Growth. With our clear focus on insurance, integrated organization
and our client-centric and results-oriented culture, we strive to deliver consistent and predictable
growth. We are leveraging our strong client relationships to extend our reach within insurance. We are
modernizing and advancing the capabilities of our core solutions using cloud technology and advanced
analytical methods including machine learning and artificial intelligence (“AI”) while also augmenting
our solutions through the addition of new data assets and sources. In addition, we are working
on building leadership positions in adjacent markets including life insurance, marketing, specialty
business solutions, and resilience and sustainability. With the client at the center of all we do, we are
driving innovation across our portfolio and partnering with our clients to help solve the insurance
industries greatest challenges with a focus on rapidly changing technology, growing regulatory focus,
and value creation;
• Drive Operating Efficiency and Profitability. Our subscription business model as well as our ability
to build solutions that serve the insurance industry at large helps drive core operating leverage. In
addition, we strive to deliver productivity enhancements and operating efficiency through the use of
advanced technology and a global talent workforce. We seek to balance this with high return on capital
investment into the business to continue to drive growth and profitability; and
• Ensure Disciplined Capital Allocation. We are focused on generating strong cash flow and ensuring
that we are disciplined in how we allocate that capital with a focus on directing capital to the highest
return investments. First, we prioritize organic reinvestment in the business, which can produce high
internal returns. Second, we look for selective, strategic acquisitions that can expand our data assets,
augment our capabilities, and expand our reach within the insurance industry while also creating value
by leveraging our capabilities and resources. Finally, we expect to return excess capital to shareholders
while also maintaining a strong balance sheet.
Our History
We trace our history to 1971, when Insurance Services Office, Inc. (“ISO”) started operations as a
not-for-profit advisory and rating organization providing services to the U.S. P&C insurance industry. ISO was
formed as an association of insurance companies to gather statistical data and other information from insurers
and report to regulators, as required by law. ISO’s original functions also included developing programs to help
insurers define and manage insurance solutions and providing information to help insurers determine their own
independent premium rates. Insurers used and continue to use our offerings primarily in their product
development, underwriting, and rating functions.
4
On May 23, 2008, in contemplation of our initial public offering (“IPO”), ISO formed Verisk Analytics,
Inc. (“Verisk”), a Delaware corporation, to be the holding company for our business. Verisk was initially formed
as a wholly owned subsidiary of ISO. On October 6, 2009, in connection with our IPO, we effected a
reorganization whereby ISO became a wholly owned subsidiary of Verisk. Verisk common stock began trading
on the NASDAQ Global Select Market on October 7, 2009, under the ticker symbol “VRSK.”
Segments
Our operating segments have historically been Insurance, Energy and Specialized Markets, and Financial
Services. On March 11, 2022 and April 8, 2022, we sold 3E Company Environmental, Ecological and
Engineering (“3E”), our environmental health and safety business, which represented the “specialized markets”
in our Energy and Specialized Markets segment, and our Financial Services segment, respectively. We assessed
the sale of 3E and Financial Services segment per the guidance in ASC 205-20, Discontinued Operations (“ASC
205-20”), and determined that the transactions did not qualify as a discontinued operation because they did not,
quantitatively or qualitatively, represent a strategic shift that has or will have a major effect on our operations and
financial results. On October 28, 2022, we also entered into an equity purchase agreement to sell Wood
Mackenzie, Inc. and Verisk New UK Holdco LP (together with their respective subsidiaries, our “Energy
business”). The transaction closed on February 1, 2023. The Energy business qualified as held for sale in the
fourth quarter of 2022 and was classified as a discontinued operation per the guidance in ASC 205-20, as we
determined that this transaction represents a strategic shift that has or will have a major effect on our operations
and financial results. Accordingly, all results of the Energy business have been removed from continuing
operations and presented as discontinued operations in our consolidated statements of operations and assets and
liabilities held for sale for all periods presented. Results of our Energy business are reported as a discontinued
operation for the year ended December 31, 2022 and for all prior periods presented. See Note 11. Dispositions
and Discontinued Operation for further discussion.
Insurance Segment
We now operate in one segment, Insurance, which primarily serves our P&C insurance customers across
most personal and commercial lines of business, focusing on the fundamental building blocks of insurance
programs, the prediction of loss, the selection and pricing of risk, and compliance with their reporting
requirements in each U.S. state in which they operate. We also develop and utilize machine-learned and
artificially intelligent models to forecast scenarios and produce both standard and customized analytics that help
our customers better manage their businesses, including detecting fraud before and after a loss event and
quantifying losses. Our customers, acquired over more than 50 years, include most of the P&C insurance
providers in the U.S. In recent years, we have expanded our offerings to serve certain non-U.S. markets and into
the fields of life insurance and annuities, as well as insurance marketing. We offer our solutions and services
primarily through annual subscriptions or long-term agreements, which are typically prepaid and represented
approximately 80% of our revenues in 2023. We believe we are well positioned to increase our penetration of the
global insurance industry because of our proprietary data assets, long-standing industry relationships, deep
insurance industry expertise, and our scale to drive broad distribution of our new innovations.
Underwriting
Powered by proprietary and contributory data and advanced analytics and technologies, we offer a full
suite of solutions to support our P&C clients across the insurance policy lifecycle. This support spans their
product development, marketing, new and renewal underwriting, risk selection and segmentation, pricing, and
straight through to policy binding and issuance. We continued to grow our presence internationally and expand
our capabilities into new markets, such as life insurance and annuities, and into new workflows, such
as marketing and customer acquisition.
5
Forms, Rules, and Loss Costs
We are the recognized leader in the U.S. for industry-standard insurance programs that help P&C insurers
define coverages and issue policies. We provide policy language, prospective loss costs, policy writing and rating
rules, and a variety of underwriting solutions for risk selection and segmentation, pricing, and workflow
optimization across 31 lines of insurance. Our policy language, prospective loss cost information, and policy
writing rules can serve as integrated, turnkey insurance programs for our clients.
Insurance companies need to ensure that their policy language, rules, and rates comply with all applicable
legal and regulatory requirements. They must also make sure their policies remain competitive by promptly
changing coverages in response to changes in statutes, case law, or regulatory requirements. To meet our clients’
needs, we process approximately 2,000 regulatory filings and interface with state regulators in all 50 states plus
the District of Columbia, Guam, Puerto Rico, and the Virgin Islands each year to ensure smooth implementation
of our rules and forms. When insurers choose to develop their own alternative programs, our industry-standard
insurance programs also help regulators ensure that such insurers’ policies meet basic coverage requirements.
Standardized coverage language, which has been tested in litigation and tailored to reflect judicial
interpretation, helps ensure consistent treatment of claimants. As a result, our industry-standard language also
simplifies claim settlements and can reduce the occurrence of costly litigation because our language causes the
meaning of coverage terminology to become established and known. Our policy language includes standard
coverage language, endorsements, and policy writing support language that assist our clients in understanding the
risks they assume and the coverages they offer. With these policy programs, insurers also benefit from economies
of scale. We have more than 240 insurance experts and specialized lawyers reviewing changes in each state’s
insurance rules and regulations, including an average of approximately 14,800 legislative actions, 12,500
regulatory actions, and 2,000 court decisions per year, to make any required changes to our policy language and
rating information.
To cover the wide variety of risks in the marketplace, we offer a broad range of policy programs. For
example, in the homeowners line of insurance, we maintain policy language and rules for approximately
seven basic coverages, 385 national endorsements, and 685 state-specific endorsements.
The P&C insurance industry is heavily regulated in the U.S.; P&C insurers are required to collect
statistical data about their premiums and losses and to report that data to regulators in every state in which they
operate. Our statistical agent services have enabled P&C insurers to meet those regulatory requirements for more
than 50 years.
We aggregate the data, and as a licensed or appointed “statistical agent” in all 50 states, Puerto Rico, and
the District of Columbia, we report those statistics to insurance regulators. We are able to capture significant
economies of scale given the level of penetration of this service within the U.S. P&C insurance industry.
To provide our clients and the regulators with the information they require, we maintain one of the largest
private databases in the world. Over the past five decades, we have developed core expertise in acquiring,
processing, managing, protecting, and operating large and comprehensive databases that are the foundation of our
insurance offerings. We use our proprietary technology to assemble, organize, and update vast amounts of
detailed information submitted by our clients. We supplement this data with publicly available information.
In 2023, P&C insurers sent us approximately 2.8 billion detailed individual records of insurance
transactions, such as insurance premiums collected or losses incurred. We maintain an underwriting database of
more than 34.5 billion statistical records, including approximately 9.2 billion commercial lines records and
approximately 25 billion personal lines records. We collect unit transaction detail of each premium and loss
record, which enhances the validity, reliability, and accuracy of our data sets and our actuarial analyses. Across
all of our insurance lines, our proprietary quality process includes more than 2,900 separate checks to ensure that
the data meets our high standards.
6
Using our large database of premium and loss data, we provide actuarial services to help our clients
analyze and price their risks. Our actuaries are able to perform sophisticated analyses using our predictive models
and analytic methods to help our P&C insurance clients with pricing, loss reserving, and market analysis. We
distribute a number of actuarial solutions and offer flexible services to meet our clients’ needs. In addition, our
actuarial consultants provide customized services for our clients that include assisting them with the development
of independent insurance programs, analysis of their own underwriting experience, development of classification
systems and rating plans, and a wide variety of other business decisions. We also supply information to various
clients in other markets, including reinsurance and government agencies.
We project clients’ future losses and loss expenses using a broad set of data. Those projections tend to be
more reliable than if our clients used their own data exclusively. We make a number of actuarial adjustments
before the data is used to estimate future costs. Our clients can use our estimates of future costs in making
independent decisions about the prices charged for their policies. For most P&C insurers in most lines of
business, we believe that our estimates of future costs are an essential input to rating decisions. Our actuarial
solutions and services are also used to create the analytics underlying our industry-standard insurance programs
described above.
In response to the challenges faced by our clients to reduce operating complexity and improve their speed
to market, we are undertaking an extensive modernization of our core lines product. This “reimagine” of our
forms, rules, loss costs and related solutions is designed to deliver increased value to our customers. The
Reimagine program will include significant enhancements to our existing solutions; new digital workflow tools,
insights, and analytics; and an enhanced content delivery platform.
Underwriting Data and Analytics Solutions
We gather information on individual properties, vehicles and communities providing the breadth and
depth of data and analytics needed to support our clients as they evaluate, segment, and price personal and
commercial insurance, as well as commercial liability insurance, throughout the policy lifecycle. Our property-
and auto- specific rating and underwriting information allows our clients to understand, quantify, underwrite,
mitigate, and avoid potential loss for these risks.
Our database contains data and analytics on approximately 15.9 million commercial properties in the U.S.
We have a staff of approximately 500 field representatives strategically located around the U.S. who observe and
report on conditions at commercial and residential properties, evaluate community fire-protection capabilities,
and assess the effectiveness of municipal building-code enforcement. Each year, our field staff visits more than
300,000 commercial properties to collect information on new buildings, verify building attributes, and provide
specific loss costs. Our auto solutions are powered by a mix of third-party and proprietary data ranging from
2 billion traffic court records to 500 billion miles of connected car telematics data and we have characteristics on
more than 270 million insured drivers and 280 million registered vehicles with access to expansive industry
databases on loss costs and claims.
We are a leading provider of innovative solutions for the personal underwriting markets, including
homeowners and auto lines. Drawing on an array of resources from proprietary and third-party data to geospatial
imagery, we build and maintain widely used industry-standard tools that assist insurers in underwriting and rating
— that is, measuring and selecting risks and pricing coverage appropriately to help ensure fairness to the
consumer and a reasonable return for the insurer. Our solutions apply advanced predictive analytics to our deep
reservoir of data and information to gauge the degree and cost of risk quickly and precisely, and our workflow
tools help insurers increase speed and cost-efficiency while enhancing customer experiences. These solutions
span a range of applications — from using precise home reconstruction costs to help policyholders have the right
amount of coverage, to providing auto insurers with the data that supports offering consumers a bindable quote in
minutes through modern API’s.
7
We also provide proprietary analytic measures of the ability of individual communities to mitigate losses
from important perils. Nearly every property insurer in the U.S. uses our evaluations of community firefighting
capabilities to help determine premiums for fire insurance throughout the country. We provide field-verified and
validated data on fire protection services for approximately 36,000 fire response jurisdictions. We also offer
services to evaluate the effectiveness of community enforcement of building codes and the efforts of
communities to mitigate damage from flooding.
Further, we provide information on the insurance rating territories, premium taxes, crime risk, and
hazards of windstorm, earthquake, wildfire, and other perils. To supplement our data on specific commercial
properties and individual communities, we have assembled, from a variety of internal and third-party sources,
information on hazards related to geographic locations representing every postal address in the U.S. Insurers use
this information not only for policy quoting but also for analyzing risk concentration in geographical areas. We
also make our data and analytics available to commercial real estate lenders to allow them to better understand
risks associated with people to whom they lend.
Extreme Event Solutions
We are a leader in and pioneered the field of probabilistic catastrophe modeling used by insurers,
reinsurers, intermediaries, financial institutions, and governments to manage their risk from extreme events. Our
models, which form the basis of our solutions, enable companies to identify, quantify, and plan for the financial
consequences of catastrophes. We have developed models for hurricanes, earthquakes, winter storms, tornadoes,
hailstorms, wildfires, and floods in more than 120 countries, as well as for pandemics worldwide. We have
developed a probabilistic terrorism model capable of quantifying the risk in the U.S. from this evolving threat,
which supports pricing and underwriting decisions down to the level of an individual policy, as well as models
for estimating losses to crop insurance programs in the U.S., Canada, India, and China. Our newest models offer
risk quantification solutions for the casualty line of business.
We also help businesses and governments better anticipate and monitor risks in Earth’s natural
environment. We prepare certain agencies and companies to anticipate, manage, react to, and profit from climate-
and weather-related risk. We serve our customers by providing advanced research, development, and analysis
delivered in reports, data streams, and software solutions. We are dedicated to the advancement of the
atmospheric and remote sensing science disciplines and directly addressing problems regarding weather, climate,
and air quality as well as oceanography and the planetary sciences. Through research conducted by our in-house
scientific staff, and often in collaboration with prominent scientists at academic and other research institutions,
we have developed analytical tools to help measure and observe environmental properties and translate those
measurements into actionable information.
Finally, we offer global risk intelligence providing insight into sustainability, resilience, and
environmental, social, and governance (ESG) issues, underpinned by geospatial data and analytics. We provide
intelligence on sustainability, resilience, human rights, sovereign and political risk, and ESG — stitching together
these disparate issues into an interconnected global view built upon objective insight and data.
Life Insurance Solutions
In recent years we have expanded our offerings to also serve the life insurance and annuities markets
through our 2019 acquisition of FAST. Life Insurance Solutions enable new approaches across the policy life
cycle through no-code technology, data analytics, and modeling. We have developed a suite of solutions that
apply advanced analytics, automation, and machine learning to existing and emerging data sources. Our solutions
are designed to help transform current workflows in life insurance underwriting, claim insights, policy
administration, unclaimed property/equity, compliance and fraud detection, and actuarial and portfolio modeling.
Our industry-leading FAST platform can reduce time to market, enables faster policy conversion, and can
reduce information technology costs for our customers, uniquely positioning us to help support the
modernization of the life insurance industry.
8
Specialty Business Solutions
We are a leading software supplier to the global specialty insurance market with particular focus on the
London specialty market where we have a long-standing client base. Our powerful software suite, coupled with
our vast datasets, experience, and technology allows our clients to grow and better manage their business with
greater efficiency, flexibility, and data governance. Our solutions serve insurers, (re)insurers, brokers, cover
holders, and managing general agents (MGAs) in London and across the globe.
We help drive the success of many of the fastest growing insurance and reinsurance specialists by
providing full end-to-end management of insurance and reinsurance business. Our suite of software solutions
covers a broad range of insurance processes from policy negotiation and placement, pricing and policy
administration through to claims and outwards reinsurance.
Many of our solutions can be integrated with one another and with capabilities across the organization to
meet evolving client needs and offer a compelling digital ecosystem for the London and global insurance market.
To that end, our global marketplace solution offers seamless real-time quote-to-bind electronic placing and
distribution for the specialty insurance market.
Marketing Solutions
Through recent acquisitions, we extended our data and workflow capabilities to help the global insurance
industry drive improvement in customer acquisition, growth, and retention. Marketing and advertising spend for
insurers goes well beyond $10 billion and has continued to increase year over year. We possess unique and
proven data sets that help the insurance industry more precisely segment, target, and optimize advertising and
marketing spend. Solutions include compliant, real-time decisioning, profitability, and risk assessment (pre-quote
and pre-underwriting) for inbound consumer interactions. We also power ongoing enrichment of prospective and
current customer insights for the highest probability of retention and increased share of wallet (policy bundling)
as well as full coverage of US households and consumers to drive prospect marketing and advertising strategies.
Verisk Marketing Solutions brings a unique insurance-focused, specialized offering that covers insurance
carriers’ holistic marketing data needs.
International Underwriting Solutions
We continue to expand our footprint of data and solutions to include international markets. Our
international insurance markets grew through acquisitions and today serve a large number of insurers operating
in the Canadian, United Kingdom (U.K.) and Irish property and casualty markets, and travel market.
Additionally, our international market provides services to much of the Lloyd’s of London market, while also
serving clients in Continental Europe, Singapore, China, Australia, and New Zealand. The international enhanced
commercial and residential property models and enriched data sets help insurers with triage, reconstruction value,
risk selection, pricing, benchmarking, and portfolio management across multiple insured segments. Insurers also
use our solutions to help fine-tune the accuracy of their rating models and to enhance underwriting results
through a set of analytical solutions that predict the relative risk and variation of major insurance perils, including
theft, flood, storm, fire, freeze, etc. In addition to property data and solutions, clients can benefit from decision
and benchmarking analytics using firmographic, technographic, and business intelligence and proprietary
management competency scores, delivered digitally to enable straight through processing. Our suite of
international solutions also includes rating tools that automate the assessment of pre-existing conditions, helping
travel and health insurers to get a broad view of a customer’s medical risk and make underwriting decisions with
speed and precision.
Claims
Our claims insurance solutions provide our customers analytics in fraud detection, compliance reporting,
subrogation liability assessment, litigation, and repair cost estimation and valuation, including emerging areas of
interest within these categories.
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Property Estimating Solutions
We also provide data, analytics, and networking solutions for professionals involved in estimating all
phases of building repair and reconstruction. We provide solutions for every phase of a building’s life, including:
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quantifying the ultimate cost of repair or reconstruction of damaged or destroyed buildings for personal
and commercial properties;
aiding in the settlement of insurance claims; and
tracking the process of repair or reconstruction and facilitating communication among insurers,
adjusters, contractors, and policyholders.
To help our customers estimate repair costs, we provide a solution that assists contractors and insurance
adjusters in estimating repairs using a patented plan-sketching program that automatically calculates material and
labor quantities for all desired construction or repairs to a structure based on user inputs.
We also provide our customers access to price lists, which include structural repair and restoration pricing
for 468 separate economic areas in North America based on direct market surveys and analysis of actual
customer claim experience. We revise this information monthly, and as often as weekly in the aftermath of major
disasters, to reflect rapid price changes. Our structural repair and cleaning database contains approximately
21,000 unit-cost line items. We estimate that more than 80% of insurance repair contractors and service providers
in the U.S. and Canada with computerized estimating systems use our building and repair pricing data. This large
percentage leads to accurate reporting of pricing information, which we believe is unmatched in the industry.
Our virtual claims-adjusting tools help improve policyholder satisfaction, reduce human error, and save
on loss adjustment expense. These tools simplify collaboration among claims professionals, contractors, and
policyholders as they work together remotely and efficiently. These cloud-based and on-premise solutions
include real-time video collaboration, remote measuring tools, generative AI-powered damage assessment, and
image analytics fraud warnings, among other features.
Customers access our ecosystem for enhanced claims handling and analysis. For example, they can use
our weather API for near-real-time updates and valuable insights for responding to weather perils that can impact
their policyholders and their business. They can also use our data insights to analyze and benchmark their
performance against peers in the industry and to manage claims assignments.
Anti-Fraud Solutions
We are a leading provider of fraud-detection tools for the P&C insurance industry. Our anti-fraud
solutions can improve our customers’ profitability by predicting the likelihood that fraud may be occurring and
by detecting suspicious activity after it has occurred.
Our claims database lends significant support to the fight against insurance fraud. The database contains
information from more than 1.7 billion claim records and is the world’s largest database of P&C claims
information used for claims processing and fraud investigations. Insurers and other participants submit more than
184,000 new claims a day on average across all U.S. P&C insurance industry categories. The benefits of an
industrywide claims database include improved efficiency in reporting data and searching for information,
enhanced capabilities for detecting suspicious claims, and superior information for investigating fraudulent
claims, suspicious individuals, and possible fraud rings. Our database also helps insurers fulfill their regulatory
compliance reporting requirements at both the state and federal levels for delinquent child-support liens and other
required checks.
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When a claim is submitted, our system searches our claims database and returns information about other
claims filed by the same individuals or businesses (either as claimants or insureds) that helps our customers
determine if fraud may be occurring. The system searches for matches in identifying information fields, such as
name, address, Social Security number, vehicle identification number, driver’s license number, tax identification
number, or other parties to the loss. Our system also includes advanced name and address searching to perform
intelligent searches and improve the overall quality of the matches.
Information from match reports speeds payment of meritorious claims while providing a defense against
fraud and can lead to denial of a claim, negotiation of a reduced award, or further investigation by the insurer or
law enforcement. We also have a suite of advanced fraud analytics solutions: a solution that uses predictive
models to accurately score claims based on fraud indicators; an injury claims solution that uses predictive
analytics to detect medical provider fraud, waste, and abuse; and a network analytics solution that helps detect
patterns indicative of organized fraud. A claims adjuster or investigation professional can use our comprehensive
case management system to manage claim investigations.
We continually pursue new solutions that help our customers keep abreast of changing markets and
technology. For example, we developed a digital media database that allows customers to view prior-loss images
on claim matches so they can detect pre-existing damage on new claims. Our advanced digital media forensics
can detect suspicious claim-related photos, and our customers can flag stolen and synthetic identities in the
database to help subscribers deter that type of fraud. We also provide accurate person and vehicle coverage
details at first notice of loss (FNOL), including verified registered owner information through DMV data, contact
information for the individual, and brief claims history.
Casualty Solutions
We offer a full suite of casualty/bodily injury solutions to serve the P&C industry, third-party
administrators, and self-insured employers. Verisk casualty solutions focus on compliance (Medicare Secondary
Payer and workers’ compensation state reporting); casualty claims decision support (severity detection and
damage assessment); and workflow automation (automated medical record review and claims processing). Our
compliance division offers Medicare Secondary Payer solutions and services to comply with the federal statute,
including Section 111 Centers for Medicare & Medicaid Services (CMS) reporting, lien resolution/conditional
payments, liabilities repayment, and ongoing protection of the Medicare Trust Fund via Medicare Set Aside
(MSA) services. As the largest provider of Medicare compliance services in the industry, we play a critical role
in assisting and protecting all stakeholders, including Medicare and its beneficiaries.
Our comprehensive workers’ compensation state reporting helps customers meet the very complex
compliance requirements for reporting to states and other government related agencies and entities through an
automated process driving efficiency and productivity for the U.S. P&C insurance industry.
Our casualty claims decision support and workflow automation offerings augment human capital in a
claims organization to make accurate decisions while eliminating manual steps in the process. We have solutions
that leverage AI and generative AI to automatically extract unstructured data from and summarize medical
records for efficient review and analysis during claim processing and demand packages review to improve injury
evaluations and settlement negotiations. We also offer tools that use predictive analytics to provide workers’
compensation severity scoring from first notice of loss through claim closure to help our customers accurately
settle claims. For liability, our customers can use our solution to find comparative liability in personal auto,
commercial auto, and general liability claims for injury evaluation, determining accident liability and identifying
subrogation opportunities.
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International Claims Solutions
We continue to expand our claim product offerings to international markets through internal innovations
and acquisitions in both the United Kingdom and Continental Europe. Our solutions are centered around personal
injury and motor franchises covering Germany, the Nordics, and the United Kingdom with complementary
offerings to the property claims sector in the United Kingdom. Our solutions aim to enable greater certainty,
lower indemnity, more automation, and quicker speed to settlement for our personal lines insurance customers.
Where appropriate, we look to leverage our growing data assets to introduce claim analytics and anti-fraud
solutions in these markets.
Energy and Specialized Markets Segment
Up until the sale of our Energy business on February 1, 2023, we were a leading provider of data
analytics across the natural resources value chain including the global energy, chemicals, metals and mining, and
power and renewables sectors. We delivered analysis and advice on assets, companies, governments, and markets
based on proprietary near real time data as well as historic information. This enabled us to offer a comprehensive
and integrated analysis of relevant commodities to our customers. We provided research and consulting services
focusing on supporting customer capital allocation decisions, asset valuation and benchmarking, commodity
markets, and corporate analysis. We offered consultancy in the areas of business environment, business
improvement, business strategies, commercial advisory, and transaction support.
Before the sale of our specialized markets on March 11, 2022, we offered a comprehensive suite of data
and information services that enable improved compliance with global environmental health and safety
(“EH&S”) requirements related to the safe manufacturing, distribution, transportation, usage, and disposal of
chemicals and products. From the supply chain or solutions life cycle, we delivered a program specific to the
EH&S compliance information and management needs of our customers. Our full-solutions life cycle and
cross-supply chain approach provided a single, integrated solution for managing customers’ EH&S capabilities,
which resulted in improved processes and reduced cost, risk, and liability.
Financial Services
Before the sale of Financials Services Segment on April 8, 2022, we maintained the largest bank account
consortia to provide competitive benchmarking, decisioning algorithms, business intelligence, and customized
analytic services to financial institutions, payment networks and processors, alternative lenders, regulators, and
merchants enabling better strategy, marketing, and risk decisions. We delivered unique solutions and services to
an expanding customer base that valued the comprehensiveness of our data and solutions as well as our full
wallet-spend view of a consumer. Complementing this, we leveraged our partnerships with processors and credit
bureaus not only to augment the richness of our data but also to provide expanded solutions across the broad span
of consumer banking and retail solutions.
Our Customers
The customers in our Insurance segment for the lines of P&C services we offer include the top 100 P&C
insurance providers in the U.S., 18 of the top 25 global reinsurance companies, as well as domestic InsurTech
companies and insurers in international markets. A substantial majority of P&C insurance providers in the U.S.
use our statistical agent services to report to regulators, and the majority of insurers and reinsurers in the U.S. use
our actuarial services and industry-standard insurance programs. In addition, certain agencies of the federal
government as well as county and state governmental agencies and organizations use our solutions to help satisfy
government needs for risk assessment and emergency response information. Within Extreme Events, we serve
reinsurers, insurers, brokers, governments, and corporates helping them identify, quantify and plan for the
financial consequences of catastrophes. For life and annuity insurers, we offer digital solutions including
electronic applications and policy administration systems to enable automated/accelerated triage, underwriting,
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fraud detection, and modeling. Our claims database serves thousands of customers, representing approximately
90% of the P&C insurance industry by premium volume, approximately 500 self-insurers, approximately
400 third party administrators, several state fraud bureaus, and many law enforcement agencies involved in the
investigation and prosecution of insurance fraud. We estimate that more than 80% of insurance repair contractors
and service providers in the U.S. and Canada with computerized estimating systems use our building and repair
cost estimation pricing data.
Our Competitors
The breadth of markets we serve exposes us to a broad range of competitors as described below.
Businesses that we acquire may introduce us to additional competitors.
Our Insurance segment operates primarily in the U.S. P&C insurance industry. We have a number of
competitors in specific lines or services. We encounter competition from a number of sources, including insurers
that develop internal technology and actuarial methods for proprietary insurance programs. Competitors also
include other statistical agents and other advisory organizations, that provide underwriting rules, prospective loss
costs, and coverage language. Competitors for our property-specific rating and underwriting information are
primarily regional providers of commercial property inspections and surveys as well as emerging providers in the
InsurTech space. We also compete with a variety of organizations that offer consulting services, primarily
specialty technology and consulting firms. In addition, a customer may use its own internal resources rather than
engage an outside firm for these services. Our underwriting solutions compete with a variety of companies in the
marketplace. Our competitors include information technology product and services vendors; management and
strategy consulting firms; and smaller specialized information technology and analytical services firms. Finally,
in the life insurance sector, our solutions compete against numerous independent vendors, as well as the in-house
technology departments of Life Insurers. In the P&C insurance claims and catastrophe modeling markets, certain
products are offered by a number of companies in the areas of catastrophe modeling, repair cost estimating,
claims investigative reports, claims fraud analytics, and injury claims analytics. We believe that our P&C
insurance industry expertise, and our ability to offer multiple applications, services, and integrated solutions to
individual customers are competitive strengths.
Development of New Solutions
We take a market-focused team approach to developing our solutions. Our operating units are responsible
for developing, reviewing, and enhancing our various solutions and services. Our data management and
production team designs and manages our processes and systems for market data procurement, proprietary data
production, and quality control. Our teams support our efforts to create new information and solutions from
available data and explore new methods of collecting data. We are focused on understanding and documenting
business unit and corporate data assets and data issues, sharing and combining data assets across the enterprise,
creating an enterprise data strategy, facilitating research and product development, and promoting cross-
enterprise communication.
Our software development teams build the technology used in many of our solutions. As part of our
product development process, we continually solicit feedback from our customers on the value of our
solutions and services and the market’s needs. We have established an extensive system of customer advisory
panels that meet regularly throughout the year to help us respond effectively to the needs of our markets. In
addition, we use frequent sales calls, executive visits, user group meetings, and other industry forums to gather
information to align our product development efforts with the needs of the market. We also use a variety of
market research techniques to enhance our understanding of our customers and the markets in which they
operate.
We add to our offerings through an active acquisition program. Since 2021, we have acquired
13 businesses, which have allowed us to enter new markets, offer new solutions, and enhance the value of
existing services with additional proprietary sources of data.
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When we find it advantageous, we augment our proprietary data sources and systems by forming
alliances with other leading information providers and technology companies and integrating their product
offerings into our offerings. This approach gives our customers the opportunity to obtain the information they
need from a single source and more easily integrate the information into their workflows.
Sales, Marketing, and Customer Support
We sell our solutions and services primarily through direct interaction with our customers. We employ a
three-tier sales structure that includes salespeople, technical consultants, and sales support. Within our Company,
several areas have sales teams that specialize in specific solutions and services. Those specialized sales teams sell
specific, highly technical solution sets to targeted markets in coordination with account management.
To provide account management to our largest customers, we divide our customers into three groups. Tier
One (“Client Engagement Accounts”) comprises our largest customers. Tier Two (“Strategic Accounts”)
represents both large and middle-market customer groups. Tier Three is composed of small and specialized
companies that may represent one line of business, may be regionally focused, or are recent new entrants into the
marketplace. In Tier One and Tier Two segments, we have sales teams organized by the following specialties:
personal or commercial lines underwriting and pricing, claims, and catastrophe risk. In the Tier Three segment,
we assign a sales generalist with overall account management responsibility. Our tiered approach has proven to
be a successful sales model and approach to building customer relationships. Our senior executives regularly
engage with the senior management of our customers to ensure customer satisfaction and strategic alignment and
to support mutual partnership innovation opportunities.
Salespeople participate in both sales and customer service activities. They provide direct support,
interacting frequently with assigned customers to ensure a satisfactory experience using our services. Salespeople
primarily seek out new sales opportunities and work with the various product teams to coordinate sales activities
and ensure our solutions fit the customer’s needs. We believe our salespeople’s product knowledge, skills to
develop relationships of trust, and local presence differentiate us from our competition. Subject matter experts
work with salespeople on specific opportunities for their assigned solutions and segments. Salespeople manage
the overall sales process and subject matter experts manage the rigorous integration and functional fit discussions
to ensure mutual success and satisfaction. Both salespeople and technical consultants have responsibility for
identifying new sales opportunities as well as handling renewals of existing business. A team approach and a
common customer relationship management system allow for effective coordination among the groups.
Sources of Our Data
The data we use to perform our analytics and power our solutions is sourced through seven different kinds
of data arrangements. First, we gather data from our customers within agreements that also permit our customers
to use the solutions created from their data. Those agreements remain in effect unless the data contributor
chooses to opt out. It is very rare that contributors elect not to continue providing us data. Second, we have
agreements with data contributors in which we specify the particular uses of their data and provide their required
levels of privacy, protection of data, and where necessary, de-identification of data. The agreements represent no
cost to us, generally feature a specified period of time for the data contributions, and require renewal. Third, we
“mine” data found inside the transactions supported by our solutions; as an example, we use the claims
settlement data generated inside our repair cost estimating solution to improve the cost factors used in our
models. Again, those arrangements represent no cost to us, and we obtain the consent of our customers to make
use of their data in this way. Fourth, we source data generally at no cost from public sources, including federal,
state, and local governments. Fifth, we gather data about the physical characteristics of commercial properties
through the direct observation of our field staff members, who also perform property surveys at the request of,
and facilitated by, property insurers. Sixth, we collect data, or license or purchase from third parties, on
geographic and spatially referenced information relating to residential and commercial structures by using the
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latest remote sensing and machine learning technologies. Lastly, we purchase data from data aggregators under
contracts that reflect prevailing market pricing for the data elements purchased, including county tax assessor
records, descriptions of hazards such as flood plains, and professional licenses. We are the owners of the
derivative solutions we create using the data we collect.
Information Technology
Technology
Our information technology systems and the more recent adoption of cloud computing are fundamental to
our success. They are used for the storage, processing, access, and delivery of the data that forms the foundation
of our business and the development and delivery of the solutions we provide to our customers. We generally
own, or have secured ongoing rights to use for the purposes of our business, all the customer-facing applications
that are material to our operations. We support and implement a mix of technologies and focus on implementing
the most efficient technology for any given business requirement or task.
Data Centers
In 2023, with our migration to cloud computing, we closed our Lehi, Utah Data Center. We have plans to
close our Somerset, New Jersey facility in the first half of 2024. We will continue to maintain other datacenters
dedicated to other businesses we acquired recently.
Disaster Recovery
We are committed to a framework for business continuity management and carry out annual reviews of
the state of preparedness of each business unit. As we migrate our application to public cloud, we also evaluate
the level of redundancy required for each application. We leverage native cloud capabilities with regards to
availability and use both zones and regions in public cloud based on availability requirements. Business
continuity planning is in place for all of our critical business processes to provide for the prompt and effective
continuation of critical services in the event of a business disruption. Our business continuity program adheres to
ISO 22301:2019, which is an international standard for business continuity. All business impact analysis and
business continuity plans are reviewed and updated, at a minimum, annually or when significant business
changes occur.
Security
We have adopted a wide range of measures to secure our IT infrastructure and data. Security measures
generally cover the following key areas: security policies and governance committees, physical security, logical
security of the perimeter, network security such as firewalls, logical access to applications and operating systems,
deployment of endpoint anti-malware software, email security, and appropriate procedures relating to removable
media such as laptops. Laptops are encrypted, and media leaving our premises and sent to third-party storage
facilities are also encrypted. Our commitment to security has earned ISO 27001:2013 Certification for our core
data centers, which is an international standard for best practices associated with our Information Security
Management System. See also “Item 1C. Cybersecurity.”
Intellectual Property
We own a significant number of intellectual property rights, including copyrights, trademarks, trade
secrets, and patents. Specifically, our policy language, insurance manuals, software, and databases are protected
by both registered and common law copyrights. and the licensing of those materials to our customers for their use
represents a large portion of our revenue. We also own in excess of 600 trademarks in the U.S. and foreign
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countries, including the names of our solutions and services and our logos and tag lines, many of which are
registered. We believe many of our trademarks, trade names, service marks, and logos to be of material
importance to our business, as they assist our customers in identifying our solutions and services and the quality
that stands behind them. We consider our intellectual property to be proprietary, and we rely on a combination of
statutory (for example, copyright, trademark, trade secret, and patent) and contractual safeguards in a
comprehensive intellectual property enforcement program to protect it wherever it is used.
We also own several patents and have several pending patent applications in the U.S. that complement
our solutions. We believe the protection of our proprietary technology is important to our success, and we will
continue to seek to protect those intellectual property assets for which we have expended substantial research and
development capital and that are material to our business.
To maintain control of our intellectual property, we enter into contractual agreements with our customers,
granting each customer permission to use our solutions and services, including our software and databases. This
helps maintain the integrity of our proprietary intellectual property and to protect the embedded information and
technology contained in our solutions. As a general practice, employees, contractors, and other parties with
access to our proprietary information sign agreements that prohibit the unauthorized use or disclosure of our
proprietary rights, information, and technology.
Human Capital
Our global workforce is united by our mission to serve, add value, and innovate for our customers. We
continue to invest in our people worldwide by encouraging all employees to reach their full potential through our
focus on learning, providing competitive compensation and benefits, and our culture anchored on our purpose
driven values of results, learning, and caring.
As a knowledge-based business, we carefully integrate the skills and talents of approximately
7,500 employees worldwide as of December 31, 2023. Most of our highly credentialed team holds advanced
degrees and professional certifications specializing in actuarial science, chemistry and physics, commercial
banking and finance, commodity analytics, data science and artificial intelligence, economics, engineering, GIS
mapping, meteorology, natural resources, predictive analytics, supply chain, and other fields.
Approximately 62% of our employees are based in the United States, 12% in the United Kingdom, 8% in
India, with the remainder serving in 18 other countries across the globe.
Very few of our employees are represented by unions or subject to collective bargaining agreements, and
only a small number of employees in Germany are represented by a works council. We consider our relationship
with our employees to be good and have not experienced interruptions of operations due to labor disagreements.
We support and work to inspire our people with a collaborative and engaging culture, and career
development and learning opportunities at all levels, competitive compensation and benefits, an ongoing focus on
well-being, and responsive leadership. Starting in 2021, we introduced a common global wellbeing day across
the enterprise to recognize the importance of the total wellbeing of our workforce. In addition, in 2022,
we introduced Juneteenth as a U.S. holiday to recognize this significant milestone in U.S. history.
In 2023, career development across the Company was prioritized. We listened to employee and manager
feedback and implemented an employee-centric strategy. We took the first step towards providing clearer
pathways for career progression with the new Career Framework. We started this journey to create a structure
that organizes jobs and supports career growth. We believe the Career Framework will put Verisk in a better
position to attract, retain, and engage talent to help us meet our current and future business needs. The framework
will provide clarity on what it means to be in a certain role, so employees can leverage it to set goals and find
different development opportunities within the Company.
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Each quarter, employees and managers were provided customized training and were prompted to review
and discuss goals, progress, and ways to grow and develop. We supported managers by offering targeted training
around having productive career conversations. We saw meaningful impact from this training. 63% of managers
attended and 75% of managers who attended confirmed having career conversations with their direct reports.
This year, we also introduced in-person, conference style career events in five major locations, globally
“CareerCon”. These events (attended by 755 employees globally) were structured around topics that included
career pivots, career growth and career development tools. In addition, over 11,500 attendees were recorded at
various targeted training sessions and “Learning Breaks” on topics that included leadership, motivation,
feedback, creativity, and learning.
Our leadership development programs are targeted at rising professionals and first-time managers. Both
programs were redesigned to align with our new corporate values and achieved global reach with the addition of
APAC cohorts. Our rising professionals program participation increased by 20% in 2023. The 2023 Leadership
Meeting brought together 107 thought leaders across our business. The event fostered understanding of business
strategy, visibility, and alignment on 2023 key priorities, and created momentum and engagement for the future.
New for 2023, we introduced a targeted learning program for a small group of high potential talent, giving them
access to meet members of our Board of Directors and network across business lines.
Throughout this year of change and steady improvement, we continued to have an engaged employee
population. We continued to curate self-paced learning resources and create real-time opportunities for
employees to take charge of their development and learn from each other. All employees have access to our
world-class virtual learning platform, which features thousands of courses taught by industry experts. Employees
focused on building leadership, organizational, and technical skills on the platform. Course enrollments remained
steady at approximately 49,000. Enrollment on our more specialized, long-form learning platform increased by
35%. Learners spent an average of 15 hours on the platform.
We offer competitive salaries, short and long-term incentives, and the opportunity for advancement. In
addition, our program includes paid time off (“PTO”), flextime and telecommuting options, and a 401(k)
program with a 100% company cash match (up to 6%). We also offer health insurance plans, no-cost life
insurance equivalent to annual salary (with the option to purchase more), a discounted stock purchase program, a
variety of physical, mental, and financial well-being offerings and resources, and more. Terms vary by business
unit and country.
Employees can also take advantage of our employee networks, grassroots groups that help support
diversity-related programs and events and promote an inclusive community. We currently have eight networks:
the Verisk Women’s Network, the Verisk Pride Network, the Verisk Veterans and Military Service Members
Network, the Verisk REACH Network (dedicated to empowering Black employees), the Verisk Parents Network,
the Verisk Unidos Network (promoting awareness of Hispanic and Latinx culture), the Verisk Asian Network,
the Verisk Accessibility Network, and the recently added Verisk Indigenous Network, launched to commemorate
National Day for Truth and Reconciliation in September. In 2023, our Employee Networks (ENs) increased in
membership with almost one-third of Verisk employees worldwide in at least one employee network.
A global mentoring program sponsored by our ENs is helping participants find an inclusive space in
which to develop themselves, grow their careers, and build community. Over 200 mentee/mentor pairs
participated in this year’s cohort, spanning 14 business functions, 30 locations and 11 countries. Almost 2,000
hours of mentoring were delivered though this formal program in 2023.
We hosted our second installment of Days of Understanding in July, as part of the CEO action Pledge for
Diversity & Inclusion. Sessions were held over three days that tackled courageous topics and conversations
around colorism, transgender rights, women’s rights, working parent challenges, and navigating a civilian world.
More than 1,000 employees around the globe attended.
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In 2023, we sought to broaden our talent pool by strengthening relationships with professional
organizations and career conferences advancing the interest of underrepresented groups. We engaged with
several organizations supporting Black and Latino actuaries and engineers, people of color in the insurance
industry, women in insurance and technology, and LGBTQ+ professionals in IT and other sectors in India. These
organizations include Association of Professional Insurance Women (APIW), Black Engineer of the Year Award
(BEYA), Gamma Iota Sigma, International Association of Black Actuaries (IABA), National African American
Insurance Association (NIAAIA), Organization Latino Actuaries (OLA), and Reimagining Inclusion for Social
Equity (RISE).
In 2023, over 800 Verisk employees across 23 locations and 7 countries registered volunteer hours during
Verisk Volunteer Week. Efforts included a Rise Against Hunger event with over 50,000 meals packed, donation
drives, and local community cleanup activities.
The health and safety of our people working around the globe is a top priority, and our facilities
worldwide follow rigorous, internally and externally audited, occupational health and safety policies. We also
recognize that protecting the health, safety and wellbeing of our employees is crucial to our ability to continue to
address the impact of the global COVID-19 pandemic.
The majority of our people worked remotely in 2021 but moved to a hybrid work policy in 2022 and 2023
with at least 2 days in the office. Senior leaders moved to 3 days in the office in 2023. We saw increased
collaboration and engagement as a result of these moves.
Our employee engagement score for 2023 is at 78%, a 1%-point increase since 2022. Verisk continues to
be recognized for our outstanding workplace culture by Great Place to Work® in the U.S., receiving certification
for the eighth consecutive year. In 2023, Verisk was certified for the fourth time in the United Kingdom, Spain,
and India, and was certified for the second time in Poland. Employees feel Verisk meets the benchmark for
innovation, inclusivity, company values, and leaders’ effectiveness. We are also earning recognition from seven
of the Best Workplaces™ lists including UK’s Best Workplaces, UK’s Best Workplace for Women, Spain’s Best
Workplaces, and Poland’s Best Workplaces. The Great Place to Work Institute is a global authority on high-trust,
high-performance workplaces. To achieve certification, Verisk employees are surveyed on the extent to which
they reported a consistently great workplace experience. To create an outstanding employee experience, leaders
understand and act on their results and insights, and continuously communicate with employees through town
halls and local engagement events.
Regulation
Because our business involves the distribution of certain personal, public, and nonpublic data to
businesses and governmental entities that make eligibility, service, and marketing decisions based on such data,
certain of our solutions and services are subject to regulation under federal, state, and local laws in the U.S. and,
to a lesser extent, in foreign countries. Examples of such regulation include the Fair Credit Reporting Act, which
regulates the use of consumer credit report information; the Gramm-Leach-Bliley Act, which regulates the use of
nonpublic personal financial information held by financial institutions and applies indirectly to companies that
provide services to financial institutions; the Drivers Privacy Protection Act, which prohibits the public
disclosure, use, or resale by any state’s department of motor vehicles of personal information about an individual
that was obtained by the department in connection with a motor vehicle record, except for a “permissible
purpose”; and various other federal, state, and local laws and regulations.
Those laws generally restrict the use and disclosure of personal information and provide consumers
certain rights to know the manner in which their personal information is being used, to challenge the accuracy of
such information, and/or to prevent the use and disclosure of such information. In certain instances, the laws also
impose requirements for safeguarding personal information through the issuance of data security standards or
guidelines. Certain state laws impose similar privacy obligations as well as obligations to provide notification of
security breaches in certain circumstances.
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We are also licensed as a rating, rate service, advisory, or statistical organization under state insurance
codes in all 50 states, Puerto Rico, Guam, the U.S. Virgin Islands, and the District of Columbia. As such an
advisory organization, we provide statistical, actuarial, policy language development, and related solutions and
services to P&C insurers, including advisory prospective loss costs, other prospective cost information, manual
rules, and policy language. We also serve as an officially designated statistical agent of state insurance regulators
to collect policy writing and loss statistics of individual insurers and compile that information into reports used
by the regulators.
Many of our solutions, services, and operations as well as insurers’ use of our services are subject to state
rather than federal regulation by virtue of the McCarran-Ferguson Act. As a result, many of our operations and
solutions are subject to review and/or approval by state regulators. Further, our operations involving licensed
advisory organization activities are subject to periodic examinations conducted by state regulators; and our
operations and solutions are subject to state antitrust and trade practice statutes within or outside state insurance
codes, which are typically enforced by state attorneys general and/or insurance regulators.
Available Information
We maintain an Investor Relations website on the Internet at investor.verisk.com. We make available free
of charge on or through this website, our annual, quarterly, and current reports and any amendments to those
reports as soon as reasonably practicable following the time they are electronically filed with or furnished to the
U.S. Securities and Exchange Commission (“SEC”). For access to the filings, click the “SEC Filings” link on the
“Financials” tab on our Investor Relations homepage. The contents of our website are not incorporated into this
filing. Verisk trades on the NASDAQ Global Market in the Nasdaq Global Select Market segment under the
ticker symbol “VRSK.” Our stock was first publicly traded on October 7, 2009.
The public may read any materials filed by Verisk with the SEC on the SEC’s Internet site
(www.sec.gov), which contains reports, proxy and information statements, and other information regarding
issuers that file electronically with the SEC.
Item 1A. Risk Factors
You should carefully consider the following risks and all of the other information set forth in this annual
report on Form 10-K before deciding to invest in any of our securities. If any of the following risks actually
occurs, our business, financial condition or results of operations would likely suffer. In such case, the trading
price of our securities, including our common stock, could decline due to any of these risks, and you may lose all
or part of your investment.
Strategic and Operational Risks Related to Our Business
We are subject to competition in many of the markets in which we operate and we may not be able to
compete effectively.
Some markets in which we operate or which we believe may provide growth opportunities for us are
highly competitive, and are expected to remain highly competitive. We compete on the basis of quality, customer
service, product and service selection, and pricing. Our competitive position in various market segments depends
upon the relative strength of competitors in the segment and the resources devoted to competing in that segment.
Due to their size, certain competitors may be able to allocate greater resources to a particular market segment
than we can. As a result, these competitors may be in a better position to anticipate and respond to changing
customer preferences, emerging technologies and market trends. In addition, new competitors and alliances may
emerge to take market share away, and as we enter into new lines of business, due to acquisition or otherwise, we
face competition from new players with different competitive dynamics. We may be unable to maintain our
competitive position in our market segments, especially against larger competitors. We may also invest further to
upgrade our systems in order to compete. If we fail to successfully compete, our business, financial position and
results of operations may be adversely affected.
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To the extent the availability of free or relatively inexpensive information increases, the demand for some of
our solutions may decrease.
Public sources of free or relatively inexpensive information have become increasingly available recently,
particularly through the Internet, and this trend is expected to continue. Governmental agencies in particular have
increased the amount of information to which they provide free public access. Public sources of free or relatively
inexpensive information may reduce the demand for our solutions. To the extent that customers choose not to
obtain solutions from us and instead rely on information obtained at little or no cost from these public sources,
our business and results of operations may be adversely affected.
If we are unable to develop successful new solutions or if we experience defects, failures and delays
associated with the introduction of new solutions, our business could suffer serious harm.
Our growth and success depend upon our ability to develop and sell new solutions. If we are unable to
develop new solutions, or if we are not successful in introducing and/or obtaining regulatory approval or
acceptance for new solutions, or products we develop face sufficient pricing pressure to make them unattractive
to pursue, we may not be able to grow our business, or growth may occur more slowly than we anticipate. In
addition, significant undetected errors or delays in new solutions may affect market acceptance of our solutions
and could harm our business, financial condition or results of operations. In the past, we have experienced delays
while developing and introducing new solutions, primarily due to difficulties in developing models, acquiring
data and adapting to particular operating environments. Errors or defects in our solutions that are significant, or
are perceived to be significant, could result in rejection of our solutions, damage to our reputation, loss of
revenues, diversion of development resources, an increase in product liability claims, and increases in service and
support costs and warranty claims.
We typically face a long selling cycle to secure new contracts that require significant resource
commitments, which result in a long lead time before we receive revenues from new relationships.
We typically face a long selling cycle to secure a new contract and there is generally a long preparation
period in order to commence providing the services. We typically incur significant business development
expenses during the selling cycle and we may not succeed in winning a new customer’s business, in which case
we receive no revenues and may receive no reimbursement for such expenses. Even if we succeed in developing
a relationship with a potential new customer, we may not be successful in obtaining contractual commitments
after the selling cycle or in maintaining contractual commitments after the implementation cycle, which may
have a material adverse effect on our business, results of operations and financial condition.
We could lose our access to data from external sources, which could prevent us from providing our
solutions.
We depend upon data from external sources, including data received from customers and various
government and public record services, for information used in our data repositories. In general, we do not own
the information in these data repositories, and the participating organizations could discontinue contributing
information to the data repositories. Our data sources could withdraw or increase the price for their data for a
variety of reasons, and we could also become subject to legislative, judicial, or contractual restrictions on the use
of such data, in particular if such data is not collected by the third parties in a way that allows us to legally use
and/or process the data. We are also reliant on internal controls of third parties to ensure the accuracy of their
data. If a third party suffers reputational damage from an underlying issue, we may discontinue using their
services. If a substantial number of data sources, or certain key sources, were to withdraw or be unable to provide
their data, or if we were to lose access to data due to government regulation, decline in reputation or if the
collection of data became uneconomical, our ability to provide solutions to our customers could be impacted,
which could materially adversely affect our business, reputation, financial condition, operating results, and cash
flows.
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Agreements with our data suppliers are short-term agreements. Some suppliers are also competitors,
which may make us vulnerable to unpredictable price increases and may cause some suppliers not to renew
certain agreements. Our competitors could also enter into exclusive contracts with our data sources. If our
competitors enter into such exclusive contracts, we may be precluded from receiving certain data from these
suppliers or restricted in our use of such data, which would give our competitors an advantage. Such a
termination or exclusive contracts could have a material adverse effect on our business, financial position, and
operating results if we were unable to arrange for substitute data sources.
We derive a substantial portion of our revenues from U.S. P&C primary insurers. If there is a downturn in
the U.S. insurance industry or that industry does not continue to accept our solutions, our revenues will
decline.
Revenues derived from solutions we provide to U.S. P&C primary insurers account for a substantial
portion of our total revenues. During the year ended December 31, 2023, approximately 69% of our revenue was
derived from solutions provided to U.S. P&C primary insurers. Also, our invoices for certain of our solutions
are linked in part to premiums in the U.S. P&C insurance market, which may rise or fall in any given year due to
loss experience and capital capacity and other factors in the insurance industry that are beyond our control. In
addition, our revenues will decline if the insurance industry does not continue to accept our solutions.
Factors that might affect the acceptance of these solutions by P&C primary insurers include the
following:
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changes in the business analytics industry;
changes in technology;
our inability to obtain or use state fee schedule or claims data in our insurance solutions;
saturation of market demand;
loss of key customers;
industry consolidation; and
failure to execute our customer-focused selling approach.
A downturn in the insurance industry, pricing pressure or lower acceptance of our solutions by the
insurance industry could result in a decline in revenues from that industry and have a material adverse effect on
our financial condition, results of operations and cash flows.
Acquisitions, other strategic relationships and dispositions of our business, and related integration and
separation risks, could result in operating difficulties and other harmful consequences, and we may not be
successful in achieving the anticipated benefits of such transactions.
Our long-term business strategy includes growth through acquisitions and other strategic relationships.
Future acquisitions may not be completed on acceptable terms and acquired assets, data or businesses may not be
successfully integrated into our operations, and we may ultimately divest unsuccessful acquisitions or
investments. Moreover, from time to time we may also undertake dispositions of certain businesses or assets.
Any acquisitions, investments and dispositions will be accompanied by the risks commonly encountered in such
transactions. Such risks include, among other things:
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failing to implement or remediate controls, procedures and policies appropriate for a larger public
company at acquired companies that prior to the acquisition lacked such controls, procedures and
policies;
paying more than fair market value for an acquired company or assets, or receiving less than fair
market value for disposed businesses or assets;
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failing to integrate or separate the operations and personnel of the acquired or disposed businesses in an
efficient, timely manner;
assuming potential liabilities of an acquired company;
• managing the potential disruption to our ongoing business;
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distracting management focus from our core businesses;
failing to retain management at the acquired company;
difficulty in acquiring suitable businesses, including challenges in predicting the value an acquisition
will ultimately contribute to our business;
possibility of overpaying for acquisitions, particularly those with significant intangible assets that
derive value using novel tools and/or are involved in niche markets;
impairing relationships with employees, customers, and strategic partners;
incurring expenses associated with the amortization of intangible assets particularly for intellectual
property and other intangible assets;
incurring expenses associated with an impairment of all or a portion of goodwill and other intangible
assets due to changes in market conditions, weak economies in certain competitive markets, or the
failure of certain acquisitions to realize expected benefits; and
diluting the share value and voting power of existing stockholders.
The anticipated benefits of many of our acquisitions may not materialize. Future acquisitions or
dispositions could result in the incurrence of debt, contingent liabilities or amortization expenses, or write-offs of
goodwill and other intangible assets, any of which could harm our financial condition.
We may incur substantial additional indebtedness in connection with future acquisitions.
In order to finance acquisitions, which are an important part of our long-term growth strategy, we may
incur substantial additional indebtedness and such increased leverage could adversely affect our business. In
particular, the increased leverage could increase our vulnerability to sustained, adverse macroeconomic
weakness, limit our ability to obtain further financing and limit our ability to pursue other operational and
strategic opportunities. Further, the Federal Reserve has increased its benchmark interest rate multiple times in
2023 in a bid to reduce rising inflation rates in the United States. These interest rate increases have resulted in
higher short-term and long-term borrowing costs. The increased leverage, potential lack of access to financing
and increased expenses could have a material adverse effect on our financial condition, results of operations and
cash flows.
There may be consolidation in our end customer market, which could reduce the use of our services.
Mergers or consolidations among our customers could reduce the number of our customers and potential
customers. This could adversely affect our revenues even if these events do not reduce the aggregate number of
customers or the activities of the consolidated entities. If our customers merge with or are acquired by other
entities that are not our customers, or that use fewer of our services, they may discontinue or reduce their use of
our services. The adverse effects of consolidation will be greater in sectors that we are particularly dependent
upon, for example, in the P&C insurance sector. Any of these developments could materially adversely affect our
business, financial condition, operating results, and cash flows.
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Financial and Economic Risks Related to Our Business
General economic, political and market forces and dislocations beyond our control could reduce demand
for our solutions and harm our business.
The demand for our solutions may be impacted by domestic and international factors that are beyond our
control, including macroeconomic, political and market conditions, the energy transition driven by climate
change and decarbonization, the availability of short-term and long-term funding and capital, the level and
volatility of interest rates, currency exchange rates, and inflation. Any one or more of these factors may
contribute to reduced activity and prices in the securities markets generally and could result in a reduction in
demand for our solutions, which could have an adverse effect on our results of operations and financial condition.
A significant additional decline in the value of assets for which risk is transferred in market transactions could
have an adverse impact on the demand for our solutions.
Our financial position may be impacted by audit examinations or changes in tax laws or tax rulings.
Our existing corporate structure and tax positions have been implemented in a manner which we believe is
compliant with current prevailing tax laws. However, changes in existing tax laws or rulings, including Federal,
State and International, could have a significant impact on our effective tax rate, cash tax positions and deferred tax
assets and liabilities. Tax audit examinations with an adverse outcome could have a negative effect in the
jurisdictions in which we operate. Furthermore, the Organization for Economic Co-operation and Development
(OECD) has issued Pillar Two model rules for a global minimum tax of 15% that has been agreed upon in principle
by over 140 countries. Although we do not expect Pillar Two to materially increase our tax expense, the ultimate
impact will depend on the implementation of specific rules in each jurisdiction. Accordingly, we will continue to
monitor global legislative action for potential impacts. In addition, our tax positions are impacted by fluctuations in
our earnings and financial results in the various countries in which we do business.
Cybersecurity and Product/Technology Risks Related to Our Business
Fraudulent or unpermitted data access and other cyber-security or privacy breaches may negatively impact
our business and harm our reputation.
Security breaches in our facilities, computer networks, and data repositories may cause harm to our
business and reputation and result in a loss of customers. Many of our solutions involve the storage and
transmission of proprietary information and sensitive or confidential data, which are significantly complex with
various uses across businesses and locations. With a large number of inter-related systems, keeping the
technology current and managing vulnerabilities is challenging. As with other global companies, our systems are
regularly subject to cyber-attacks, cyber-threats, attempts at fraudulent access, physical break-ins, computer
viruses, attacks by hackers and similar disruptive problems. As cyber-threats continue to evolve, we are required
to expend significant additional resources to continue to modify and enhance our protective measures and to
investigate and remediate any information security vulnerabilities and incidents. Despite efforts to ensure the
integrity of our systems and implement controls, processes, policies and other protective measures, we may not
be able to anticipate or detect all security breaches or fraudulent access attempts, nor may we be able to
implement guaranteed preventive measures against such security breaches or fraudulent access attempts. Cyber-
threats are rapidly evolving and we may not be able to anticipate, prevent or detect all such attacks and could be
held liable for any security breach or loss.
Third-party contractors, including cloud-based service providers, also may experience security breaches
involving the storage and transmission of proprietary information. If users gain improper access to our data
repositories, they may be able to steal, publish, delete or modify confidential third-party information that is
stored or transmitted on our networks. Our business relies on the secure processing, transmission, storage and
retrieval of confidential, proprietary and other information in our computer and data management systems and
networks, and in the computer and data management systems and networks of third parties. In addition, to access
our network, products and services, our customers and other third parties may use personal mobile devices or
computing devices that are outside of our network environment and are subject to their own cybersecurity risks.
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In addition, customers’, employees’ or other’s misuse of and/or gaining fraudulent or unpermitted access
to or failure to properly secure our information or services could cause harm to our business and reputation and
result in loss of customers. Any such misappropriation and/or misuse of or failure to properly secure our
information could result in us, among other things, being in breach of certain data protection and related
legislation.
A security or privacy breach may affect us in the following ways:
deterring customers from using our solutions;
deterring data suppliers from supplying data to us;
harming our reputation;
exposing us to liability;
increasing operating expenses to correct problems caused by the breach;
affecting our ability to meet customers’ expectations; and/or
causing inquiry from governmental authorities.
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Incidents in which consumer data has been fraudulently or improperly acquired or viewed, or any other
security or privacy breaches, have in the past occurred, and may in the future occur and could go undetected. The
number of potentially affected consumers identified by any future incidents is inherently uncertain. Any such
incident could materially adversely affect our business, reputation, financial condition, operating results and cash
flows. In addition, media or other reports of perceived security vulnerabilities to our systems or those of our
third-party suppliers, even if no breach has been attempted or occurred, could also adversely impact our
reputation and materially impact our business.
We may lose key business assets, through the loss of data center capacity or the interruption of
telecommunications links, the internet, or power sources, which could significantly impede our ability to do
business.
Our operations depend on our ability, as well as that of third-party service providers to whom we have
outsourced several critical functions, to protect data centers, whether in cloud or dedicated environments, and
related technology against damage from hardware failure, fire, flood, power loss, telecommunications failure,
impacts of terrorism, breaches in security (such as the actions of computer hackers), natural disasters, or other
disasters. Certain of our facilities are located in areas that could be impacted by coastal flooding, earthquakes or
other disasters. The online services we provide are dependent on links to telecommunications providers. In
addition, we generate a significant amount of our revenues through telesales centers and websites that we utilize
in the acquisition of new customers, fulfillment of solutions and services and responding to customer inquiries.
We may not have sufficient redundant operations to cover a loss or failure in all of these areas in a timely
manner. Certain of our customer contracts provide that our online servers may not be unavailable for specified
periods of time. Any damage to our or our third-party service provider’s data centers, failure of our
telecommunications links or inability to access these telesales centers or websites could cause interruptions in
operations that materially adversely affect our ability to meet customers’ requirements, resulting in decreased
revenue, operating income and earnings per share.
A technology vendor that provides critical services, such as cloud-based infrastructure, creates a single
point of failure resulting in pricing or contract lock-in risk.
As our operations migrate to a cloud-based information technology infrastructure and delivery model
(distributed computing infrastructure platform for business), systems are consolidated into a smaller number of
large infrastructure suppliers. We cannot easily switch cloud providers, meaning that any disruption of or
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interference with our use of a particular supplier, would impact our operations and our business would be
adversely impacted. Any of the few of these suppliers could suffer an outage which would in turn result in an
outage for one or more of our products. These suppliers could also be subject to regulatory actions, or conflicts of
interest which could force us to seek alternative suppliers in a short time period, at an economic disadvantage.
Generative AI use by our customers or other third parties could result in the replacement of our existing
products and/or solutions or the reduction of their relevance.
For a subset of our products we rely on proprietary or copyrighted material which could be fed into
generative AI large language models without our knowledge. This could result in duplication of our products or
solutions by generative AI tools and reduce the relevance or value proposition of such products or solutions.
Our own use of AI, including but not limited to generative AI, to enhance our products could lead to
unanticipated consequences such as ethical, compliance, privacy-observing, bias-reducing, and/or
intellectual property issues.
Increasing use of AI, including but not limited to generative AI models, in our internal systems may
create new attack methods for adversaries and raise ethical, technological, legal, regulatory, and other challenges,
which may negatively impact our brands and demand for our products and services. Our business policies and
internal security controls may not keep pace with these changes as new threats emerge, or the emerging
cybersecurity regulations in jurisdictions worldwide. Additionally, we are actively adding new generative AI
features to our services. Because the generative AI landscape is developing and inherently risky, no assurance
can be given that such strategies and offerings will be successful or will not harm our reputation, financial
condition, and operating results. Product features that rely on generative AI may be susceptible to unanticipated
security threats from sophisticated adversaries.
We use analytical models to assist our customers in key areas, such as underwriting, claims, reserving, and
catastrophe risks, but actual results could differ materially from the model outputs and related analyses.
We use various modeling techniques (e.g., scenarios, predictive, stochastic and/or forecasting) and data
analytics to analyze and estimate exposures, loss trends and other risks associated with our products. We use the
modeled outputs and related analyses to assist customers with decision-making (e.g., underwriting, pricing,
claims, reserving, reinsurance, and catastrophe risk). The modeled outputs and related analyses are subject to
various assumptions, uncertainties, model errors and the inherent limitations of any statistical analysis, including
the use of historical internal and industry data. In addition, the modeled outputs and related analyses may
occasionally contain inaccuracies, perhaps in material respects, including as a result of inaccurate inputs or
applications thereof. Climate change and other variables may make modeled outcomes less certain or produce
new, non-modeled risks. Consequently, actual results may differ materially from our modeled results. If, based
upon these models or other factors, we provide inaccurate information to customers, or overestimate the risks we
are exposed to, new business growth and retention of our existing business may be adversely affected which
could have an adverse effect on our results of operations and financial condition.
Legal, Regulatory and Compliance Risks Related to Our Business
We will continue to rely upon proprietary technology rights, and if we are unable to protect them, our
business could be harmed.
Our success depends, in part, upon our intellectual property rights. To date, we have relied primarily on a
combination of copyright, patent, trade secret, and trademark laws and nondisclosure and other contractual
restrictions on copying and distribution to protect our proprietary technology. This protection of our proprietary
technology is limited, and our proprietary technology could be used by others without our consent. In addition,
patents may not be issued with respect to our pending or future patent applications, and our patents may not be
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upheld as valid or may not prevent the development of competitive products. Businesses we acquire also often
involve intellectual property portfolios, which increase the challenges we face in protecting our strategic
advantage. Any disclosure, loss, invalidity of, or failure to protect our intellectual property could negatively
impact our competitive position, and ultimately, our business. Our protection of our intellectual property rights in
the U.S. or abroad may not be adequate and others, including our competitors, may use our proprietary
technology without our consent. Furthermore, litigation may be necessary to enforce our intellectual property
rights, to protect our trade secrets, or to determine the validity and scope of the proprietary rights of others. Such
litigation could result in substantial costs and diversion of resources and could harm our business, financial
condition, results of operations, and cash flows.
Regulatory developments could negatively impact our business.
Because personal, public and non-public information is stored in some of our data repositories, we are
vulnerable to government regulation and adverse publicity concerning the use of our data. We provide many
types of data and services that already are subject to regulation under the Fair Credit Reporting Act, Gramm-
Leach-Bliley Act, Driver’s Privacy Protection Act, the European Union’s General Data Protection Regulation,
the Dodd Frank Wall Street Reform and Consumer Protection Act and to a lesser extent, various other federal,
state, and local laws and regulations. These laws and regulations are designed to protect the privacy of the public
and to prevent the misuse of personal information in the marketplace. However, many consumer advocates,
privacy advocates, and government regulators believe that the existing laws and regulations do not adequately
protect privacy. They have become increasingly concerned with the use of personal information, particularly
social security numbers, department of motor vehicle data and dates of birth. As a result, they are lobbying for
further restrictions on the dissemination or commercial use of personal information to the public and private
sectors. Similar initiatives are under way in other countries in which we do business or from which we source
data. We have implemented various measures to comply with the data privacy and protection principles of the
European Union’s General Data Protection Regulation, however, there can be no assurances that such methods
will be deemed fully compliant. If we are unable to comply with the data privacy and protection principles
adopted pursuant to the General Data Protection Regulation, it will impede our ability to conduct business
between the U.S. and the E.U. which could have a material adverse effect on our business, financial position,
results of operations or cash flows.
The following legal and regulatory developments also could have a material adverse effect on our
business, financial position, results of operations or cash flows:
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amendment, enactment, or interpretation of laws and regulations which restrict the access and use of
personal information and reduce the supply of data available to customers;
changes in cultural and consumer attitudes to favor further restrictions on information collection and
sharing, which may lead to regulations that prevent full utilization of our solutions;
failure of our solutions to comply with current and future laws and regulations; and
failure of our solutions to adapt to changes in the regulatory environment in an efficient, cost-effective
manner.
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We are subject to antitrust, consumer protection, intellectual property and other litigation, as well as
governmental investigations, and may in the future become further subject to such litigation and
investigations; an adverse outcome in such litigation or investigations could have a material adverse effect
on our financial condition, revenues and profitability.
We participate in businesses (particularly insurance-related businesses and services) that are subject to
substantial litigation, including antitrust, consumer protection and intellectual property litigation. In addition, our
insurance specialists are in the business of providing advice on standard contract terms, which if challenged
could expose us to substantial reputational harm and possible liability. We are subject to the provisions of a
1995 settlement agreement in an antitrust lawsuit brought by various state Attorneys General and private
plaintiffs, which imposes certain constraints with respect to insurer involvement in our governance and business.
Our failure to successfully defend or settle any litigation or resolve any governmental investigation could
result in liability that, to the extent not covered by our insurance, could have a material adverse effect on our
financial condition, revenues and profitability. Given the nature of our business, we may be subject to litigation
or investigation in the future. Even if the direct financial impact of such litigation or investigations is not
material, settlements or judgments arising out of such litigation or investigations could include further
restrictions on our ability to conduct business, including potentially the elimination of entire lines of business,
which could increase our cost of doing business and limit our prospects for future growth.
We could face claims for intellectual property infringement, which if successful could restrict us from using
and providing our technologies and solutions to our customers.
There has been substantial litigation and other proceedings, particularly in the U.S., regarding patent and
other intellectual property rights in the information technology industry. There is a risk that we are infringing, or
may in the future infringe, the intellectual property rights of third parties. We have, from time-to-time, been
subject to litigation alleging intellectual property infringement. We monitor third-party patents and patent
applications that may be relevant to our technologies and solutions and we carry out freedom to operate analysis
where we deem appropriate. However, such monitoring and analysis has not been, and is unlikely in the future to
be, comprehensive, and it may not be possible to detect all potentially relevant patents and patent applications.
Since the patent application process can take several years to complete, there may be currently pending
applications, unknown to us, that may later result in issued patents that cover our products and technologies. As a
result, we may infringe existing and future third-party patents of which we are not aware. As we expand our
operations there is a higher risk that such activity could infringe the intellectual property rights of third parties.
Third-party intellectual property infringement claims and any resultant litigation against us or our
technology partners or providers, could subject us to liability for damages, restrict us from using and providing
our technologies and solutions or operating our business generally, or require changes to be made to our
technologies and solutions. Even if we prevail, litigation is time consuming and expensive to defend and would
result in the diversion of management’s time and attention.
If a successful claim of infringement is brought against us and we fail to develop non-infringing
technologies and solutions or to obtain licenses on a timely and cost-effective basis, this could materially
adversely affect our business, reputation, financial condition, operating results, and cash flows.
We are subject to extensive procurement laws and regulations, including those that enable the U.S.
government to terminate contracts for convenience. Our business and reputation could be adversely
affected if we or those we do business with fail to comply with or adapt to existing or new procurement laws
and regulations which are constantly evolving.
We and others with which we do business must comply with laws and regulations relating to the award,
administration and performance of U.S. government contracts. Government contract laws and regulations affect
how we do business with our customers and impose certain risks and costs on our business. A violation of these
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laws and regulations by us, our employees, or others working on our behalf, such as a supplier or a joint venture
partner, could harm our reputation and result in the imposition of fines and penalties, the termination of our
contracts, suspension or debarment from bidding on or being awarded contracts, loss of our ability to perform
services and civil or criminal investigations or proceedings. In addition, costs to comply with new government
regulations can increase our costs, reduce our margins, and adversely affect our competitiveness.
Government contract laws and regulations can impose terms, obligations or penalties that are different
than those typically found in commercial transactions. One of the significant differences is that the U.S.
government may terminate any of our government contracts, not only for default based on our performance, but
also at its convenience. Generally, prime contractors have a similar right under subcontracts related to
government contracts. If a contract is terminated for convenience, we typically would be entitled to receive
payments for our allowable costs incurred and the proportionate share of fees or earnings for the work performed.
However, to the extent insufficient funds have been appropriated by the U.S. government to a particular program
to cover our costs upon a termination for convenience, the U.S. government may assert that it is not required to
appropriate additional funding. If a contract is terminated for default, the U.S. government could make claims to
reduce the contract value or recover its procurement costs and could assess other special penalties, in some cases
in excess of the contract value, exposing us to liability and adversely affecting our ability to compete for future
contracts and orders. In addition, the U.S. government could terminate a prime contract under which we are a
subcontractor, notwithstanding the fact that our performance and the quality of the products or services we
delivered were consistent with our contractual obligations as a subcontractor. Similarly, the U.S. government
could indirectly terminate a program or contract by not appropriating funding. The decision to terminate
programs or contracts for convenience or default could adversely affect our business and future financial
performance.
General Risk Factors related to our Business
Our operations are subject to additional risks inherent in international operations.
With operations in 19 countries, we provide services to the insurance industry worldwide, including
operations in various developing nations. Both current and future foreign operations could be adversely affected
by unfavorable geopolitical developments, including legal and regulatory changes; tax changes; changes in trade
policies; changes to visa or immigration policies; regulatory restrictions; government leadership changes;
political events and upheaval; sociopolitical instability; social, political or economic instability resulting from
climate change; and nationalization of our operations without compensation. Adverse activity in any one country
could negatively impact operations, increase our loss exposure under certain of our insurance products, and
could, otherwise, have an adverse effect on our business, liquidity, results of operations, and financial condition
depending on the magnitude of the events and our net financial exposure at that time in that country.
Conducting extensive international operations subjects us to risks that are inherent in international
operations, including challenges posed by different pricing environments and different forms of competition; lack
of familiarity and burdens of complying with foreign laws, legal standards, regulatory requirements, tariffs and
other barriers; unexpected changes in regulatory requirements, taxes, trade laws, tariffs, export quotas, custom
duties, or other trade restrictions; differing technology standards; difficulties in collecting accounts receivable;
difficulties in managing and staffing international operations; varying expectations as to employee standards;
potentially adverse tax consequences, including possible restrictions on the repatriation of earnings; and reduced
or varied protection for intellectual property rights in some countries. In addition, our international operations
subject us to obligations associated with anti-corruption laws and regulations, such as the U.K. Bribery Act 2010,
the U.S. Foreign Corrupt Practices Act and regulations established by the U.S. Office of Foreign Assets Control.
Government agencies and authorities have a broad range of civil and criminal penalties they may seek to impose
against companies for violations of export controls, anti-corruption laws or regulations, and other laws, rules,
sanctions, embargoes, and regulations.
28
Moreover, international operations could be interrupted and negatively affected by economic changes,
geopolitical regional conflicts, terrorist activity, political unrest, civil strife, acts of war, and other economic or
political uncertainties. All of these risks could result in increased costs or decreased revenues, either of which
could have a material adverse effect on our financial condition, results of operations and cash flows.
We may fail to attract and retain enough qualified employees to support our operations, which could have
an adverse effect on our ability to expand our business and service our customers.
Our business relies on large numbers of skilled employees and our success depends on our ability to
attract, train and retain a sufficient number of qualified employees. If our attrition rate increases, our operating
efficiency and productivity may decrease. We compete for employees not only with other companies in our
industry, but also with companies in other industries, such as software services, engineering services and
financial services companies, and there is a limited pool of employees who have the skills and training needed to
do our work.
If our business continues to grow, the number of people we will need to hire will increase. We will also
need to increase our hiring if we are not able to maintain our attrition rate through our current recruiting and
retention policies. Increased competition for employees could have an adverse effect on our ability to expand our
business and service our customers, as well as cause us to incur greater personnel expenses and training costs.
Physical and transition risks associated with climate change and its consequences could disrupt operations,
threaten the safety of employees, or negatively impact our financial performance.
While we seek to be a strategic partner to the global insurance industry in analyzing risks related to
climate change and building resilience, we recognize that there are inherent risks wherever business is
conducted. Climate-related events and its associated risks including acute physical risk such as heatwave,
hurricane/cyclone, inland flooding, and wildfire, and chronic physical risk such as sea level rise and water stress
could disrupt our operations and threaten the safety of our employees. Transition risks associated with achieving
a lower-carbon global economy encompassing policy and legal risk such as potential costs associated with the
introduction of mandatory global carbon pricing and potential regulatory mandates involving climate-related
reporting obligations, technology risk such as the potential increase in costs associated with a mandated transition
to low-emissions technologies, market risk such as the potential impacts of a market shift in customer demand
toward low-carbon solutions, and reputation risk such as potential impacts on our business from increasing
stakeholder expectations related to real or perceived deficiencies associated with our climate leadership, strategy,
performance, or disclosures could negatively impact our financial performance.
We are transitioning to a new Enterprise Resource Planning system and our ability to manage our business
and monitor results is highly dependent upon information and communication systems. A failure of these
systems or the ERP implementation could disrupt our business and results of operations.
We are highly dependent upon a variety of internal computer and telecommunication systems to operate
our business, including our enterprise resource planning (“ERP”) systems.
In order to continue support of our growth, we are making significant technological upgrades to our
information systems. We are in the process of implementing a company-wide, single ERP software system and
related processes to perform various functions and improve on the efficiency of our global business. This is a
lengthy and expensive process that will result in a diversion of resources from other operations. Continued
execution of the project plan, or a divergence from it, may result in cost overruns, project delays or business
interruptions. In addition, divergence from our project plan could impact the timing and/or extent of benefits we
expect to achieve from the system and process efficiencies.
29
Any disruptions, delays or deficiencies in the design and/or implementation of the new ERP system, or in
the performance of our legacy systems, particularly any disruptions, delays or deficiencies that impact our
operations, could adversely affect our ability to effectively run and manage our business and adversely affect our
reputation, competitive position, business, results of operations and financial condition.
Risks Related to Our Common Stock
If there are substantial sales of our common stock, our stock price could decline.
The market price of our common stock could decline as a result of sales of a large number of shares of
our common stock in the market, or the perception that these sales could occur. These sales, or the possibility that
these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and
at a price that we deem attractive. As of December 31, 2023, our ten largest shareholders owned 40.3% of our
common stock, including 2.5% of our common stock owned by our Employee Stock Ownership Plan or ESOP.
Such stockholders are able to sell their common stock in the public market from time to time without registration,
and subject to limitations on the timing, amount and method of those sales imposed by securities laws. If any of
these stockholders were to sell a large number of their common stock, the market price of our common stock
could decline significantly. In addition, the perception in the public markets that sales by them might occur could
also adversely affect the market price of our common stock.
Pursuant to our equity incentive plans, options to purchase approximately 2,732,670 shares of common
stock were outstanding as of February 16, 2024. We filed a registration statement under the Securities Act, which
covers the shares available for issuance under our equity incentive plans (including for such outstanding options)
as well as shares held for resale by our existing stockholders that were previously issued under our equity
incentive plans. Such further issuance and resale of our common stock could cause the price of our common
stock to decline.
Also, in the future, we may issue our securities in connection with investments and acquisitions. The
amount of our common stock issued in connection with an investment or acquisition could constitute a material
portion of our then outstanding common stock.
Our capital structure, level of indebtedness and the terms of anti-takeover provisions under Delaware law
and in our amended and restated certificate of incorporation and bylaws could diminish the value of our
common stock and could make a merger, tender offer or proxy contest difficult or could impede an attempt
to replace or remove our directors.
We are a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation
Law may discourage, delay or prevent a change in control by prohibiting us from engaging in a business
combination with an interested stockholder for a period of three years after the person becomes an interested
stockholder, even if a change of control would be beneficial to our existing stockholders. In addition, our
certificate of incorporation and bylaws may discourage, delay or prevent a change in our management or control
over us that stockholders may consider favorable or make it more difficult for stockholders to replace directors
even if stockholders consider it beneficial to do so. Our certificate of incorporation and bylaws:
•
•
•
•
authorize the issuance of “blank check” preferred stock that could be issued by our Board of Directors
to increase the number of outstanding shares to thwart a takeover attempt;
prohibit cumulative voting in the election of directors, which would otherwise allow holders of less
than a majority of the stock to elect some directors;
require that vacancies on the Board of Directors, including newly created directorships, be filled only
by a majority vote of directors then in office;
limit who may call special meetings of stockholders;
30
•
•
prohibit stockholder action by written consent, requiring all stockholder actions to be taken at a
meeting of the stockholders; and
establish advance notice requirements for nominating candidates for election to the Board of Directors
or for proposing matters that can be acted upon by stockholders at stockholder meetings.
In addition, Section 203 of the Delaware General Corporation Law may inhibit potential acquisition bids
for us. As a public company, we are subject to Section 203, which regulates corporate acquisitions and limits the
ability of a holder of 15% or more of our stock from acquiring the rest of our stock. Under Delaware law, a
corporation may opt out of the anti-takeover provisions, but we do not intend to do so.
These provisions may prevent a stockholder from receiving the benefit from any premium over the
market price of our common stock offered by a bidder in a potential takeover. Even in the absence of an attempt
to effect a change in management or a takeover attempt, these provisions may adversely affect the prevailing
market price of our common stock if they are viewed as discouraging takeover attempts in the future.
Item 1B. Unresolved Staff Comments
Not Applicable.
Item 1C. Cybersecurity
We remain steadfast in our commitment to safeguarding the confidentiality, integrity, availability, and
responsible use of data. Our rigorous approach to cybersecurity is a comprehensive framework comprising cyber
risk governance, risk identification and management, risk prevention and protection, monitoring and detection,
and response and recovery planning, which is an integral part of our overall enterprise risk management
(“Framework”).
Cyber risk governance is founded on direction and priorities established by our leadership, supported and
overseen by the Board of Directors (Board), and deployed through our Framework. The Framework leverages
proven standards such as those embedded in the National Institute of Standards and Technology (“NIST”)
Cybersecurity Framework (“CSF”), which are generally accepted by cybersecurity leaders across industries.
The Board oversees our management of cybersecurity, including oversight of appropriate risk mitigation
strategies. The Board receives regular reports from executives about our cybersecurity risks, management review
processes, overall health and readiness to respond to an incident. As of February 2024, the Board established and
convened the first meeting of the Risk Committee of the Board, which in coordination with other relevant Board
Committees as appropriate, oversees risk assessment and risk management, including but not limited to the
policies, procedures and strategic approach to cyber, technology and information security risks. The Risk
Committee of the Board also reports material cybersecurity risks to our full Board.
The Executive Risk Management Committee (“ERMC”), which includes the top corporate executives, is
responsible for providing guidance and enforcing our Framework, including the strategies, policies, procedures,
processes, and systems, established by management to identify, assess, measure, monitor, and manage risks. The
ERMC also reinforces the corporate risk appetite, determines whether residual risk is acceptable, and confirms
materiality of security incidents.
The Enterprise Risk Management (“ERM”) division oversees and advises on implementation of the
Framework throughout our business units. In doing so, the ERM division aggregates and assesses risk across the
enterprise. Within the ERM division is the Chief Information Security Officer (“CISO”), who leads our
Cybersecurity and Information Risk Management functions. The CISO’s functions partner with the business
units to help ensure that cybersecurity risk management strategies are implemented and dedicated liaisons from
31
the business units report to the CISO with meaningful cybersecurity risks, threats, incidents and vulnerabilities in
accordance with the CISO’s reporting framework. The ERM division hosts training and awareness sessions,
sponsors working groups across the enterprise on critical security topics and provides centralized cybersecurity
incident response. Also within the ERM division is our third-party risk program, which implements processes to
identify cybersecurity risk associated with our third-party providers. Management, including the CISO and our
cybersecurity team, regularly update the Risk committee on our cybersecurity programs, material cybersecurity
risks and mitigation strategies and provide cybersecurity reports quarterly that cover, among other topics,
third-party assessments of the company’s cybersecurity programs, developments in cybersecurity and updates to
the company’s cybersecurity programs and mitigation strategies.
Our business units have dedicated liaisons for risk management activities, who participate in a global
security council designed to facilitate implementation of the Framework and associated policies. As custodians
and/or processors of our stakeholders’ data, our business units also accept certain compliance responsibilities,
including but not limited to, aspects of the General Data Protection Regulation (“GDPR”), the California
Consumer Privacy Act (CCPA), the Gramm-Leach Bliley Act (“GLBA”), the Health Insurance Portability and
Accountability Act (“HIPAA”), the Fair Credit Reporting Act (“FCRA”), and the Payment Card Industry (“PCI”)
standard, all to the extent applicable. For each of its business units, we seek to actively confirm that its risk
management practices fulfill applicable compliance requirements.
We have adopted a defense-in-depth strategy with a wide range of measures to secure our technology
infrastructure and data as per our Framework. Security measures cover the following key areas as aligned with
NIST CSF: risk identification and management, risk prevention and protection, monitoring and detection, and
response and recovery planning. Key control functions that comprise the security measures include but are not
limited to: risk assessment, asset management, supply chain risk management, identity and access management,
customer credentialing, physical security, application and infrastructure security, perimeter and network security,
secure development and change management, configuration management, endpoint security, security audit
logging and monitoring, security operations center, incident response, business continuity and disaster recovery.
Our cybersecurity strategy includes the engagement of strategic providers, consultants and independent
assessors to inform us of cyber threats and assess the effectiveness of control design and implementation.
Strategic providers include, but are not limited to, a Managed Security Service Provider for our security
operations center, as well as service providers that supplement incident response processes related to threat
intelligence and dark web monitoring. Independent assessors include, but are not limited to, our Internal Audit
Department which provides reports to the Audit Committee, as well as assessors that are engaged directly to
perform external audits and penetration tests. Through independent assessors, our commitment to security has
earned ISO 27001:2013 Certification for our core ERM centrally provided cybersecurity services, which is an
international standard for best practices associated with our Information Security Management System.
To date, risks from cybersecurity threats have not materially affected, and we currently do not expect that
such risks are reasonably likely to materially affect, our business strategy, results of operations, or financial
condition. As discussed more fully under “Item 1A – Risk Factors,” although our processes are designed to help
identify, protect, detect, respond to and mitigate potential cybersecurity incidents, cybersecurity threats are
rapidly evolving and we may not be able to anticipate, prevent or detect all such attacks and there is no guarantee
that a future cybersecurity incident would not materially affect our business strategy, results of operations, or
financial condition.
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Item 2.
Properties
Our headquarters are in Jersey City, New Jersey. As of December 31, 2023, our principal offices
consisted of the following properties:
Location
Square Feet
Lease Expiration Date
Jersey City, New Jersey . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lehi, Utah . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Boston, Massachusetts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hyderabad, India . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
London, United Kingdom . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Krakow, Poland . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
352,765 December 31, 2033
124,986 April 30, 2031
115,271 November 30, 2030
September 30, 2028
92,442
50,677 November 29, 2030
21,519
June 30, 2028
We also lease offices in 16 states in the U.S., and 18 offices outside the U.S. to support our international
operations in Australia, Canada, China, Costa Rica, France, Germany, India, Ireland, Italy, Japan, Nepal, Poland,
Republic of Korea, Singapore, Spain, Singapore, Sweden, and UK.
We believe that our properties are in good operating condition and adequately serve our current business
operations. We also anticipate that suitable additional or alternative space, including those under lease options,
will be available at commercially reasonable terms for future expansion.
Item 3.
Legal Proceedings
See Note 21, Commitments and Contingencies, to the consolidated financial statements included in
Item 8 Part II of this 10-K for information regarding certain legal proceedings in which we are involved.
Item 4. Mine Safety Disclosures
Not Applicable.
PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
Market Information
Verisk trades under the ticker symbol “VRSK” on the NASDAQ Global Select Market. As of
February 16, 2024, there were approximately 74 stockholders of record. We believe the number of beneficial
owners is substantially greater than the number of record holders because a large portion of common stock is
held in “street name” by brokers.
On February 14, 2023, April 25, 2023, July 26, 2023, and October 25, 2023, our Board approved a cash
dividend of $0.34 per share of common stock issued and outstanding to the holders of record as of March 15,
2023, June 15, 2023, September 15, 2023, and December 15, 2023, respectively. Cash dividends of
$196.8 million and $195.2 million were paid during the years ended December 31, 2023 and 2022 and recorded
as a reduction to retained earnings, respectively. We have a publicly announced share repurchase plan and
repurchased a total of 86,204,465 shares since our IPO through December 31, 2023. As of December 31, 2023,
we had 400,694,309 shares of treasury stock.
33
Performance Graph
The graph below compares the cumulative total stockholder return on $100 invested in our common
stock, with the cumulative total return on $100 invested in the S&P 500 index, an aggregate index of our proxy
peers used in our Notice of Annual Meeting of Stockholders and Proxy Statement filed with the Securities and
Exchange Commission on April 7, 2023 and an aggregate index of our proxy peer used in our Notice of Annual
Meeting of Stockholders and Proxy Statement to be filed within 120 days of December 31, 2023 (the “Proxy
Statement”). In the transition year, the table and the graph below include both the prior and the new indices of
peer companies. The new peer issuers used for this graph are Black Knight, Inc., Nasdaq Inc., CoStar Group
Inc., Equifax Inc., Fair Isaac Corp., Gartner, Inc., Global Payments, Inc., Clarivate PLC, Intercontinental
Exchange, Inc., Jack Henry & Associates Inc., Moody’s Corporation, MSCI Inc., S&P Global, and TransUnion.
The old peer issuers used for this graph are Black Knight, Inc., CoreLogic Inc. (as of June 3, 2021, CoreLogic
was no longer a publicly-traded company), CoStar Group Inc., Equifax Inc., Fair Isaac Corp., Gartner, Inc.,
Global Payments, Inc., IHS Markit (as of February 26, 2022, IHS Markit was no longer a publicly-traded
company), Intercontinental Exchange, Inc., Jack Henry & Associates Inc., Moody’s Corporation, MSCI Inc.,
S&P Global, and TransUnion. The graph assumes that the value of investment in our common stock and each
index was $100 at December 31, 2018 and that all cash dividends were reinvested.
COMPARISON OF CUMULATIVE TOTAL RETURN
Assumes $100 Invested on December 31, 2018
Assumes Dividend Reinvested
Fiscal Year Ended December 31, 2023
270
250
230
210
190
170
150
130
110
90
81-ceD
91-ceD
02-ceD
12-ceD
22-ceD
32-ceD
Verisk Analytics, Inc.
S&P 500 Index
New Peer Group
Old Peer Group
Recent Sales of Unregistered Securities
We had no unregistered sales of equity securities during 2023.
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Issuer Purchases of Equity Securities
Under the Repurchase Program, we may repurchase stock in the market or as otherwise determined by us.
These authorizations have no expiration dates and may be suspended or terminated at any time. As of
December 31, 2023, we had $641.5 million available to repurchase shares, being the remaining unused portion of
a $3.0 billion authorization, which became effective on February 1, 2023. Our share repurchases for the quarter
ended December 31, 2023 are set forth below:
Period
Total Number
of Shares
Purchased
Average
Price Paid
per Share
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
Approximate Dollar
Value of Shares that
May Yet Be
Purchased Under the
Plans or Programs
October 1, 2023 through October 31, 2023 . . . . .
November 1, 2023 through November 30,
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 1, 2023 through December 31,
—
—
—
—
—
—
2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,738,711(1,2) $225.76(1,2)
1,738,711
1,738,711(1,2) $225.76(1,2)
1,738,711
(in millions)
$891.5
$891.5
$641.5
(1)
(2)
In March 2023, we entered into Accelerated Share Repurchase (“ASR”) agreements to repurchase shares of
our common stock for an aggregate purchase price of $2.5 billion with Citibank, N.A. and Goldman Sachs
& Co. LLC, respectfully. The ASR agreements are accounted for as treasury stock transactions and forward
stock purchase agreements indexed to our common stock. Upon payment of the aggregate purchase price on
March 7, 2023, we received an initial delivery of an aggregate of 10,655,301 shares of our common stock at
an initial price of $187.70 per share, representing approximately 80 percent of the aggregate purchase price.
Upon the final settlement of this ASR agreement in December of 2023, we received 865,232 additional
shares, as determined by the daily volume weighted average share price of our common stock of $217.00
during the term of these ASR agreements.
In December 2023, we entered into an additional ASR agreement to repurchase shares of our common stock
for an aggregate purchase price of $250.0 million with Goldman Sachs & Co. LLC. The ASR agreement is
accounted for as a treasury stock transactions and a forward stock purchase agreement indexed to our
common stock. Upon payment of the aggregate purchase price on December 14, 2023, we received an initial
delivery of 873,479 shares of our common stock at an initial price of $243.28 per share, representing
approximately 85 percent of the aggregate purchase price. Upon the final settlement of this ASR agreement
in February 2024, we received 178,227 additional shares as determined by the daily volume weighted
average share price of our common stock of $237.71 during the term of this ASR agreement.
Item 6.
[Reserved]
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion should be read in conjunction with our historical financial statements and the
related notes included elsewhere in this annual report on Form 10-K. This discussion contains forward-looking
statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in
or implied by any of the forward-looking statements as a result of various factors, including but not limited to
those listed under “Risk Factors” and “Special Note Regarding Forward-Looking Statements.” New risks and
uncertainties come up from time to time, and it is impossible to predict these events or how they may affect us.
We have no obligation to update any forward-looking statements after the date hereof, except as required by
applicable federal securities law. This discussion includes a comparison of our results of operations, liquidity
and capital resources, financing and financing capacity and cash flow for the years ended December 31, 2023
and 2022.
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We are a leading data analytics provider serving clients in the insurance markets. Using advanced
technologies to collect and analyze billions of records, we draw on unique data assets and deep domain expertise
to provide innovations that may be integrated into client workflows. We offer predictive analytics and decision
support solutions to clients in rating, underwriting, claims, catastrophe and weather risk, global risk
analytics, and many other fields. In the U.S., and around the world, we help clients protect people, property, and
financial assets. Refer to Item 1. Business for further discussion.
Our clients use our solutions to make better decisions about risk and opportunities with greater
efficiency and discipline. We refer to these products and services as “solutions” due to the integration among our
services and the flexibility that enables our clients to purchase components or the comprehensive package. These
solutions take various forms, including data, statistical models, or tailored analytics, all designed to allow our
clients to make more logical decisions. We believe our solutions for analyzing risk positively impact our clients’
revenues and help them better manage their costs.
Executive Summary
Key Performance Metrics
Revenue growth. We use year-over-year revenue growth as a key performance metric. We assess revenue
growth based on our ability to generate increased revenue through increased sales to existing customers, sales to
new customers, sales of new or expanded solutions to existing and new customers, and strategic acquisitions of
new businesses.
We use year-over-year EBITDA growth as metrics to measure our performance. EBITDA and EBITDA
margin are non-GAAP financial measures. EBITDA is defined as net income before interest expense, provision
for income taxes, and depreciation and amortization of fixed and intangible assets. We calculate EBITDA margin
as EBITDA divided by revenues. The respective nearest applicable GAAP financial measures are net income and
net income margin. Although EBITDA is a non-GAAP financial measure, EBITDA is frequently used by
securities analysts, lenders, and others in their evaluation of companies; EBITDA has limitations as an analytical
tool, and should not be considered in isolation, or as a substitute for an analysis of our operating income, net
income, or cash flow from operating activities reported under GAAP. Management uses EBITDA and EBITDA
margin in conjunction with traditional GAAP operating performance measures as part of its overall assessment
company performance. We believe these measures are useful and meaningful because they help us allocate
resources, make business decisions, allow for greater transparency regarding our operating performance, and
facilitate period-to-period comparisons. Some of these limitations involved in the use of EBITDA are:
• EBITDA does not reflect our cash expenditures, or future requirements for capital expenditures or
contractual commitments.
• EBITDA does not reflect changes in, or cash requirements for, our working capital needs.
• Although depreciation and amortization are non-cash charges, the assets being depreciated and
amortized often will have to be replaced in the future and EBITDA does not reflect any cash
requirements for such replacements.
• Other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness
as a comparative measure.
EBITDA growth. We use EBITDA growth as a measure of our ability to balance the size of revenue
growth with cost management and investing for future growth. EBITDA growth allows for greater transparency
regarding our operating performance and facilitate period-to-period comparison.
EBITDA margin. We use EBITDA margin as a performance measure to assess segment performance and
scalability of our business. We assess EBITDA margin based on our ability to increase revenues while
controlling expense growth.
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Revenues
We earn revenues through agreements for hosted subscriptions, advisory/consulting services, and for
transactional solutions, recurring and non-recurring. Subscriptions for our solutions are generally paid in advance
of rendering services either quarterly or in full upon commencement of the subscription period, which is usually
for one year and automatically renewed each year. As a result, the timing of our cash flows generally precedes
our recognition of revenues and income and our cash flow from operations tends to be higher in the first quarter
as we receive subscription payments. Examples of these arrangements include subscriptions that allow our
customers to access our standardized coverage language, our claims fraud database, or our actuarial services
throughout the subscription period. In general, we experience minimal revenue seasonality within the business.
Approximately 80% and 81% of the revenues in our Insurance segment for the years ended December 31, 2023
and 2022 were derived from hosted subscriptions through agreements (generally one to five years) for our
solutions, respectively.
We also provide advisory/consulting services, which help our customers get more value out of our
analytics and their subscriptions. In addition, certain of our solutions are paid for by our customers on a
transactional basis, recurring and non-recurring. For example, we have solutions that allow our customers to
access property-specific rating and underwriting information to price a policy on a commercial building, or
compare a P&C insurance or a workers’ compensation claim with information in our databases, or use our repair
cost estimation solutions on a case-by-case basis. For the years ended December 31, 2023 and 2022,
approximately 20% and 19% of our consolidated revenues were derived from providing transactional and
advisory/consulting solutions, respectively.
Principal Operating Costs and Expenses
Personnel expenses are a major component of both our cost of revenues and selling, general and
administrative expenses. Personnel expenses, which represented approximately 57% and 59% of our total
operating expenses (excluding gains/losses related to dispositions) for each of the years ended December 31,
2023 and 2022, respectively, include salaries, benefits, incentive compensation, equity compensation costs, sales
commissions, employment taxes, recruiting costs, and outsourced temporary agency costs.
We assign personnel expenses between two categories, cost of revenues and selling, general and
administrative costs, based on the actual costs associated with each employee. We categorize employees who
maintain our solutions as cost of revenues, and all other personnel, including executive managers, salespeople,
marketing, business development, finance, legal, human resources, and administrative services, as selling,
general and administrative expenses. A significant portion of our other operating costs, such as facilities and
communications, are either captured within cost of revenues or selling, general and administrative expense based
on the nature of the work being performed.
While we expect to grow our headcount over time to take advantage of our market opportunities, we
believe that the economies of scale in our operating model will allow us to grow our personnel expenses at a
lower rate than revenues. Historically, our EBITDA margin has improved because we have been able to increase
revenues without a proportionate corresponding increase in expenses. However, part of our corporate strategy is
to invest in new solutions and new businesses, which may offset margin expansion.
Cost of Revenues. Our cost of revenues consists primarily of personnel expenses. Cost of revenues also
includes the expenses associated with the acquisition and verification of data, the maintenance of our existing
solutions, and the development and enhancement of our next-generation solutions. Our cost of revenues excludes
depreciation and amortization.
37
Selling, General and Administrative Expense. Our selling, general and administrative expense also consists
primarily of personnel costs. A portion of the other operating costs such as facilities, insurance, and communications
are allocated to selling, general and administrative costs based on the nature of the work being performed by the
employee. Our selling, general and administrative expenses exclude depreciation and amortization.
Trends Affecting Our Business
A significant change in P&C insurers’ profitability could affect the demand for our solutions. For
insurers, the keys to profitability include increasing investment income, premium growth and disciplined and
accurate underwriting of risks. Growth in P&C insurers’ direct written premiums has been cyclical, with total
industry premium growth receding from a peak of 14.8% in 2002 to a trough of negative 3.1% in 2009 and
subsequently recovering to 5.1% in 2019. In 2020, industry premium growth declined to 2.3% due to the
COVID-19 pandemic. Direct premium growth accelerated to 9.5% in 2021 and 9.7% in 2022 indicating a
recovery from the pandemic. Based on the most recent results available, direct written premiums continued to
grow in 2023 on comparable level. In 2023, the main economic indicators stabilized, inflation began to fall, and
the federal interest rate increases stopped mid-year. Despite high interest rates in 2023, the annualized yield on
investments (not attributable to cash transfers from outside the P/C industry) was 3.0% as of nine-months 2023,
down from the 3.3% yield for year-end 2022. Both recent results are lower than the historical 15-year average of
3.4%, showing that yields have yet to follow the trend in interest rates.
The trend of high catastrophic losses incurred by insurers that began in 2020, continued into 2023 — a
time during which the estimated sum of losses from events that ISO’s Property Claims Service had classified as
catastrophes remains above the 10- and 20-year averages. The catastrophes of 2020 included Hurricane Laura
and the Midwest derecho, as well as multiple wildfires in the Western states. The most notable events of 2021
included the winter storm in February that left much of Texas without power and Hurricane Ida in August.
Calendar year 2022 was marked by Hurricane Ian in September, the deadliest hurricane to strike Florida since
1935. All three of these hurricanes — Laura, Ida, and Ian — are among the strongest hurricanes to ever make
landfall in the United States. While 2023 did not bring any high-loss large catastrophes, it is worth noting that the
losses incurred by insurers during the tornado season from March to June were record-breaking in the history of
ISO’s Property Claims Service measurements. The upward trend in the number of disasters recorded by ISO’s
Property Claims Service continues in 2023 — the average increase in the number of disasters was 14% over the
last 5 years. In Florida specifically, the high overall claim risk, as evidenced by Ian, combined with the litigious
environment in the state poses an even greater risk to insurers who have faced two consecutive years with
significant net underwriting losses. In California, the Department of Insurance enacted regulations for wildfire
mitigation discounts in rating plans and wildfire risk models in response to an insurance affordability crisis in
wildfire prone areas. We continue to provide the necessary coverages and data and analytics to meet the changing
needs of communities, regulators and insurers as illustrated by these events.
In response to rising inflation, carriers are working to reset pricing to fix loss ratios and improve
profitability. This has slowed their marketing spend for customer acquisition. Until premium pricing adjustments
take effect and profitability improves, carriers are refraining from spending to drive new policy volume, creating
short term impacts on demand and volume for our Marketing Solutions offerings and auto underwriting solutions.
Trends in catastrophe and non-catastrophe losses (such as from weather, climate, casualty, terrorism,
pandemics, and tsunamis) can have an effect on our customers’ profitability, and therefore on their appetite for
buying analytics to help them manage their risks. Any increase or decrease in frequency or severity of these
events over time could lead to an increased or decreased demand for our catastrophe modeling, catastrophe loss
information, and repair cost solutions. Likewise, any structural changes in the reinsurance and related brokerage
industry from alternative capital or newer technologies could affect demand for our products. We also have a
portion of our revenue related to the number of claims processed due to losses, which can be impacted by
seasonal storm activity. The need by our customers to fight insurance fraud — both in claims and at policy
inception — could lead to increased demand for our underwriting and claims solutions.
38
In the life insurance market, carriers are looking to modernize and digitize their core platforms, as well as
offer streamlined underwriting decision-making process to expand the number of policies, which can be offered
more rapidly, and without cumbersome medical tests. Our no-code modular technology stack and advanced
analytics (such as using electronic health records to model mortality and detecting of tobacco use through voice
analysis) enable the digital transformation of our customers’ core infrastructure and automate their decision-
making processes across the policy lifecycle.
Description of Acquisitions
We acquired 13 businesses since January 1, 2021. These acquisitions affect the comparability of our
consolidated results of operations between periods. See a description of our 2023 acquisitions below and
Note 10. Acquisitions to our consolidated financial statements included in this annual report on Form 10-K for
further discussions.
On April 20, 2023, we acquired Krug Sachverständigen GmbH (“Krug”) for a net cash purchase price of
approximately $43.3 million including working capital adjustments, of which $3.8 million represents indemnity
escrows. Krug is a Germany-based motor claims solutions provider and has established an industry-leading
position in the German insurance market through highly digitalized solutions that help insurers and car
manufacturers achieve better and faster customer service, leading to sustainable reductions in costs. The
acquisition expands our claims and casualty offerings across Europe. Krug has become a part of our claims
category within our Insurance segment.
On February 1, 2023, we acquired 100 percent of the stock of Mavera Holding AB (“Mavera”) for a net
cash purchase price of $28.3 million, of which $4.2 million represents indemnity escrows. Mavera, a Sweden-
based InsurTech firm with a regional presence and established customer base for its personal injury claims
management platform, has become a part of the claims category within our Insurance segment. We expect that
Mavera will support our expansion in continental Europe and our continued growth as a technology and analytics
partner to the global insurance industry.
Description of Discontinued Operations
See a description of our 2023 disposition below and within Note 11. Dispositions and Discontinued
Operations to our consolidated financial statements included in this annual report on Form 10-K for further
discussions.
On February 1, 2023, we completed the sale of our Energy business to Planet Jersey Buyer Ltd, an entity
that was formed on behalf of, and is controlled by, The Veritas Capital Fund VIII, L.P. and its affiliated funds
and entities (“Veritas Capital”), for a net cash sale price of $3,066.4 million paid at closing (reflecting a base
purchase price of $3,100.0 million, subject to customary purchase price adjustments for, among other things, the
cash, working capital, and indebtedness of the companies as of the closing) and up to $200.0 million of additional
contingent cash consideration based on Veritas Capital’s future return on its investment paid through a Class C
Partnership interest.
The Energy business, which was part of our Energy and Specialized Markets segment, was classified as
discontinued operations per ASC 205-20 as we determined, qualitatively and quantitatively, that this transaction
represented a strategic shift that had a major effect on our operations and financial results. Accordingly, all
results of the Energy business have been removed from continuing operations and presented as discontinued
operations in our consolidated statements of operations for all periods presented. Additionally, all assets and
liabilities of the Energy business were classified as assets and liabilities held for sale within our consolidated
balance sheet as of December 31, 2022. In connection with the held for sale classification, we recognized an
impairment of $303.7 million on the remeasurement of the disposal group held for sale, which has been included
39
in discontinued operations in our consolidated statement of operations. Upon classification of the Energy
business as held for sale, its cumulative foreign currency translation adjustment within shareholders’ equity
was included with its carrying value, which primarily resulted in the impairment. When we closed on and
completed the sale of our Energy business on February 1, 2023, we recognized a loss of $128.4 million. As a
result of closing adjustments in the second and fourth quarter of 2023, we incurred an additional net loss of
$2.7 million.
Year Ended December 31, 2023 Compared to Year Ended December 31, 2022
Consolidated Results of Continuing Operations
Revenues
Revenues were $2,681.4 million for the year ended December 31, 2023 compared to $2,497.0 million for
the year ended December 31, 2022, an increase of $184.4 million or 7.4%. The growth in our revenues was
partially offset by the sale of 3E and our Financial Services segment, both of which did not qualify as
discontinued operations and as a result, their prior year revenues of $60.0 million were included in our results.
Our recent acquisitions (Morning Data within the underwriting category of our Insurance segment; and Mavera
and Krug within the claims category of the Insurance segment increased net revenues by $32.4 million. The
remaining growth in revenues of $212.0 million or 8.7% is related to increased revenues within our Insurance
segment. Refer to the Results of Operations by Segment within this section for more information regarding our
revenues. Our Specialized Market business was sold in March 2022; and our Energy business, which qualified
for discontinued operations in the fourth quarter of 2022, was subsequently sold in February 2023. Our Financial
Services segment was sold in April 2022. Our Energy and Specialized Markets and Financial Services segments
did not have revenues from continuing operations in 2023.
2023
2022
Percentage change
(in millions)
Percentage change
excluding recent
acquisitions, businesses
held for sale and
disposition
Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Specialized Markets . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services . . . . . . . . . . . . . . . . . . . . . . . . .
$2,681.4
—
—
$2,437.0
22.4
37.6
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,681.4
$2,497.0
10.0%
N/A
N/A
7.4%
8.7%
N/A
N/A
8.7%
Cost of Revenues
Cost of revenues was $876.5 million for the year ended December 31, 2023 compared to $824.6 million
for the year ended December 31, 2022, an increase of $51.9 million or 6.3%. Our recent acquisitions and
dispositions accounted for a net decrease of $16.5 million in cost of revenues, which was primarily related to
salaries and employee benefits. The cost of revenues increase of $68.4 million or 8.7% was primarily due to
increases in salaries and employee benefits of $51.0 million, rent expense of $6.6 million, bad debt expense of
$3.8 million, travel expenses of $3.6 million, data costs of $1.8 million, and other operating costs of
$3.9 million. These increases were partially offset by decreases in information technology expenses of
$2.1 million and professional consulting fees $0.2 million.
Selling, General and Administrative Expenses
Selling, general and administrative expenses (“SGA”) were $391.8 million for the year ended
December 31, 2023 compared to $381.5 million for the year ended December 31, 2022, an increase of
$10.3 million or 2.7%. Our recent acquisitions, primarily related to salaries and benefits of $24.5 million,
contributed to the increase, offset by our recent dispositions and acquisition-related earn out costs, which
40
accounted for decreases of $34.1 million and $16.5 million, respectively. The remaining SGA increase
of $36.4 million or 10.0% was primarily due to a litigation reserve expense of $38.2 million associated with an
indemnification of an ongoing inquiry related to our former Financial Services segment, increases in travel
expenses of $3.9 million, professional consulting fees (mostly related to ERP costs) of $3.4 million, information
technology expenses of $0.6 million, and other operating costs of $0.9 million, partially offset by a decrease in
salaries and employee benefits of $10.6 million.
Depreciation and Amortization of Fixed Assets
Depreciation and amortization of fixed assets was $206.8 million for the year ended December 31, 2023
compared to $164.2 million for the year ended December 31, 2022, an increase of $42.6 million or 25.9%. The
increase was primarily driven by $44.6 million of depreciation and amortization expense attributed to an increase
in assets placed into service to support revenue growth and recent acquisitions of $0.2 million, partially offset
by $2.2 million related to recent dispositions. The increase in assets placed into service in 2023 primarily resulted
from the timing of certain large internally developed software projects that were completed and placed into
service during the year.
Amortization of Intangible Assets
Amortization of intangible assets was $74.6 million for the year ended December 31, 2023 compared
to $74.4 million for the year ended December 31, 2022, an increase of $0.2 million or 0.3%. The increase was
primarily driven by recent acquisitions of $3.7 million, partially offset by our recent dispositions of $3.5 million.
Other Operating Income
Other operating income was $0.0 million for the year ended December 31, 2023 compared to
$354.2 million for the year ended December 31, 2022. The gain in the prior year was primarily driven by the sale
of 3E and Financial Services segment recognized in the prior year.
Investment Income (Loss) and Others, Net
Investment income (loss) and others, net was a gain of $11.0 million for the year ended December 31,
2023 compared to a loss of $5.3 million for the year ended December 31, 2022. The increase was primarily due
to impact of foreign currencies.
Interest Expense, net
Interest expense was $115.5 million for the year ended December 31, 2023 compared to $138.8 million
for the year ended December 31, 2022, a decrease of $23.3 million or 16.8%. The decrease in interest expense
was primarily due to the paydown in the current year of our outstanding borrowings on our Syndicated Revolving
and Bilateral credit facilities, and an increase in interest income of $15.8 million, partially offset by interest
expense related to the issuance of our 2033 Senior Notes.
Provision for Income Taxes
The provision for income taxes was $258.8 million for the year ended December 31, 2023 compared to
$220.3 million for the year ended December 31, 2022. The effective tax rate was 25.2% for the year ended
December 31, 2023 compared to 17.5% for the year ended December 31, 2022. The increase in the effective tax
rate in 2023 compared to 2022 was primarily due to tax rate benefits in 2022 related to the sale of 3E and a
release of a United Kingdom valuation allowance associated with interest expense utilization. In addition, the tax
rate for 2023 was higher than the prior year due to tax charges incurred in structuring the Energy sale in the first
quarter and the unfavorable impact of the litigation reserve expense, described above, that is anticipated to be
mostly non-deductible.
41
Net Income Margin
The net income margin for our consolidated results was 22.9% for the year ended December 31,
2023 compared to 38.2% for the year ended December 31, 2022. The decrease in net income margin was
primarily driven by the net gain from dispositions in the prior year, as well as the current year litigation reserve
expense described above.
EBITDA Margin [1]
The EBITDA margin for our consolidated results was 53.1% for the year ended December 31, 2023
compared to 65.7% for the year ended December 31, 2022. The decrease in EBITDA margin was primarily
related to dispositions in the prior year, as well as the current year litigation reserve expense described above.
[1] Note: Consolidated EBITDA margin, a non-GAAP measure, is calculated as a percentage of consolidated
revenue. A reconciliation from net income to EBITDA is in the table below:
Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Loss from discontinued operations, net of tax (benefit) expense of $(12.6) and
Year Ended December 31,
2023
2022
$
614.4
$
954.3
$131.5, respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(154.0)
(87.8)
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
768.4
206.8
74.6
115.5
258.8
EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
1,424.1
2,681.4
$
$
1,042.1
164.2
74.4
138.8
220.3
1,639.8
2,497.0
EBITDA Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
53.1%
65.7%
Results of Continuing Operations by Segment
Insurance
Revenues
Revenues were $2,681.4 million for the year ended December 31, 2023 compared to $2,437.0 million for
the year ended December 31, 2022, an increase of $244.4 million or 10.0%. Our underwriting revenues increased
$158.2 million or 9.1%. Our claims revenues increased $86.2 million or 12.3%.
2023
2022
Percentage change
(in millions)
Percentage change
excluding recent
acquisitions, businesses
held for sale and
disposition
Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,892.7
788.7
$1,734.5
702.5
Total Insurance . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,681.4
$2,437.0
9.1%
12.3%
10.0%
8.5%
9.3%
8.7%
Our recent acquisitions (Morning Data within the underwriting category of our Insurance segment; and
Mavera and Krug within the claims category of the Insurance segment) contributed net revenues of
$32.4 million, while the remaining Insurance revenues increased $212.0 million or 8.7%. Our underwriting
42
revenues increased $146.6 million or 8.5% primarily due to an annual increase in prices derived from continued
enhancements to the content of the solutions within our forms, rules and loss cost services as well as selling
expanded solutions to new and existing customers within underwriting solutions. In addition, extreme events, life
insurance, and specialty business solutions contributed to the growth. Our claims revenues increased
$65.4 million or 9.3%, primarily due to growth in property estimating solutions and anti-fraud solutions.
Cost of Revenues
Cost of revenues for our Insurance segment was $876.5 million for the year ended December 31, 2023
compared to $781.9 million for the year ended December 31, 2022, an increase of $94.6 million or 12.1%. Our
recent acquisitions and dispositions represented a net increase of $26.2 million in cost of revenues, which was
primarily related to salaries and employee benefits. The remaining increase in cost of revenues of $68.4 million
or 8.7% was primarily due to increases in salaries and employee benefits of $51.0 million, which was primarily
driven by increase in rent expenses of $6.6 million, bad debt expenses of $3.8 million, travel expenses of
$3.6 million, data costs of $1.8 million, and other operating costs of $3.9. These increases were partially offset by
decreases in information technology expenses of $2.1 million and professional consulting fees of $0.2 million.
Selling, General and Administrative Expenses
SGA expenses for our Insurance segment were $391.8 million for the year ended December 31, 2023
compared to $347.4 million for the year ended December 31, 2022, an increase of $44.4 million or 12.8%. Our
recent acquisitions and dispositions accounted for an increase of $24.5 million primarily related to salaries and
employee benefits, partially offset by acquisition-related earn-out costs of $16.5 million. The remaining
increase in SGA of $36.4 million or 10.0% was primarily due to a litigation reserve expense of $38.2 million
associated with an indemnification of an ongoing inquiry related to our former Financial Services segment,
increases in travel expenses of $3.9 million, professional consulting fees (mostly related to ERP costs) of
$3.4 million, information technology expenses of $0.6 million, and other operating costs of $0.9 million, partially
offset by a decrease in salaries and employee benefits of $10.6 million.
Investment Income (Loss) and Others, Net
Investment income (loss) and others, net was a gain of $11.0 million for the year ended December 31,
2023 compared to a loss of $4.7 million for the year ended December 31, 2022. The increase was primarily due
to impact of foreign currencies.
EBITDA
EBITDA for our Insurance segment was $1,424.1 million for the year ended December 31, 2023
compared to $1,303.0 million for the year ended December 31, 2022. The EBITDA margin for our Insurance
segment was 53.1% for the year ended December 31, 2023 compared to 53.5% for the year ended December 31,
2022.
Energy and Specializes Markets and Financial Segments
On March 11, 2022, we completed the sale of 3E, which made up the Specialized Markets within this
segment. On February 1, 2023, we completed the sale of our Energy business.
On April 8, 2022, we completed the sale of our Financial Services segment.
As a result of these sale transactions, we have excluded the Energy and Specialized Markets and Financial
Services segments from our management’s discussion and analysis of the results of operations by segment.
43
Year Ended December 31, 2022 Compared to Year Ended December 31, 2021
Consolidated Results of Continuing Operations
Revenues
Revenues were $2,497.0 million for the year ended December 31, 2022 compared to $2,462.5 million for
the year ended December 31, 2021, an increase of $34.5 million or 1.4%. Our recent acquisitions (Data Driven
Safety, LLC, Infutor Data Solutions, LLC, and Opta Information Intelligence Corp. within the underwriting
category of the Insurance segment, ACTINEO GmbH, Automated Insurance Solutions Ltd. and Pruvan Inc.,
within the claims category of the Insurance segment) and dispositions (the Specialized Markets segment and the
Financial Services segment) reduced net revenues by $93.8 million. The remaining growth in consolidated
revenues of $128.3 million or 5.8% is related to increased revenues within our Insurance segment. Refer to the
Results of Operations by Segment within this section for more information regarding our revenues.
2022
2021
Percentage change
(in millions)
Percentage change
excluding recent
acquisitions, businesses
held for sale and
disposition
Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Specialized Markets . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services . . . . . . . . . . . . . . . . . . . . . . . . .
$2,437.0
22.4
37.6
$2,206.9
112.8
142.8
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,497.0
$2,462.5
10.4%
(80.1)%
(73.7)%
1.4%
5.8%
—%
—%
5.8%
Cost of Revenue
Cost of revenues was $824.6 million for the year ended December 31, 2022 compared to $853.7 million
for the year ended December 31, 2021, a decrease of $29.1 million or 3.4%. Our recent acquisitions and
dispositions accounted for a net decrease of $54.9 million in cost of revenues, which was primarily related to
salaries and employee benefits. The remaining cost of revenues of $25.8 million or 3.6% was primarily due to
increases in salaries and employee benefits of $15.0 million, information technology expenses of $13.6 million
and travel expenses of $3.5 million. These increases were partially offset by decreases in data costs of
$4.7 million, professional consulting fees of $0.9 million and other operating cost of $0.7 million.
Selling, General and Administrative Expenses
SGA were $381.5 million for the year ended December 31, 2022 compared to $313.2 million for the year
ended December 31, 2021, an increase of $68.3 million or 21.8%. Our recent acquisitions and dispositions
accounted for an increase of $13.7 million in SGA primarily related to salaries and employee benefits. Our
acquisition-related costs (earn-outs) accounted for a decrease of $3.6 million (See Note 10. Acquisitions to our
consolidated financial statements included in this annual report on Form 10-K). The remaining SGA increase
of $58.2 million or 21.3% was primarily due to increases in professional consulting costs of $49.2 million, travel
expenses of $4.6 million, salaries and employee benefits of $4.2 million and information technology expenses of
$0.4 million. The increase in professional consulting costs is primarily due to the release of the previously
established Xactware Solutions Patent Litigation’s (“EVT Litigation Reserve”) reserve once the final payment
was made in the fourth quarter of 2021 (the original accrual for this matter was recorded as part of SGA). These
increases were partially offset by decreases of other operating costs of $0.2 million.
44
Depreciation and Amortization of Fixed Assets
Depreciation and amortization of fixed assets was $164.2 million for the year ended December 31,
2022 compared to $170.3 million for the year ended December 31, 2021, a decrease of $6.1 million or 3.6%. The
decrease was primarily driven by recent dispositions of $20.5 million, partially offset by $13.1 million attributed
to assets placed into service to support data capacity expansion and revenue growth and $1.3 million related to
recent acquisitions.
Amortization of Intangible Assets
Amortization of intangible assets was $74.4 million for the year ended December 31, 2022 compared to
$79.9 million for the year ended December 31, 2021, a decrease of $5.5 million or 6.9%. The decrease was
primarily driven by recent dispositions of $20.1 million, and intangible assets that were fully
amortized of $8.6 million, partially offset by additional amortization of intangible assets incurred in connection
with our recent acquisitions of $23.2 million.
Other Operating (Income) Loss
Other operating (income) loss was a gain of $354.2 million for the year ended December 31,
2022 compared to a loss of $134.0 million for the year ended December 31, 2021. This increase of
$488.2 million was primarily related to the net gain from our dispositions within our former Energy and
Specialized Markets and Verisk Financial Services segments.
Investment (Loss) Income and Others, Net
Investment (loss) income and others, net was a loss of $5.3 million for the year ended December 31,
2022 compared to a gain of $2.1 million for the year ended December 31, 2021. The decrease was primarily due
to impact of foreign currencies.
Interest Expense, net
Interest expense was $138.8 million for the year ended December 31, 2022 compared to $127.0 million
for the year ended December 31, 2021, an increase of $11.8 million or 9.3%. The increase in interest expense
was primarily due to increased borrowings and higher interest rates on our Syndicated Credit Facility, and the
addition of a Bilateral Term Loan Credit Facility during the first quarter of 2022, partially offset by the maturity
of our 4.125% senior notes.
Provision for Income Taxes
The provision for income taxes was $220.3 million for the year ended December 31, 2022 compared to
$179.4 million for the year ended December 31, 2021, an increase of $40.9 million or 22.8%. The effective tax
rate was 17.5% for the year ended December 31, 2022 compared to 22.8% for the year ended December 31,
2021. The decrease in the effective tax rate in 2022 compared to 2021 was primarily due to a tax rate benefit in
connection with the sale of 3E for which a benefit was recognized for the difference between book and tax basis
of our investment. The 2022 rate was also lower than 2021 due to a $30.3 million release of a United Kingdom
valuation allowance related to interest expense utilization and a reduced Global Intangible Low Taxed Income
(“GILTI”) inclusion in the current period versus the prior period, partially offset by reduced stock option
exercises resulting in lower tax benefits from equity compensation in the current period versus the prior period.
45
Net Income Margin
The net income margin for our consolidated results was 41.7% for the year ended December 31,
2022 compared to 24.7% for the year ended December 31, 2021. The increase in net income margin was
primarily related to the net gain from the sale of 3E and the Financial Services segment in addition to an
impairment of our Financial Services segment in 2021.
EBITDA Margin [1]
The EBITDA margin for our consolidated results was 65.7% for the year ended December 31,
2022 compared to 47.3% for the year ended December 31, 2021. The increase in EBITDA margin was primarily
related to the net gain from our dispositions within our former Energy and Specialized Markets and Verisk
Financial Services segments. The net gain from the sale of 3E and the Financial Services segment, which
positively impacted our margin by 14.2%.
[1] Note: Consolidated EBITDA margin, a non-GAAP measure, is calculated as a percentage of consolidated
revenue. A reconciliation from net income to EBITDA is in the table below:
Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: (Loss) income from discontinued operations, net of tax expense of $131.5 and
Year Ended December 31,
2022
2021
$ 954.3
$ 666.3
$(29.7), respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(87.8)
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization of fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,042.1
164.2
74.4
138.8
220.3
59.2
607.1
170.3
79.9
127.0
179.4
EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,639.8
$2,497.0
$1,163.7
$2,462.5
EBITDA Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
65.7%
47.3%
Results of Continuing Operations by Segment
As previously described in our “Results of Continuing Operations by Segment, for year ended December
31, 2023 compared to year ended December 31, 2022, we have excluded Energy and Specialized Markets
segment and Financial Services segment from the results of operations by segment due to the sale of these two
segments. See a description of our 2023 dispositions and businesses held for sale below and Note 11.
Dispositions and Discontinued Operations to our consolidated financial statements included in this annual report
on Form 10-K for further discussions.
46
Insurance
Revenues
Revenues were $2,437.0 million for the year ended December 31, 2022 compared to $2,206.9 million for
the year ended December 31, 2021, an increase of $230.1 million or 10.4%. Our underwriting revenues increased
$179.4 million or 11.5%. Our claims revenues increased $50.7 million or 7.8%.
2022
2021
Percentage change
(in millions)
Percentage change
excluding recent
acquisitions, businesses
held for sale and
disposition
Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,734.5
702.5
$1,555.1
651.8
Total Insurance . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,437.0
$2,206.9
11.5%
7.8%
10.4%
5.9%
5.6%
5.8%
Our recent acquisitions (Data Driven Safety, LLC, Infutor Data Solutions, LLC, and Opta Information
Intelligence Corp. within the underwriting category of the Insurance segment, ACTINEO GmbH, Automated
Insurance Solutions Ltd. and Pruvan Inc., within the claims category of the Insurance Segment) contributed net
revenues of $101.8 million, while the remaining Insurance revenues increased $128.3 million or 5.8%. Our
underwriting revenues increased $91.8 million or 5.9% primarily due to an annual increase in prices derived from
continued enhancements to the content of the solutions within our industry-standard insurance programs as well
as selling expanded solutions to existing customers within commercial and personal lines. In addition,
catastrophe modeling services contributed to the growth. Our claims revenues increased $36.5 million or 5.6%,
primarily due to growth in our repair cost estimating solutions revenue and claims analytics revenue related to
annual price as well as volume increases.
Cost of Revenues
Cost of revenues for our Insurance segment was $781.9 million for the year ended December 31,
2022 compared to $704.4 million for the year ended December 31, 2021, an increase of $77.5 million or 11.0%.
Our recent acquisitions and dispositions represented a net increase of $51.7 million in cost of revenues, which
was primarily related to salaries and employee benefits. The remaining increase in cost of revenues of
$25.8 million or 3.6% was primarily due to increases in salaries and employee benefits of $15.0 million,
information technology expenses of $13.6 million, and travel expenses of $3.5 million. These increases were
partially offset by decreases in data costs of $4.7 million, professional consulting fees of $0.9 million, and other
operating cost of $0.7 million.
Selling, General and Administrative Expenses
SGA expenses for our Insurance segment were $347.4 million for the year ended December 31,
2022 compared to $239.1 million for the year ended December 31, 2021, an increase of $108.3 million or 45.3%.
Our recent acquisitions and dispositions accounted for an increase of $53.7 million primarily related to salaries
and employee benefits. Our acquisition-related costs (earn-outs) accounted for a decrease of $3.6 million. The
remaining increase in SGA of $58.2 million or 21.3% was primarily due to increases in professional consulting
costs of $49.2 million, travel expenses of $4.6 million, salaries and employee benefits of $4.2 million and
information technology expenses of $0.4 million. This increase in professional consulting costs is primarily due
to the release of the previously established EVT Litigation Reserve once the final payment was made in the
fourth quarter of 2021 (the original accrual for this matter was recorded as part of SGA). These increases were
partially offset by decreases of other operating costs of $0.2 million.
47
Investment (Loss) Income and Others, Net
Investment (loss) income and others, net was a loss of $4.7 million for the year ended December 31,
2022 compared to a gain of $1.8 million for the year ended December 31, 2021. The decrease was primarily due
to impact of foreign currencies.
EBITDA
EBITDA for our Insurance segment was $1,303.0 million for the year ended December 31, 2022
compared to $1,265.2 million for the year ended December 31, 2021. The EBITDA margin for our Insurance
segment was 53.5% for the year ended December 31, 2022 compared to 57.3% for the year ended December 31,
2021. The decrease in EBITDA was primarily due to the release of the previously established EVT Litigation
Reserve once the final payment was made in the fourth quarter of 2021.
Energy and Specialized Markets and Financial Segments
On March 11, 2022, we completed the sale of 3E, which made up the Specialized Markets within this
segment. This transaction did not qualify as discontinued operations per the guidance in ASC 205-20. The
Energy business within the “Energy and Specialized Markets” segment was classified as discontinued operations
per the guidance in ASC 205-20. Accordingly, all results of the Energy business have been removed from
continuing operations and presented as discontinued operations in our consolidated statements of operations for
all periods presented. On February 1, 2023, we completed the sale of our Energy business.
On April 8, 2022, we completed the sale of Verisk Financial Services, our Financial Services segment, to
TransUnion. We did not classify this transaction as a discontinued operation.
As a result of these sale transactions, we have excluded the Energy and Specialized Markets and Financial
Services segments from our management’s discussion and analysis of the results of operations by segment.
Quarterly Results of Operations
The following table set forth our quarterly unaudited consolidated statement of operations data for each of
the eight quarters in the period ended December 31, 2023. In management’s opinion, the quarterly data has been
prepared on the same basis as the audited consolidated financial statements and includes all adjustments
necessary to state fairly the information for the periods presented. Our Energy business is classified as
discontinued operations.
March 31,
June 30,
September 30, December 31,
2023
(in millions, except for per share data)
Statement of operations data:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
Net Income attributable to Verisk . . . . . . . . . . . . . . . . . . . . . . . .
Basic earnings per share:
$651.6
216.2
294.1
194.4
56.3
$675.0
216.9
306.0
204.3
196.9
Income from continuing operations . . . . . . . . . . . . . . . . . . .
Net income attributable to Verisk . . . . . . . . . . . . . . . . . . . .
$ 1.28
$ 0.37
$ 1.41
$ 1.36
Diluted earnings per share:
Income from continuing operations . . . . . . . . . . . . . . . . . . .
Net income attributable to Verisk . . . . . . . . . . . . . . . . . . . .
$ 1.27
$ 0.37
$ 1.41
$ 1.35
$677.6
217.2
281.1
187.4
187.4
$ 1.29
$ 1.29
$ 1.29
$ 1.29
$677.2
226.2
250.5
182.3
174.0
$ 1.26
$ 1.20
$ 1.25
$ 1.20
48
March 31,
June 30,
September 30, December 31,
2022
(in millions, except for per share data)
Statement of operations data:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to Verisk . . . . . . . . . . . . . . . . . . . . . . . .
Basic earnings per share:
$643.6
228.7
622.8
487.0
505.7
$612.9
195.5
247.6
173.5
197.6
Income from continuing operations . . . . . . . . . . . . . . . . . . .
Net income attributable to Verisk . . . . . . . . . . . . . . . . . . . .
$ 3.03
$ 3.15
$ 1.10
$ 1.25
Diluted earnings per share:
Income from continuing operations . . . . . . . . . . . . . . . . . . .
Net income attributable to Verisk . . . . . . . . . . . . . . . . . . . .
$ 3.01
$ 3.13
$ 1.09
$ 1.24
$610.1
195.2
253.6
165.8
189.4
$ 1.06
$ 1.21
$ 1.05
$ 1.20
$630.4
205.2
282.5
215.8
61.2
$ 1.38
$ 0.39
$ 1.37
$ 0.39
Liquidity and Capital Resources
As of December 31, 2023 and 2022, we had cash and cash equivalents and available-for-sale securities
totaling $303.9 million and $296.7 million, respectively, inclusive of cash included within assets held for sale.
Subscriptions for our solutions are billed and generally paid in advance of rendering services either quarterly or
in full upon commencement of the subscription period, which is usually for one year. Subscriptions are
automatically renewed at the beginning of each calendar year. We have historically generated significant cash
flows from operations. As a result of this factor, as well as the availability of funds under our Syndicated Credit
Facility (as defined below), we believe we will have sufficient cash to meet our working capital, human
capital and capital expenditure needs, and to fuel our future growth plans.
We have historically managed the business with a working capital deficit due to the fact that, as described
above, we offer our solutions and services primarily through annual subscriptions or long-term contracts, which
are generally prepaid quarterly or annually in advance of the services being rendered. When cash is received for
prepayment of invoices, we record an asset (cash and cash equivalents) on our balance sheet with the offset
recorded as a current liability (deferred revenues). This current liability is deferred revenue that does not require
a direct cash outflow since our customers have prepaid and are obligated to purchase the services. In most
businesses, growth in revenue typically leads to an increase in the accounts receivable balance causing a use of
cash as a company grows. Unlike these businesses, our cash position is favorably affected by revenue growth,
which results in a source of cash due to our customers prepaying for most of our services.
Our capital expenditures for the years ended December 31, 2023 and 2022 were $230.0 million and
$274.7 million, respectively. Expenditures related to developing and enhancing our solutions are predominately
related to internal-use software and are capitalized in accordance with ASC 350-40, Accounting for Costs of
Computer Software Developed or Obtained for Internal Use. We also capitalize amounts in accordance with
ASC 985-20, Software to be Sold, Leased or Otherwise Marketed.
We have historically used a portion of our cash for repurchases of our common stock from our
stockholders. For the years ended December 31, 2023, 2022, and 2021, we repurchased $2,762.3 million,
$1,662.5 million, and $475.0 million, respectively, of our common stock. For the years ended December 31,
2023, 2022, and 2021, we also paid dividends of $196.8 million, $195.2 million, and $188.2 million,
respectively.
49
Financing and Financing Capacity
We had total debt, excluding finance lease obligations, unamortized discounts and premium, and debt
issuance costs, of $2,850.0 million and $3,740.0 million at December 31, 2023 and 2022, respectively. The debt
at December 31, 2023 primarily consists of senior notes issued in 2023, 2020, 2019, and 2015. Interest on the
senior notes is payable semi-annually each year. The unamortized discount and debt issuance costs were recorded
as “Long-term debt” in the accompanying consolidated balance sheets, and will be amortized to “Interest
expense” in the accompanying consolidated statements of operations within this Form 10-K over the life of the
respective senior note. The indenture governing the senior notes restricts our ability to, among other things,
create certain liens, enter into sale/leaseback transactions, and consolidate with, sell, lease, convey, or otherwise
transfer all or substantially all of our assets, or merge with or into, any other person or entity. We have made, and
may from time to time in the future make, optional repayments on our debt obligations, which may include
repurchases or exchanges of our outstanding notes, depending on various factors, such as market conditions. Any
such repurchases may be effected through privately negotiated transactions, market transactions, tender offers,
redemptions or otherwise. See Note 15 for additional information on our financing activities.
We have a $1,000.0 million Syndicated Credit Facility with Bank of America N.A., HSBC Bank USA,
N.A., JP Morgan Chase Bank, N.A., Wells Fargo Bank, National Association, Citibank, N.A., Morgan Stanley
Bank, N.A., TD Bank, N.A., Goldman Sachs Bank USA, and the Northern Trust Company that was amended on
April 5, 2023. The amendment does not change the current borrowing capacity of $1,000.0 million, but does
extend the maturity date to April 5, 2028. Borrowing under the Amendment is payable at an interest rate of
SOFR plus 100.0 to 162.5 basis points, depending on the public debt rating. The financial covenants require that,
at the end of any fiscal quarter, we have a consolidated funded debt leverage ratio of less than 3.75 to 1.0. At
our election, the maximum consolidated funded debt leverage ratio could be permitted to increase to 4.50 to
1.0 (no more than once) and to 4.25 to 1.0 (no more than once) in connection with the closing of a permitted
acquisition. The Syndicated Credit Facility may be used for general corporate purposes, including working
capital needs and capital expenditures, acquisitions, dividend payments, and the Repurchase Program. As of
December 31, 2023, we were in compliance with all financial and other debt covenants under the Syndicated
Credit Facility. As of December 31, 2023 and December 31, 2022, the available capacity under the Syndicated
Revolving Credit Facility was $995.4 and $5.6 million, which takes into account outstanding letters of credit of
$4.6 and $4.4 million, respectively.
We also maintained a $125.0 million Bilateral Term Loan Facility and a $275.0 million Bilateral
Revolving Credit Facility (together the “Bilateral Credit Facilities”) that matured on September 9,
2023 and October 2, 2023, respectively. The Bilateral Credit Facilities carried an interest rate of 135 basis points
plus the one-month BSBY were used for general corporate purposes, including working capital needs and capital
expenditures, acquisitions, dividend payments, and the Repurchase Program. We have had no outstanding
borrowings under our Bilateral Credit Facilities during 2023 through the maturity dates. The Bilateral Credit
Facilities have not been renewed.
Cash Flow
The following table summarizes our cash flow data for the years ended December 31:
Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash provided by (used in) investing activities . . . . . . . . . . . . . . . . . . . . . .
Net cash used in financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023
2022
2021
(in millions)
$ 1,059.0
301.4
$
$ 1,060.7
$1,155.7
$ (592.0)
$ 2,746.5
$(3,786.5) $(1,330.2) $ (498.9)
50
Operating Activities
Net cash provided by operating activities was $1,060.7 million for the year ended December 31,
2023 compared to $1,059.0 million for the year ended December 31, 2022, an increase of $1.7 million, or
0.2%.The increase in net cash provided by operating activities reflects an increase in the operating profit of our
Insurance segment and lower tax payments in the current year, offset by the disposition of our Energy business in
February 2023. Cash taxes paid in the prior year were higher primarily due to the gain on the sale of 3E.
Net cash provided by operating activities was $1,059.0 million for the year ended December 31,
2022 compared to $1,155.7 million for the year ended December 31, 2021, a decrease of $96.7 million, or
8.4%. The decrease is primarily related to the sale of 3E and Financial Services segment, as well as an increase in
tax payments of $310.8 million primarily due to the gain on the sale of 3E, partially offset by an impairment
related to the Financial Services segment and the Energy business of $243.4 million and the prior year settlement
of our EVT litigation reserve of $75.0 million.
Investing Activities
Net cash provided by investing activities of $2,746.5 million for the year ended December 31, 2023 was
primarily related to proceeds from the sale of our Energy business of $3,066.4 million, partially offset by capital
expenditures of $230.0 million, and acquisitions, including escrow funding of $87.1 million.
Net cash used in investing activities of $301.4 million for the year ended December 31, 2022 was
primarily related to the $1,073.3 million in proceeds from the sale of 3E and our Financial Services segment,
partially offset by acquisitions and purchase of non-controlling interest, including escrow funding associated with
these acquisitions, of $451.2 million, capital expenditures of $274.7 million, and investments in nonpublic
companies of $46.0 million.
Net cash used in investing activities of $592.0 million for the year ended December 31, 2021 was
primarily related to acquisitions, including escrow funding, of $299.0 million, capital expenditures of
$268.4 million, and investments in nonpublic companies of $23.6 million.
Financing Activities
Net cash used in financing activities of $3,786.5 million for the year ended December 31, 2023 was
primarily driven by the funding of $2,799.8 million in share repurchases, repayments of debt under our revolving
credit and bilateral credit facilities of $1,265.0 million, and dividend payments of $196.8 million, partially offset
by the proceeds from the issuance of our 2033 Senior Notes of $495.2 million, and proceeds from stock options
exercised of $141.9 million.
Net cash used in financing activities of $1,330.2 million for the year ended December 31, 2022 was
primarily related to repurchases of common stock of $1,662.5 million, repayment of our $350.0 million 4.125%
senior notes on September 12, 2022, and dividend payments of $195.2 million, partially offset by proceeds under
our Bilateral Term Loan Credit Facility of $125.0 million, proceeds from our Bilateral Revolving Credit Facility
of $275.0 million, proceeds, net of repayments of debt under our Syndicated Credit Facility, of $380.0,
million and proceeds from stock options exercised of $132.5 million.
Net cash used in financing activities of $498.9 million for the year ended December 31, 2021 was
primarily related to repurchases of common stock of $475.0 million, repayment of our $450.0 million 5.800%
senior notes on May 3, 2021, and dividend payments of $188.2 million, partially offset by proceeds, net of
repayments, from our Syndicated Credit Facility, of $560.0 million and proceeds from stock options exercised of
$84.3 million.
51
Contractual Obligations
The following table summarizes our contractual obligations at December 31, 2023 and the future periods
in which such obligations are expected to be settled in cash:
Payments Due by Period
Total
Less than
1 year
2-3 years
4-5 years
(in millions)
More than
5 years
Contractual obligations
Long-term debt, current portion of long-term debt, and
interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension and postretirement plans(1) . . . . . . . . . . . . . . . . . . .
Finance lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . .
$4,191.0
268.4
12.4
37.1
$126.9
33.3
1.7
15.6
$1,098.3
66.7
2.9
17.2
$181.8
64.1
2.6
4.3
$2,784.0
104.3
5.2
—
Total(2)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$4,508.9
$177.5
$1,185.1
$252.8
$2,893.5
(1) Our funding policy is to contribute at least equal to the minimum legal funding requirement.
(2) Unrecognized tax benefits of approximately $2.0 million have been recorded as liabilities in accordance
with ASC 740, Income Taxes which have been omitted from the table above, and we are uncertain as to if or
when such amounts may be settled, with the exception of those amounts subject to a statute of limitation.
Related to the unrecognized tax benefits, we also have recorded a liability for potential penalties and interest
of $0.2 million.
Off-Balance Sheet Arrangements
We have no off-balance sheet arrangements.
Critical Accounting Policies and Estimates
Our management’s discussion and analysis of financial condition and results of operations are based on
our consolidated financial statements, which have been prepared in accordance with accounting principles
generally accepted in the United States. The preparation of these financial statements require management to
make estimates and judgments that affect reported amounts of assets and liabilities and related disclosures of
contingent assets and liabilities at the dates of the financial statements and revenue and expenses during the
reporting periods. These estimates are based on historical experience and on other assumptions that are believed
to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, including
those related to revenue recognition, goodwill and intangible assets, pension and other postretirement benefits,
stock-based compensation, and income taxes. Actual results may differ from these assumptions or conditions.
Revenue Recognition
We recognize revenue based on the transfer of promised goods or services to customers for the amount
that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Revenue
is recognized in a five-step model: 1) identify the contract with a customer; 2) identify the performance
obligations in the contract; 3) determine the transaction price; 4) allocate the transaction price to the performance
obligations in the contract; and 5) recognize revenue when or as we satisfy a performance obligation. Revenues
for hosted subscription services are recognized ratably over the subscription term. Revenues from certain discrete
project based advisory/consulting services are recognized over time by measuring the progress toward complete
satisfaction of the performance obligation, based on the input method of consulting hours worked; this aligns
with the results achieved and value transferred to the customer. Revenues from transactional solutions are
recognized as the solutions are delivered or services performed at point in time.
52
We invoice our customers in annual, quarterly, or monthly installments. Amounts billed and collected in
advance are recorded as deferred revenues on the balance sheet and are recognized as the services are performed
and revenue recognition criteria are met.
Stock-Based Compensation
Stock-based compensation cost, including nonqualified stock options, restricted stock, TSR-based
performance share units (“PSUs”), and ROIC-based PSUs, is measured at the grant date, based on the fair value
of the awards granted, and is recognized as expense over the requisite service period. The fair value of stock
options is measured using a Black-Scholes option-pricing model, which requires the use of several estimates,
including expected term, expected risk-free interest rate, expected volatility, and expected dividend yield. The
stock options have an exercise price equal to the adjusted closing price of our common stock on the grant date
with a ten-year contractual term. The fair value of the restricted stock is determined using the closing price of
our common stock on the grant date. The restricted stock is not assignable or transferable until it becomes vested.
The fair value of TSR-based PSUs is determined on the grant date using the Monte Carlo Simulation model and
their ultimate achievement is based on relative total shareholder return as compared to the companies that
compromise the S&P 500 index. The fair value of ROIC-based PSUs is determined on the closing price of our
common stock on the grant date and their ultimate achievement is tied to incremental return on invested capital
based on net operating profit. Each of the TSR-based PSUs and ROIC-based PSUs has a three-year performance
period, subject to the recipients continued service. Each PSU represents the right to receive one share of our
common stock and the ultimate realization is based on our achievement of certain market and financial
performance criteria and may range from 0% to 200% of the recipients target levels of 100% established on the
grant date.
Option grants and restricted stock awards are generally expensed ratably over the four-year vesting
period. PSUs are generally expensed ratably over the three-year vesting period. We follow the substantive
vesting period approach for awards granted after January 1, 2005, which requires that stock-based compensation
expense be recognized over the period from the date of grant to the date when the award is no longer contingent
on the employee providing additional service.
We estimate expected forfeitures of equity awards at the date of grant and recognize compensation
expense only for those awards expected to vest. The forfeiture assumption is ultimately adjusted to the actual
forfeiture rate.
Goodwill and Intangibles
As of December 31, 2023, we had goodwill associated with continuing operations of $1,760.8 million,
which represents 40.3% of our total assets. Goodwill and intangible assets with indefinite lives are subject to
impairment testing annually as of June 30, or whenever events or changes in circumstances indicate that the
carrying amount may not be fully recoverable. When evaluating goodwill for impairment, we may decide
to first perform a qualitative assessment, or “Step Zero” impairment test, to determine whether it is more likely
than not that impairment has occurred. The qualitative assessment includes a review of macroeconomic
conditions, industry and market considerations, internal cost factors, and our own overall financial and share
price performance, among other factors. If we do not perform a qualitative assessment, or if we determine that it
is more likely than not that the carrying amounts of our reporting units exceeds their fair value, we perform a
quantitative assessment and calculate the estimated fair value of the respective reporting unit. If the carrying
amount of a reporting unit’s goodwill exceeds the fair value of that goodwill, an impairment loss is recognized.
As of June 30, 2023, we completed our Step Zero impairment test at the reporting unit level and determined it
was not more likely than not that the carrying values of our reporting units exceeded their fair values. We
did not recognize any additional impairment charges related to our goodwill and indefinite-lived intangible
assets. Subsequent to the test performed on June 30, 2023, we continued to monitor these reporting units for
events that would trigger an interim impairment test; we did not identify any such events.
53
We allocate the fair value of the purchase consideration to the tangible assets acquired, liabilities assumed
and intangible assets acquired based on their estimated fair values. The excess of the fair value of the purchase
consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Such
valuations require management to make significant estimates and assumptions, especially with respect to
intangible assets. The estimates used in valuing the intangible assets are determined with the assistance of third-
party specialists, a discounted cash flow analysis and estimates made by management. Management’s estimates
of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and
unpredictable and, as a result, actual results may differ from estimates. During the measurement period, which is
not to exceed one year from the acquisition date, we may record adjustments to the assets acquired and liabilities
assumed, with the corresponding offset to goodwill. Upon the conclusion of the measurement period, any
subsequent adjustments are recorded to earnings.
Pension and Postretirement
Certain assumptions are used in the determination of our annual net period benefit (credit) cost and the
disclosure of the funded status of these plans. The principal assumptions concern the discount rate used to
measure the projected benefit obligation and the expected return on plan assets. We revise these assumptions
based on an annual evaluation of long-term trends and market conditions that may have an impact on the cost of
providing retirement benefits.
In determining the discount rate, we utilize quoted rates from long-term bond indices, and changes in
long-term bond rates over the past year, cash flow models and other data sources we consider reasonable based
upon the life expectancy and mortality rate of eligible employees. As part of our evaluation, we calculate the
approximate average yields on securities that were selected to match our separate projected cash flows for both
the pension and postretirement plans. Our separate benefit plan cash flows are input into actuarial models that
include data for corporate bonds rated AA or better at the measurement date. The outputs from the actuarial
models are assessed against the prior year’s discount rate and quoted rates for long-term bond indices. For our
pension plans at December 31, 2023, we determined this rate to be 5.37% and 5.49% at December 31, 2023 and
2022, respectively. Our postretirement rate was 4.75% and 5.25% at December 31, 2023 and 2022, respectively.
The expected return on plan assets is determined by taking into consideration our analysis of our actual
historical investment returns to a broader long-term forecast adjusted based on our target investment allocation,
and the current economic environment. Our pension asset investment guidelines target an investment portfolio
allocation of 60.0% debt securities and 40.0% equity securities. As of December 31, 2023, the pension plan
assets were allocated 53.5% debt securities, 40.0% equity securities, 5.3% real estate and 1.2% other. The VEBA
Plan target allocation is 100% debt securities. We have used our target investment allocation to derive the
expected return as we believe this allocation will be retained on an ongoing basis that will be commensurate with
the projected cash flows of the plan. The expected return for each investment category within our target
investment allocation is developed using average historical rates of return for each targeted investment category,
considering the projected cash flow of the qualified pension plan and postretirement plan. The difference
between this expected return and the actual return on plan assets is generally deferred and recognized over
subsequent periods through future net periodic benefit (credits) costs. We believe these considerations provide
the basis for reasonable assumptions with respect to the expected long-term rate of return on plan assets.
When actual plan experience differs from the assumptions used, actuarial gains or losses arise. We
amortize, as a component of annual pension expense, total outstanding actuarial gains or losses over the
estimated average expected remaining lifetime of plan participants to the extent that the gain/loss exceeds 10% of
the greater of the beginning-of-year projected benefit obligation or the market-related value of plan assets. For
our pension and postretirement plans, the total actuarial losses as of December 31, 2023 that have not been
recognized in annual expense are $118.3 million and $3.6 million, respectively, and we expect to recognize a net
periodic pension and postretirement expenses of $3.6 million and $0.3 million, respectively, in 2024 related to
the amortization of actuarial losses.
54
A one percent change in discount rate and future rate of return on plan assets would have the following
effects:
Pension
Postretirement
1% Decrease
1% Increase
1% Decrease
1% Increase
Benefit
(Credit)
Cost
Projected
Benefit
Obligation
Benefit
(Credit)
Cost
Projected
Benefit
Obligation
Benefit
(Credit)
Cost
Projected
Benefit
Obligation
Benefit
(Credit)
Cost
Projected
Benefit
Obligation
$(0.5)
$26.3
$ 0.4
$(22.8)
$ —
$0.2
$ —
$(0.2)
Discount Rate . . . . . . . . . . . .
Expected Rate of Return on
Assets . . . . . . . . . . . . . . . .
$ 3.8
$ —
$(3.8)
$ —
$0.1
$ —
$(0.1)
$ —
Income Taxes
In projecting future taxable income, we develop assumptions including the amount of future state, federal
and foreign pretax operating income, the reversal of temporary differences, and the implementation of feasible
and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future
taxable income and are consistent with the plans and estimates we use to manage the underlying businesses. The
calculation of our tax liabilities also involves dealing with uncertainties in the application and evolution of
complex tax laws and regulations in other jurisdictions.
We account for uncertain tax positions in accordance with Accounting for Uncertainty in Income Taxes —
an interpretation of ASC 740, which addresses the determination of whether tax benefits claimed or expected to
be claimed on a tax return should be recorded in the financial statements. Under this interpretation, we may
recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will
be sustained upon examination by the taxing authorities, based on the technical merits of the position.
We recognize and adjust our liabilities when our judgment changes as a result of the evaluation of new
information not previously available. Due to the complexity of some of these uncertainties, the ultimate
resolution may result in a payment that is materially different from our current estimate of the tax liabilities.
These differences will be reflected as increases or decreases to income tax expense in the period in which they
are determined.
We estimate unrecognized tax positions of $0.7 million that may be recognized by December 31, 2024,
due to expiration of statutes of limitations and resolution of audits with taxing authorities, net of additional
uncertain tax positions.
As of December 31, 2023, we have gross federal, state, and foreign income tax net operating loss
carryforwards of $69.0 million, which will expire at various dates from 2024 through 2043. Such net operating
loss carryforwards expire as follows:
Years Ending
2024 - 2031 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2032 - 2036 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2037 - 2043 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(in millions)
$20.5
11.5
37.0
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$69.0
The net deferred income tax liability of $179.3 million consists primarily of timing differences
involving amortization.
55
Recent Accounting Pronouncements
For a discussion of recent accounting pronouncements, refer to Note 2(s) to the audited consolidated
financial statements included in this annual report on Form 10-K.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Interest Rate Risk
We are exposed to market risk from fluctuations in interest rates. As of December 31, 2023, we had no
borrowings outstanding under our Credit Facility. On April 5, 2023, we entered into the Fifth Amendment (the
“Amendment”) to the committed senior unsecured Syndicated Revolving Credit Facility with Bank of America,
N.A. as administrative agent. The Amendment does not change the current borrowing capacity of
$1,000.0 million, but does extend the maturity date to April 5, 2028. Interest on borrowings under the
Amendment is payable at an interest rate of SOFR plus 100.0 to 162.5 basis points, depending upon our public
debt rating. A commitment fee on any unused commitment is payable periodically and may range from 8.0 to
17.5 basis points based upon our public debt rating. A change in interest rates on variable rate debt impacts our
pre-tax income and cash flows but does not impact the fair value of the instruments.
We also maintained a $125.0 million Bilateral Term Loan Facility and a $275.0 million Bilateral
Revolving Credit Facility (together the “Bilateral Credit Facilities”) that matured on September 9, 2023 and
October 2, 2023, respectively. The Bilateral Credit Facilities carried an interest rate of 135 basis points plus
the one-month BSBY and was used for general corporate purposes, including working capital needs and capital
expenditures, acquisitions, dividend payments, and the Repurchase Program. We have had no outstanding
borrowings under our Bilateral Credit Facilities during 2023 through the maturity dates. The Bilateral Credit
Facilities have not been renewed.
Foreign Currency Risk
Our foreign-based businesses and results of operations are exposed to movements in the U.S. dollar to
British pounds and other foreign currency exchange rates. A portion of our revenue is denominated in British
pounds and other foreign currencies. If the U.S. dollar strengthens against British pounds and other foreign
currencies, our revenues reported in U.S. dollars would decline. With regard to operating expense, our primary
exposure to foreign currency exchange risk relates to operating expense incurred in British pounds and other
foreign currencies. If British pounds and other foreign currencies strengthen, costs reported in U.S. dollars will
increase. Movements in the U.S. dollar to British pounds and other foreign currency exchange rates did not have
a material effect on our revenue for the year ended December 31, 2023. A hypothetical ten percent change in
average exchange rates versus the U.S. dollar would not have resulted in a material change to our earnings.
Item 8.
Consolidated Financial Statements and Supplementary Data
The information required by this Item is set forth on pages 53 through 99 of this annual report on
Form 10-K.
Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
56
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We are required to maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e)
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) that are designed to ensure that
information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized,
and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and
that such information is accumulated and communicated to our management, including our Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any
controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives at the reasonable assurance level.
Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, has
evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules
13a-15(e) and 15d-15(e)) as of the end of the period covered by this annual report on Form 10-K for our
Company and subsidiaries other than our recent acquisitions in 2023 (See Note 10. of our consolidated financial
statements included in this annual report on Form 10-K). Management excluded from its assessment the internal
control over financial reporting of these acquisitions and collectively represents less than 0.4% of total assets
(excluding goodwill and intangible assets which were integrated into our systems and control environment) and
less than 0.9% of revenues as of and for the year ended December 31, 2023. Based upon the foregoing
assessments, our Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31,
2023, our disclosure controls and procedures were effective at the reasonable assurance level.
Management’s Report on Internal Control over Financial Reporting
The information required by this Item is set forth on page 48 of this annual report on Form 10-K.
Attestation Report of the Registered Public Accounting Firm
The information required by this Item is set forth on page 49 of this annual report on Form 10-K.
Changes in Internal Control over Financial Reporting
We are in the process of integrating our recent acquisitions in 2023 into our overall internal control over
financial reporting process. Other than this ongoing integration, there have been no changes in our internal
control over financial reporting identified in connection with the evaluation of such internal control that occurred
during the fourth quarter of 2023 that have materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
57
MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Our management is responsible for establishing and maintaining adequate internal control over financial
reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial
reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and
the preparation of the financial statements for external purposes in accordance with U.S. generally accepted
accounting principles. Because of its inherent limitations, a system of internal control over financial reporting
can provide only reasonable assurance and may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that internal control may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may
deteriorate.
Under the supervision and with the participation of our management, including our principal executive
officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control
over financial reporting based on the framework set forth in Internal Control — Integrated Framework issued by
the Committee of Sponsoring Organizations of the Treadway Commission in 2013.
Based on this assessment, management concluded that our internal control over financial reporting was
effective at December 31, 2023.
Management excluded from its assessment the internal control over financial reporting for our
acquisitions in 2023 (See Note 10. of our consolidated financial statements included in this annual report on
Form 10-K). The excluded financial statements of these acquisitions constitute approximately 0.4% of total
assets (excluding goodwill and intangible assets which were integrated into our systems and control
environment) and 0.9% of revenues collectively included within our consolidated financial statements as of and
for the year ended December 31, 2023. Due to the timing of the acquisitions, management did not assess the
effectiveness of internal control over financial reporting for these acquisitions.
Deloitte & Touche LLP, the independent registered public accounting firm that audited the consolidated
financial statements included in this annual report on Form 10-K has also audited the effectiveness of our internal
control over financial reporting as of December 31, 2023, as stated in their report which is included herein.
58
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and the Board of Directors of Verisk Analytics, Inc.
Opinion on Internal Control over Financial Reporting
We have audited the internal control over financial reporting of Verisk Analytics, Inc. and subsidiaries
(the “Company”) as of December 31, 2023, based on criteria established in Internal Control — Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the Company maintained, in all material respects, effective internal control over financial
reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework
(2013) issued by COSO.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31,
2023, of the Company and our report dated February 21, 2024, expressed an unqualified opinion on those
consolidated financial statements.
As described in Management’s Report on Internal Controls over Financial Reporting, management
excluded from its assessment the internal control over financial reporting at Mavera Holding AB, which was
acquired on February 1, 2023, Krug Sachverstandigen GmBH “SV Krug”, which was acquired on April 19,
2023, and Morning Data Ltd., which was acquired on May 25, 2023 (collectively, the “2023 Acquisitions”). The
financial statements of the 2023 Acquisitions constitute less than 0.4% of total assets (excluding goodwill and
intangible assets which were integrated into the Company’s systems and control environment) and less than 0.9%
of revenues of the consolidated financial statement amounts as of and for the year ended December 31, 2023.
Accordingly, our audit did not include the internal control over financial reporting at the 2023 Acquisitions.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial
reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the
accompanying Management’s Report on Internal Controls over Financial Reporting. Our responsibility is to
express an opinion on the Company’s internal control over financial reporting based on our audit. We are a
public accounting firm registered with the PCAOB and are required to be independent with respect to the
Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the
Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial
reporting was maintained in all material respects. Our audit included obtaining an understanding of internal
control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the
design and operating effectiveness of internal control based on the assessed risk, and performing such other
procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable
basis for our opinion.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. A company’s internal control over
financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;
59
(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the
company are being made only in accordance with authorizations of management and directors of the company;
and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use,
or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
/s/ Deloitte & Touche LLP
Morristown, New Jersey
February 21, 2024
60
Item 9B. Other Information
10b5-1 Trading Plans
During the fiscal quarter ended December 31, 2023, the following Section 16 officers and directors
adopted, modified or terminated a “Rule 10b5-1 trading arrangement” (as defined in Item 408 of Regulation S-K
of the Exchange Act):
• Lee M. Shavel, Chief Executive Officer, President and director, adopted a new trading plan on
December 4, 2023 (with the first trade under the new plan scheduled for a date on or after March 15,
2024). The trading plan will be effective until December 31, 2024 to sell 8,000 shares of common
stock.
• Elizabeth D. Mann, Chief Financial Officer, adopted a new trading plan on December 15, 2023 (with
the first trade under the new plan scheduled for a date on or after March 15, 2024). The trading plan
will be effective until December 31, 2024 to sell 2,000 shares of common stock.
• David J. Grover, Controller and Chief Accounting Officer, adopted a new trading plan on
December 14, 2023 (with the first trade under the new plan scheduled for a date on or after March 15,
2024). The trading plan will be effective until April 1, 2024 to sell 6,481 shares of common stock.
There were no “non-Rule 10b5-1 trading arrangements” (as defined in Item 408 of Regulation S-K of the
Exchange Act) adopted, modified or terminated during the fiscal quarter ended December 31, 2023 by Section 16
officers and directors. Each of the Rule 10b5-1 trading arrangements are in accordance with our Insider Trading
Policy and actual sale transactions made pursuant to such trading arrangements will be disclosed publicly in
Section 16 filings with the SEC in accordance with applicable securities laws, rules and regulations.
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
Not applicable.
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required to be furnished by this Item 10 is incorporated herein by reference to our Notice
of Annual Meeting of Stockholders and Proxy Statement to be filed within 120 days of December 31, 2023 (the
“Proxy Statement”).
Our Board of Directors has adopted a Code of Business Conduct and Ethics applicable to all officers,
directors and employees, which is available on our website (investor.verisk.com) under “Corporate Governance”.
We intend to satisfy the disclosure requirement under Item 5.05 of Form 8-K regarding any amendment to, or
waiver from, a provision of our Code of Business Conduct and Ethics by posting such information on the website
address and location specified above.
Item 11. Executive Compensation
The information required to be furnished by this Item 11 is incorporated herein by reference to our Proxy
Statement.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
The information required to be furnished by this Item 12 is incorporated herein by reference to our Proxy
Statement.
61
Item 13. Certain Relationships and Related Transactions and Director Independence
The information required to be furnished by this Item 13 is incorporated herein by reference to our Proxy
Statement.
Item 14. Principal Accounting Fees and Services
The information required to be furnished by this Item 14 is incorporated herein by reference to our Proxy
Statement.
Item 15. Exhibits and Financial Statement Schedule
(a) The following documents are filed as part of this report.
PART IV
(1) Financial Statements. See Index to Financial Statements and Schedules in Part II, Item 8 on this
Form 10-K.
(2) Financial Statement Schedule. See Schedule II. Valuation and Qualifying Accounts and Reserves.
(3) Exhibits. See Index to Exhibits in this annual report on Form 10-K.
Item 16. Form 10-K Summary
None.
62
Item 8.
Consolidated Financial Statements and Supplementary Data
Index to Consolidated Financial Statements and Schedule
Verisk Analytics, Inc. Consolidated Financial Statements as of December 31, 2023 and 2022 and for
the Years Ended December 31, 2023, 2022, and 2021.
Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34)
. . . . . . . . . . . . . . . . . . . . .
Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Comprehensive Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Changes in Stockholders’ Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statements of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Statements Schedule
Schedule II, Valuation and Qualifying Accounts and Reserves
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
64
66
67
68
69
70
72
119
63
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Stockholders and the Board of Directors of Verisk Analytics, Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Verisk Analytics, Inc. and subsidiaries
(the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations,
comprehensive income, stockholders’ equity, and cash flows, for each of the three years in the period ended
December 31, 2023, and the related notes and the schedule listed in the Index at Item 15 (collectively referred to
as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 2023, in conformity with accounting
principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight
Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31,
2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission and our report dated February 21, 2024, expressed an
unqualified opinion on the Company’s internal control over financial reporting.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to
express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Company in accordance with
the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange
Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the
risks of material misstatement of the financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as evaluating the overall presentation of
the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the
financial statements that was communicated or required to be communicated to the audit committee and that
(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially
challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any
way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical
audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to
which it relates.
Goodwill—Insurance Reportable Segment - Refer to Notes 2 and 12 to the financial statements
Critical Audit Matter Description
The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each
reporting unit to its carrying value. For the year ended December 31, 2023, the Company performed its
64
evaluation of goodwill for impairment using a qualitative assessment or “Step Zero” impairment test to
determine whether it is more likely than not that impairment has occurred. If the Company determines that it is
more likely than not that the carrying amount of its’ reporting units exceeds their fair value, the Company would
perform a quantitative assessment or “Step One” impairment test and calculate the estimated fair value of the
respective reporting unit. Changes in the assumptions utilized could have a significant impact on fair value. The
goodwill balance was $1,761 million as of December 31, 2023 which was fully attributable to the Insurance
reportable segment.
We identified the evaluation of goodwill for impairment of the Insurance reportable segment as a critical
audit matter due to significant judgments made by management to determine whether it is more likely than not
that impairment of the underlying reporting units has occurred, including management’s judgment as it relates to
their evaluation of macroeconomic conditions, industry and market considerations, internal cost factors, and the
Company’s overall financial and share price performance, among other factors for the respective reporting units
within the Insurance reportable segment. This required a high degree of auditor judgment and an increased effort,
including the need to involve our fair value specialists.
How the Critical Audit Matter was addressed in the Audit
We, along with the assistance from our fair value specialists, evaluated the reasonableness of management’s Step
Zero assessment by:
• Tested the design and operating effectiveness of management’s internal controls over their goodwill
impairment evaluation, including those over the significant assumptions used in management’s
qualitative Step Zero test.
• Evaluated the Company’s qualitative Step Zero test and inputs, including consideration of
macroeconomic factors, industry and market considerations, internal cost factors, and overall financial
and share price performance, among other factors that could change discount and growth rates, and key
performance indicators, such as projected revenue and EBITDA, and performed sensitivity analysis on
the key assumptions.
•
Performed a retrospective review of current year results compared to the projections used in the most
recent quantitative impairment test.
• Evaluated historical data used in developing the assumptions to assess whether the data is comparable
and consistent with data of the period under audit.
• Assessed the headroom between the most recent fair value estimate performed as of June 30, 2022 and
the carrying value of each reporting unit.
• Held inquires with appropriate management personnel regarding any changes in the Company’s
internal structure that could cause its reporting unit determinations to change in the current year.
• Held ongoing inquires with management, the board of directors, and the legal department regarding
any changes in management strategy or operations during the year that could potentially affect the
drivers of the fair value for each reporting unit.
/s/ Deloitte & Touche LLP
Morristown, New Jersey
February 21, 2024
We have served as the Company’s auditor since 2001.
65
VERISK ANALYTICS, INC.
CONSOLIDATED BALANCE SHEETS
As of December 31, 2023 and 2022
ASSETS:
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current assets held-for-sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent assets:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net
Intangible assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent assets held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
LIABILITIES AND STOCKHOLDERS’ EQUITY:
Current liabilities:
2023
2022
(in millions, except par value
and number of shares)
$
$
302.7
334.2
84.5
23.5
65.2
—
810.1
112.5
290.1
83.7
44.2
32.0
362.6
925.1
604.9
191.7
471.7
1,760.8
30.8
496.1
541.5
182.0
504.8
1,676.0
31.7
371.4
— 2,728.6
$ 6,961.1
$ 4,366.1
Accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term debt and current portion of long-term debt
. . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current liabilities held-for-sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Noncurrent liabilities:
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent liabilities held-for-sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
340.8
14.5
375.1
33.1
7.9
—
771.4
2,852.2
210.1
195.6
14.6
—
4,043.9
$
292.8
1,392.9
321.7
29.5
—
282.3
2,319.2
2,343.2
145.6
189.9
17.9
177.6
5,193.4
Commitments and contingencies (Note 21)
Stockholders’ equity:
Common stock, $.001 par value; 2,000,000,000 shares authorized; 544,003,038 shares
issued; 143,308,729 and 154,701,136 shares outstanding, respectively . . . . . . . . . . .
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Treasury stock, at cost, 400,694,309 and 389,301,902 shares, respectively . . . . . . . . . .
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated other comprehensive income (losses)
Total Verisk stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities and stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.1
2,872.3
(9,037.5)
6,416.9
58.2
310.0
12.2
322.2
$ 4,366.1
0.1
2,720.8
(6,239.5)
5,999.1
(731.2)
1,749.3
18.4
1,767.7
$ 6,961.1
The accompanying notes are an integral part of these consolidated financial statements.
66
VERISK ANALYTICS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For The Years Ended December 31, 2023, 2022, and 2021
2023
2022
2021
(in millions, except per share amounts and number of shares)
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses:
Cost of revenues (exclusive of items shown separately
below) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization of fixed assets . . . . . . . . . . . . .
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . .
Other operating (income) loss . . . . . . . . . . . . . . . . . . . . . . . . . .
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other income (expense):
Investment income (loss) and others, net
Interest expense, net
. . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total other expense, net
. . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations before income taxes . . . . . . .
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
(Loss) income from discontinued operations, net of tax
(expense) benefit of $(12.6), $131.5 and $(29.7), respectively
(Note 11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Net loss (income) attributable to noncontrolling
interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to Verisk . . . . . . . . . . . . . . . . . . .
Basic net income per share attributable to Verisk:
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
Loss from discontinued operations . . . . . . . . . . . . . . . . . . . . . . . .
Basic net income per share attributable to Verisk: . . . . . . . . . . . .
Diluted net income per share attributable to Verisk:
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . .
Loss from discontinued operations . . . . . . . . . . . . . . . . . . . . . . . .
Diluted net income per share attributable to Verisk:
. . . . . . . . . .
Weighted average shares outstanding:
$
2,681.4
$
2,497.0
$
2,462.5
876.5
391.8
206.8
74.6
—
1,549.7
1,131.7
11.0
(115.5)
(104.5)
1,027.2
(258.8)
768.4
(154.0)
614.4
0.2
614.6
5.24
(1.05)
4.19
5.22
(1.05)
4.17
$
$
$
$
$
824.6
381.5
164.2
74.4
(354.2)
1,090.5
1,406.5
(5.3)
(138.8)
(144.1)
1,262.4
(220.3)
1,042.1
(87.8)
954.3
(0.4)
953.9
6.60
(0.56)
6.04
6.55
(0.55)
6.00
$
$
$
$
$
853.7
313.2
170.3
79.9
134.0
1,551.1
911.4
2.1
(127.0)
(124.9)
786.5
(179.4)
607.1
59.2
666.3
(0.1)
666.2
3.75
0.37
4.12
3.72
0.36
4.08
$
$
$
$
$
Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
146,623,989
157,905,718
161,841,441
Diluted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
147,336,159
158,928,942
163,338,909
The accompanying notes are an integral part of these consolidated financial statements.
67
VERISK ANALYTICS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For The Years Ended December 31, 2023, 2022, and 2021
2023
2022
2021
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 614.4
(in millions)
$ 954.3
$666.3
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . .
Pension and postretirement liability adjustment
Total other comprehensive income (loss) . . . . . . . . . . . . . . . . . . . . . . . . .
768.2
21.8
790.0
(300.3)
(37.7)
(46.3)
26.9
(338.0)
(19.4)
Comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Comprehensive (gain) loss attributable to noncontrolling interests . . . . . . . . .
1,404.4
(0.4)
616.3
1.1
646.9
0.4
Comprehensive income attributable to Verisk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,404.0
$ 617.4
$647.3
The accompanying notes are an integral part of these consolidated financial statements.
68
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VERISK ANALYTICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For The Years Ended December 31, 2023, 2022, and 2021
2023
2022
2021
(in millions)
Cash flows from operating activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Adjustments to reconcile net income to net cash provided by operating
$ 614.4
$ 954.3
$ 666.3
activities:
Depreciation and amortization of fixed assets . . . . . . . . . . . . . . . . . . . . . . .
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of debt issuance costs and original issue discount, net of
original issue premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss (gain) on sale of assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment of cost-based investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Stock-based compensation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment of long-lived assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loss on disposal of fixed assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Acquisition related liability adjustment
Changes in assets and liabilities, net of effects from acquisitions:
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses and other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
206.8
74.6
1.5
8.7
131.1
6.5
54.0
—
52.7
3.8
(20.0)
(83.0)
(56.9)
26.8
(55.8)
46.5
81.2
(27.1)
(5.1)
197.1
142.9
1.1
7.0
(393.9)
—
56.5
377.4
(261.0)
1.1
—
(57.7)
(8.4)
46.6
25.6
(21.2)
64.5
(43.9)
(29.0)
206.9
176.7
1.4
17.7
—
—
55.7
134.0
49.8
0.4
—
(29.7)
(33.6)
41.3
(5.7)
(80.8)
32.4
(41.3)
(35.8)
Net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . .
1,060.7
1,059.0
1,155.7
Cash flows from investing activities:
Acquisitions and purchases of controlling interests, net of cash acquired of
$8.0, $17.4, and $9.3, respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from sale of businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments in nonpublic companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Escrow funding associated with acquisitions . . . . . . . . . . . . . . . . . . . . . . . .
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Payment of contingent liability related to acquisitions . . . . . . . . . . . . . . . . .
Other investing activities, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(83.3)
3,066.4
(2.2)
(3.8)
(230.0)
—
(0.6)
(448.9)
1,073.3
(46.0)
(2.3)
(274.7)
—
—
Net cash provided by (used in) investing activities . . . . . . . . . . . . . . . . .
2,746.5
301.4
(289.8)
—
(23.6)
(9.2)
(268.4)
(1.2)
0.2
(592.0)
The accompanying notes are an integral part of these consolidated financial statements.
70
VERISK ANALYTICS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
For The Years Ended December 31, 2023, 2022, and 2021
2023
2022
2021
(in millions)
Cash flows from financing activities:
(Repayment of) proceeds from short-term debt, net
Repayments of current portion of long-term debt
Proceeds from issuance of long-term debt, inclusive of original issue
. . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
(1,265.0)
—
380.0
(350.0)
560.0
(450.0)
premium and net of original issue discount . . . . . . . . . . . . . . . . . . . . . . . . .
495.2
—
Proceeds from issuance of short-term debt with original maturities less than
three months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
—
400.0
—
—
Repayment of short-term debt with original maturities greater than three
months . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Payment of debt issuance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Repurchases of common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net share settlement of taxes from restricted stock and performance share
awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Proceeds from stock options exercised . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Treasury stock shares repurchased not yet settled . . . . . . . . . . . . . . . . . . . . . .
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other financing activities, net
(125.0)
(6.0)
(2,762.3)
—
—
(1,662.5)
—
—
(475.0)
(15.3)
141.9
(37.5)
(196.8)
(15.7)
(20.7)
132.5
—
(195.2)
(14.3)
(11.8)
84.3
—
(188.2)
(18.2)
Net cash used in financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3,786.5)
(1,330.2)
(498.9)
Effect of exchange rate changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(10.7)
(17.8)
(3.3)
Increase in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash and cash equivalents, beginning of period . . . . . . . . . . . . . . . . . . . . . . .
10.0
292.7
Cash and cash equivalents, end of period . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
302.7
Supplemental disclosures:
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
276.0
111.2
Noncash investing and financing activities:
Deferred tax liability established on date of acquisitions . . . . . . . . . . . . . . . .
$
8.7
Net assets sold as part of the dispositions, net of cash sold . . . . . . . . . . . . . . .
$ 3,211.8
Finance lease additions, net of disposals . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease additions, net of terminations . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets included in accounts payable and accrued liabilities . . . . . . . . . .
$
$
$
45.6
34.3
2.2
12.4
280.3
61.5
218.8
292.7
$ 280.3
324.5
$ 175.0
134.3
$ 129.0
14.0
$ 21.0
— $ —
5.2
$
7.0
21.7
$ 22.4
0.2
$
5.3
$
$
$
$
$
$
$
$
The accompanying notes are an integral part of these consolidated financial statements.
71
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Amounts in millions, except for share and per share data, unless otherwise stated)
1. Organization:
Verisk Analytics, Inc. is a strategic data analytics and technology partner to the global insurance industry.
We empower clients to strengthen operating efficiency, improve underwriting and claims outcomes,
combat fraud and make informed decisions about global risks, including climate change, extreme events, ESG
(environmental, social, and governance), and political issues. Through advanced data analytics, software,
scientific research, and deep industry knowledge, we help build global resilience for individuals, communities,
and businesses. We trade under the ticker symbol “VRSK” on the Nasdaq Global Select Market.
2. Basis of Presentation and Summary of Significant Accounting Policies:
Our accompanying consolidated financial statements have been prepared on the basis of accounting
principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial
statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect
the reported amounts of assets, liabilities, disclosure of contingent assets and liabilities at the date of the financial
statements, and the reported amounts of revenues and expenses during the reporting periods. Significant
estimates include acquisition purchase price allocations, the fair value of goodwill, the realization of deferred tax
assets and liabilities, acquisition-related liabilities, fair value of stock-based compensation for equity awards
granted, and assets and liabilities for pension and postretirement benefits. Actual results may ultimately differ
from those estimates.
On February 1, 2023, we completed the sale of our Energy business. We determined that the sale of our
Energy business met the “discontinued operations” criteria in accordance with Financial Accounting Standard
Boards (“FASB”) Accounting Standards Codification (“ASC”) 205-20, Discontinued Operations (“ASC
205-20”) due to its relative size and strategic rationale. The consolidated balance sheets and consolidated
statements of operations, and the notes to the consolidated financial statements were recasted for all periods
presented to reflect the discontinuation of the Energy business, in accordance with ASC 205-20. The discussion
in the notes to these consolidated financial statements, unless otherwise noted, relate solely to our continuing
operations.
Significant accounting policies include the following:
(a)
Intercompany Accounts and Transactions
The consolidated financial statements include all of our accounts. All intercompany accounts and
transactions have been eliminated.
(b) Revenue Recognition
The following describes our primary types of revenues and the applicable revenue recognition
policies. We recognize revenues through recurring and non-recurring long-term agreements (generally
one to five years) for hosted subscriptions, advisory/consulting services, and for transactional solutions.
Our revenues are primarily derived from the sale of services where revenue is recognized when control of
the promised services is transferred to customers in an amount that reflects the consideration that we
expect to be entitled to in exchange for those services. Fees for services provided by us are
non-refundable. Revenue is recognized net of applicable sales tax withholdings.
Hosted Subscriptions
We offer two forms of hosted subscriptions. The first and most prevalent form of hosted
subscription is where customers access content only through our online portal (the “Hosted
72
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Subscription”). We grant a license to our customer to enter our online portal. The license is a contractual
mechanism that allows our customer to access our online portal for a defined period of time. As the
license alone does not provide utility to our customer, our customer has no contractual right to take
possession of our online portal at any time, and our customer cannot engage another party to host our
online portal and related content, it is not considered a functional license under ASC 606, Revenue from
Contracts with Customers (“ASC 606”). Our promise to our customer is to provide continuous access to
our online portal and to update the content throughout the subscription period. Hosted Subscription is a
single performance obligation that represents a series of distinct services (daily access to our online portal
and related content) that are substantially the same and that have the same pattern of transfer to our
customer. We recognize revenue for Hosted Subscriptions ratably over the subscription period on a
straight-line basis as services are performed and continuous access to information in our online portal is
provided over the entire term of the agreements.
The second form of hosted subscription is where customers have access to our online portals
combined with software content that is delivered via disk drive/download to our customer (“Hosted
Subscription with Disk Drive/Download”) and is offered only on a limited basis. For this form of hosted
subscription, we also grant our customer a license to enter our online portal as well as access the software
content as needed and act as the same contractual mechanism as described for Hosted Subscriptions. The
Hosted Subscription with Disk Drive/Download works in such a manner that our customer gains
significant benefit, functionality, and overall utility only when the online portal and the software content
are used together. The disk drive/download contains the models while the online portal contains the latest
data and research which is updated throughout the subscription period. The models within the disk drive/
download depend on the data and research contained within our online portal. The data and research
within our online portal is only useful when our customer can utilize it within the models (e.g., queries,
projections, etc.) so that they may use the most current information and alerts to forecast potential future
losses. The software content is only sold together with our online portal to provide a highly
interdependent and interrelated promise and therefore represents a single performance obligation. As our
customer has no contractual right to take possession of our online portal at any time, and our customer
cannot engage another party to host our online portal and related software content, it is not considered a
functional license under ASC 606. Our promise to our customer is to deliver the disk drive/download, to
provide continuous access to our online portal, and to update the software content throughout the
subscription period. We recognize revenue for Hosted Subscriptions with Disk Drive/Download ratably
over the subscription period on a straight-line basis as services are performed and continuous access to
information is provided over the entire term of the agreements.
Subscriptions are generally paid in advance of rendering services either quarterly or annually upon
commencement of the subscription period.
Advisory/Consulting Services
We provide certain discrete project based advisory/consulting services, which are recognized over
time by measuring the progress toward complete satisfaction of the performance obligation, based on the
input method of consulting hours worked; this aligns with the results achieved and value transferred to
our customer. The hours consumed are most reflective of the measure of progress towards satisfying the
performance obligation, as the resources hours worked directly tie to the progress of the services to be
provided. In general, they are billed over the course of the project.
73
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Transactional Solutions
Certain solutions are also paid for by customers on a transactional basis. We recognize these
revenues as the solutions are delivered or services performed at a point in time. In general, our customers
are billed monthly at the end of each month.
(c) Deferred Revenues
We invoice our customers in annual, quarterly, monthly, or milestone installments. Amounts
billed and/or collected in advance of services being provided are recorded as “Deferred revenues” and
“Other noncurrent liabilities” in our accompanying consolidated balance sheets and are recognized as the
services are performed, control is transferred to customers, and the applicable revenue recognition criteria
is met.
(d)
Accounts Receivable and Allowance for Doubtful Accounts
Accounts receivable are generally recorded at the invoiced amount. Unbilled receivables are
short-term in nature and expected to be billed within one year. The allowance for doubtful accounts or
expected credit losses is estimated based on an analysis of the aging of the accounts receivable, historical
write-offs, customer payment patterns, individual customer credit worthiness, current economic trends,
reasonable and supportable forecasts of future economic conditions, and/or establishment of specific
reserves for customers in adverse financial condition. We assess the adequacy of the allowance for
doubtful accounts on a quarterly basis.
(e) Deferred Commissions
We recognize an asset for the incremental costs of obtaining a contract with a customer if
we expect the benefit of those costs to be longer than one year. We have determined that certain sales
incentive programs meet the requirements to be capitalized. The incremental costs of obtaining a contract
with a customer, which primarily consist of sales commissions, are deferred and amortized over a useful
life of five years that is consistent with the transfer to our customer the services to which the asset
relates. We classify deferred commissions as current or noncurrent based on the timing of expense
recognition. The current and noncurrent portions of deferred commissions are included in “Prepaid
expenses” and “Other noncurrent assets”, respectively, in our consolidated balance sheets as of
December 31, 2023. Amortization expense related to deferred commissions is computed on a straight-line
basis over its estimated useful lives and included in “Selling, general and administrative” within our
accompanying consolidated statements of operations.
(f)
Fixed Assets and Finite-lived Intangible Assets
Fixed assets and finite-lived intangibles are stated at cost less accumulated depreciation and
amortization, which are computed on a straight-line basis over their estimated useful lives. Leasehold
improvements are amortized over the shorter of the useful life of the asset or the lease term.
Our internal software development costs primarily relate to internal-use software. Such costs are
capitalized in the application development stage in accordance with ASC 350-40, Internal-use Software
(“ASC 350-40”). We also capitalize software development costs upon the establishment of technological
feasibility for a product in accordance with ASC 985-20, Software to be Sold, Leased, or Marketed
(“ASC 985-20”). Software development costs are amortized on a straight-line basis.
74
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
In accordance with ASC 360, Property, Plant & Equipment, whenever events or changes in
circumstances indicate that the carrying amount of long-lived assets and finite-lived intangible assets may
not be recoverable, we review our long-lived assets and finite-lived intangible assets for impairment by
first comparing the carrying value of our assets to the sum of the undiscounted cash flows expected to
result from the use and eventual disposition of our assets. If the carrying value exceeds the sum of our
assets’ undiscounted cash flows, we estimate and recognize an impairment loss by taking the difference
between the carrying value and fair value of our assets. In the first quarter of 2022, we reassessed the
recoverability of long-lived assets for our Financial Services reporting unit and recorded a $73.7 million
impairment. For the year ended 2021, we had a $134.0 million impairment to the long-lived assets for our
Financial Services reporting unit including $88.2 million to intangible assets and $45.8 million to fixed
assets.
(g)
Leases
We have operating and finance leases for corporate offices, data centers, and certain equipment
that are accounted for under ASC 842, Leases. The lease term for our corporate headquarters ends in 2033
and includes the options to extend for one 10-year renewal period and two 5-year renewal periods.
We determine if an arrangement is a lease at inception. We consider any contract where there is an
identified asset and that it has the right to control the use of such asset in determining whether the
contract contains a lease. A right-of-use (“ROU”) asset represents our right to use an underlying asset for
the lease term and the lease liabilities represent our obligation to make lease payments arising from the
lease. Operating lease ROU assets and lease liabilities are recognized at the commencement date based on
the present value of lease payments over the lease term. As our operating leases do not provide an
implicit rate, we use an incremental borrowing rate based on the information available on the adoption
date in determining the present value of lease payments. The incremental borrowing rate was calculated
by using our credit rating on our publicly-traded U.S. unsecured bonds and estimating an appropriate
credit rating for similar secured debt instruments. Our calculated credit rating on secured debt instruments
determined the yield curve used. We calculated an implied spread and applied the spreads to the risk-free
interest rates based on the yield of the U.S. Treasury zero coupon securities with a maturity equal to the
remaining lease term in determining the borrowing rates for all operating leases. Our operating lease
ROU assets include any lease payments made prior to the rent commencement date and exclude lease
incentives. Lease expense for lease payments is recognized on a straight-line basis over the lease term.
Operating lease transactions are included in “Operating lease right-of-use assets, net”, and “Operating
lease liabilities”, current and noncurrent, within our accompanying consolidated balance sheets. Finance
leases are included in property and equipment under “Fixed assets, net”, “Short-term debt and current
portion of long-term debt”, and “Long-term debt” within our accompanying consolidated balance sheets.
(h)
Fair Value of Financial and Non-financial Instruments
We follow the provisions of ASC 820-10, Fair Value Measurements (“ASC 820-10”), which
defines fair value, establishes a framework for measuring fair value under U.S. GAAP and expands fair
value measurement disclosures. We follow the provisions of ASC 820-10 for our financial assets and
liabilities recognized or disclosed at fair value on a recurring basis. We follow the provisions of ASC
820-10 for our non-financial assets and liabilities recognized or disclosed at fair value.
(i)
Foreign Currency
We have determined local currencies are the functional currencies of our foreign operations. The
assets and liabilities of foreign subsidiaries are translated at the period-end rate of exchange and statement
75
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
of operations items are translated at the average rates prevailing during the year. The resulting translation
adjustment is recorded as a component of “Accumulated other comprehensive losses” in
our accompanying consolidated statements of changes in stockholders’ equity.
(j)
Stock-Based Compensation
We follow ASC 718, Stock Compensation (“ASC 718”). Under ASC 718, stock-based
compensation cost is measured at the grant date, based on the fair value of the awards granted, and is
recognized as expense over the requisite service period.
Our nonqualified stock options have an exercise price equal to the closing price of our common
stock on the grant date, with a ten-year contractual term. The expected term for our stock options granted
for a majority of the awards granted was estimated based on studies of historical experience and projected
exercise behavior. However, for certain awards granted, for which no historical exercise pattern exists,
the expected term was estimated using the simplified method. The risk-free interest rate is based on the
yield of U.S. Treasury zero coupon securities with a maturity equal to the expected term of the equity
award. The volatility factor is calculated using our historical daily closing prices over the most recent
period that is commensurate with the expected term of the stock option awards. The expected dividend
yield was based on our expected annual dividend rate on the date of grant.
The fair value of our restricted stock is determined using the closing price of our common stock
on the grant date. Our restricted stock is not assignable or transferable until it becomes vested. Restricted
stock generally has a service vesting period of four years and we recognize the expense ratably over this
service vesting period.
Performance share units (“PSU”) vest at the end of a three-year performance period, subject to the
recipient’s continued service. Each PSU represents the right to receive one share of our common stock
and the ultimate realization is based on our achievement of certain market performance criteria. We
determined the grant date fair value of PSUs with the assistance of a third-party valuation specialist and
based on estimates provided by us. The valuation of our PSUs employed the Monte Carlo simulation
model, which includes certain key assumptions that were applied to us and our peer group. Those key
assumptions included valuation date stock price, expected volatility, correlation coefficients, risk-free rate
of return, and expected dividend yield. The valuation date stock price is based on the dividend-adjusted
closing price on the grant date. Expected volatility is calculated using historical daily closing prices over
a period that is commensurate with the length of the performance period. The correlation coefficients are
based on the price data used to calculate the historical volatilities. The risk-free rate of return is based on
the yield of U.S. Treasury zero coupon securities with a maturity equal to the length of the performance
period. The expected dividend yield was based on our and our peer group’s expected dividend rate over
the performance period. PSUs are tied to the achievement of certain market performance conditions,
namely relative total shareholder return as compared to the S&P 500 index (“TSR-based PSUs”).
We estimate expected forfeitures of equity awards at the date of grant and recognize compensation
expense only for those awards expected to vest. The forfeiture assumption is ultimately adjusted to the
actual forfeiture rate. Estimated forfeiture is ultimately adjusted to actual forfeiture. Changes in the
forfeiture assumptions may impact the total amount of expense ultimately recognized, as well as the
timing of expense recognized over the requisite service period.
Excess tax benefit from exercised stock options, lapsing of restricted stock and PSUs is recorded
as an income tax benefit in our accompanying consolidated statements of operations. This tax benefit is
calculated as the excess of the intrinsic value of options exercised and of the market value of restricted
stock lapsed over the compensation recognized for financial reporting purposes.
76
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(k)
Research and Development Costs
Research and development costs, which are primarily related to personnel and related overhead
costs incurred in developing new services for customers, are expensed as incurred. Such costs were
$36.8 million, $43.1 million, and $47.1 million for the years ended December 31, 2023, 2022, and
2021, respectively, and were included in our accompanying consolidated statements of operations.
(l)
Advertising Costs
Advertising costs, which are primarily associated with promoting our brand, names and solutions
provided, are expensed as incurred. Such costs were $11.9 million, $14.7 million, and $12.0 million for
the years ended December 31, 2023, 2022, and 2021, respectively.
(m)
Income Taxes
We account for income taxes under the asset and liability method under ASC 740, Income Taxes
(“ASC 740”), which requires the recognition of deferred tax assets and liabilities for the expected future
tax consequences of events that have been included in the financial statements. Under this method,
deferred tax assets and liabilities are determined based on the differences between the financial statements
and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences
are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is
recognized in income in the period that includes the enactment date.
Deferred tax assets are recorded to the extent these assets are more likely than not to be realized.
In making such determination, we consider all available positive and negative evidence, including future
reversals of existing taxable temporary differences, projected future taxable income, tax planning
strategies, and recent financial operations. Valuation allowances are recognized to reduce deferred tax
assets if it is determined to be more likely than not that all or some of the potential deferred tax assets will
not be realized.
We follow ASC 740-10, Income Taxes (“ASC 740-10”), which clarifies the accounting for
uncertainty in income taxes recognized in the financial statements. ASC 740-10 provides that a tax
benefit from an uncertain tax position may be recognized based on the technical merits when it is more
likely than not that the position will be sustained upon examination, including resolutions of any related
appeals or litigation processes. Income tax positions must meet a more likely than not recognition
threshold in accordance with ASC 740-10. This standard also provides guidance on measurement,
derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and
transition.
We recognize interest and penalties related to unrecognized tax benefits within the income tax
expense line in our accompanying consolidated statements of operations. Accrued interest and penalties
are included within “Other liabilities” on our accompanying consolidated balance sheets.
(n)
Earnings Per Share
Basic and diluted earnings per share (“EPS”) are determined in accordance with ASC 260,
Earnings per Share, which specifies the computation, presentation and disclosure requirements for EPS.
Basic EPS excludes all dilutive common stock equivalents. It is based upon the weighted average number
of common shares outstanding during the period. Diluted EPS, as calculated using the treasury stock
method, reflects the potential dilution that would occur if our dilutive outstanding stock options and stock
awards were issued.
77
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(o)
Pension and Postretirement Benefits
We account for our pension and postretirement benefits under ASC 715, Compensation —
Retirement Benefits (“ASC 715”). ASC 715 requires the recognition of the funded status of a benefit plan
in the balance sheet, the recognition in other comprehensive income (loss) of gains or losses and prior
service costs arising during the period, but which are not included as components of periodic benefit cost
or credit, and the measurement of defined benefit plan assets and obligations as of the balance sheet date.
We utilize a valuation date of December 31.
(p)
Product Warranty Obligations
We provide warranty coverage for certain of our solutions. We recognize a product warranty
obligation when claims are probable and can be reasonably estimated. As of December 31, 2023 and
2022, product warranty obligations were not material.
(q)
Loss Contingencies
We accrue for costs relating to litigation, claims, and other contingent matters when such
liabilities become probable and reasonably estimable. Such estimates are based on management’s
judgment. Actual amounts paid may differ from amounts estimated, and such differences will be charged
to operations in the period in which the final determination of the liability is made.
In the ordinary course of business, we enter into numerous agreements that contain standard
indemnities whereby we indemnify another party for breaches of confidentiality, infringement of
intellectual property or gross negligence. Such indemnifications are primarily granted under licensing of
computer software. Most agreements contain provisions to limit the maximum potential amount of future
payments that we could be required to make under these indemnifications; however, we are not able to
develop an estimate of the maximum potential amount of future payments to be made under these
indemnifications as the triggering events are not subject to predictability.
(r) Goodwill and Indefinite-Lived Intangible Assets
Goodwill represents the excess of acquisition costs over the fair value of tangible net assets and
identifiable intangible assets of our businesses acquired. Goodwill and intangible assets deemed to have
indefinite lives are not amortized. Intangible assets determined to have finite lives are amortized over
their useful lives. Goodwill and intangible assets with indefinite lives are subject to impairment testing
annually as of June 30, or whenever events or changes in circumstances indicate that the carrying
amount may not be fully recoverable. When evaluating goodwill for impairment, we may decide
to first perform a qualitative assessment, or “Step Zero” impairment test, to determine whether it is more
likely than not that impairment has occurred. The qualitative assessment includes a review of
macroeconomic conditions, industry and market considerations, internal cost factors, and our own overall
financial and share price performance, among other factors. If we do not perform a qualitative
assessment, or if we determine that it is more likely than not that the carrying amounts of our reporting
units exceeds their fair value, we perform a quantitative assessment and calculate the estimated fair value
of the respective reporting unit. If the carrying amount of a reporting unit’s goodwill exceeds the fair
value of that goodwill, an impairment loss is recognized.
78
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(s) Recent Accounting Pronouncements
Accounting Standard
Description
Leases (Topic 842) In
March 2023, the
FASB issued
Accounting Standards
Update “ASU”
No. 2023-01,
Common Control
Arrangements (“ASU
No. 2023-01”)
This update amends the accounting
for leasehold improvements in
common-control arrangements for all
entities. The amendment requires a
lessee in a common-control lease
arrangement to amortize leasehold
improvements that it owns over the
improvements’ useful life to the
common control group, regardless of
the lease term, if the lessee continues
to control the use of the underlying
asset through a lease.
Segment Reporting
(Topic 280) In
November 2023, the
FASB issued
Accounting Standards
Update “ASU”
No. 2023-07,
Improvements to
Reportable Segment
Disclosures (“ASU
No. 2023-07”)
Income Taxes (Topic
740) In December
2023, the FASB
issued Accounting
Standards Update
“ASU” No. 2023-09,
Improvements to
Income Tax
Disclosures (ASU
No. 2023-09)
This updates changes the reportable
segment disclosure requirements
requiring enhanced disclosures about
significant segment expenses. Public
entities are required to disclose
significant segment expenses that are
regularly provided to the chief
operating decision maker and to
disclose how reported measures of
segment profit or loss are used in
assessing segment performance and
allocating resources.
The amendments in within ASU
No. 2023-09 address investor
requests for more transparency about
income tax information through
improvements to income tax
disclosures primarily related to the
rate reconciliation and income taxes
paid information. This Update also
includes certain other amendments to
improve the effectiveness of income
tax disclosures
3. Cash and Cash Equivalents:
Effective Date
ASU No. 2023-01
is effective for
fiscal years
beginning after
December 15,
2023, including
interim periods
within those fiscal
years. Early
adoption is
permitted in any
annual or interim
period as of the
beginning of the
related fiscal year.
ASU No. 2023-07
are effective for
fiscal years
beginning after
December 15,
2023, and interim
periods within
fiscal years
beginning after
December 15,
2024. Early
adoption is
permitted.
The ASU’s
amendments are
effective for
public business
entities for fiscal
years beginning
after
December 15,
2024. Early
adoption is
permitted.
Effect on Consolidated
Financial Statements or
Other Significant Matters
The adoption of this guidance is not
expected to have a material impact
on our consolidated financial
statements.
The adoption of this guidance is not
expected to have a material impact
on our consolidated financial
statements.
The adoption of this guidance is not
expected to have a material impact
on our consolidated financial
statements.
Cash and cash equivalents consist of cash in banks, commercial paper, money-market funds, and other
liquid instruments with original maturities of 90 days or less at the time of purchase.
79
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
4. Accounts Receivable:
Accounts receivable, net consisted of the following at December 31:
Billed receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unbilled receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$317.1
32.2
$273.7
30.7
Total receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
349.3
(15.1)
304.4
(14.3)
Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$334.2
$290.1
2023
2022
5. Concentration of Credit Risk:
Financial instruments that potentially expose us to credit risk consist primarily of cash and cash
equivalents as well as accounts receivable, net, which are generally not collateralized. We maintain our cash and
cash equivalents in higher credit quality financial institutions in order to limit the amount of credit exposure. As
of December 31, 2023 and December 31, 2022, a vast majority of our domestic cash and cash equivalents is with
TD Bank, N.A., and JPMorgan Chase N.A. The total domestic cash balances are insured by the Federal Deposit
Insurance Corporation (“FDIC”) to a maximum amount of $250.0 thousand per bank as of December 31, 2023
and 2022.
As of December 31, 2023 and 2022, we had cash balances on deposit with seven and five banks that
exceeded the balance insured by the FDIC limit by approximately $171.8 million and $36.0 million, respectively.
As of December 31, 2023 and 2022, we also had cash on deposit with foreign banks of approximately
$129.2 million and $74.9 million, respectively.
We consider the concentration of credit risk associated with our accounts receivable to be commercially
reasonable and believe that such concentration does not result in the significant risk of near-term severe adverse
impacts. Our top fifty customers represent approximately 45% of revenues for 2023, 41% for 2022 and 38%
for 2021, respectively, with no individual customer accounting for more than approximately 3% of revenues for
the years ended December 31, 2023, 2022, and 2021 respectively. No individual customer comprised more than
approximately 5% and 6% of accounts receivable as of December 31, 2023 and 2022, respectively.
80
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
6. Revenues:
Disaggregated revenues by type of service and by country are provided below for the years ended
December 31, 2023, 2022, and 2021. No individual country outside of the U.S. accounted for more than 10.0% of
our consolidated revenues for the years ended December 31, 2023, 2022, or 2021.
2023
2022
2021
Insurance:
Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,892.7
788.7
$1,734.5
702.5
$1,555.1
651.8
Total Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Specialized Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,681.4
—
—
2,437.0
22.4
37.6
2,206.9
112.8
142.8
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,681.4
$2,497.0
$2,462.5
Revenues:
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
United Kingdom . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,238.3
190.1
253.0
$2,120.1
169.5
207.4
$2,057.7
169.0
235.8
Total revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,681.4
$2,497.0
$2,462.5
2023
2022
2021
Contract assets are defined as an entity’s right to consideration in exchange for goods or services that the
entity has transferred to a customer when that right is conditioned on something other than the passage of time.
As of December 31, 2023 and 2022, we had no contract assets.
Contract liabilities are defined as an entity’s obligation to transfer goods or services to a customer for
which the entity has received consideration (or an amount of consideration is due) from the customer. As of
December 31, 2023 and 2022, we had contract liabilities that primarily related to unsatisfied performance
obligations to provide customers with the right to use and update the online content over the remaining contract
term of $375.1 million and $321.7 million, respectively. Contract liabilities, which are current and noncurrent,
are included in “Deferred revenues” and “Other noncurrent liabilities” in our consolidated balance sheets,
respectively, as of December 31, 2023 and 2022.
The following is a summary of the change in contract liabilities from December 31, 2020 through
December 31, 2022:
Contract Liabilities at December 31, 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dispositions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Billings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Contract Liabilities at December 31, 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Billings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
349.3
(2,497.0)
3.4
(61.0)
2,527.0
321.7
(2,681.4)
(3.0)
2,737.8
Contract Liabilities at December 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
375.1
81
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Our most significant remaining performance obligations relate to providing customers with the right to
use and update the online content over the remaining contract term. Our disclosure of the timing for satisfying
the performance obligation is based on the requirements of contracts with customers. However, from time to
time, these contracts may be subject to modifications, impacting the timing of satisfying the performance
obligations. These performance obligations, which are expected to be satisfied within one year, comprised
approximately 99% and 98% of the balance as of December 31, 2023 and 2022, respectively.
We recognize an asset for incremental costs of obtaining a contract with a customer if we expect the
benefits of those costs to be longer than one year. As of December 31, 2023 and 2022, we had deferred
commissions of $76.4 million and $69.7 million, respectively, which have been included in “Prepaid expenses”
and “Other noncurrent assets” in our accompanying consolidated balance sheets.
7. Fair Value Measurements:
Certain assets and liabilities are reported at fair value in our accompanying consolidated balance sheets.
Such assets and liabilities include amounts for both financial and non-financial instruments. To increase
consistency and comparability of assets and liabilities recorded at fair value, ASC 820-10 established a
three-level fair value hierarchy to prioritize the inputs to valuation techniques used to measure fair value. ASC
820-10 requires disclosures detailing the extent to which companies’ measure assets and liabilities at fair value,
the methods and assumptions used to measure fair value, and the effect of fair value measurements on earnings.
In accordance with ASC 820-10, we applied the following fair value hierarchy:
Level 1 — Assets or liabilities for which the identical item is traded on an active exchange, such as
publicly-traded instruments.
Level 2 — Assets and liabilities valued based on observable market data for similar instruments.
Level 3 — Assets or liabilities for which significant valuation assumptions are not readily observable in
the market; instruments valued based on the best available data, some of which is
internally-developed, and considers risk premiums that a market participant would require.
The fair value of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities,
and short-term debt approximate their carrying amounts because of the short-term nature of these instruments.
Our investments in registered investment companies, which are Level 1 assets measured at fair value on a
recurring basis using quoted prices in active markets multiplied by the number of shares owned, were
$1.2 million and $4.0 million as of December 31, 2023 and 2022, respectively. Our investments in registered
investment companies have been included in “Other current assets” in our consolidated balance sheets as of
December 31, 2023 and 2022.
We elected not to carry our long-term debt at fair value. The carrying value of our long-term debt
represents the amortized cost, inclusive of unamortized premium, and net of unamortized discount and debt
issuance costs. We assess the fair value of these financial instruments based on an estimate of interest rates
available to us for financial instruments with similar features, our current credit rating, and spreads applicable to
us. The following table summarizes the carrying value and estimated fair value of these financial instruments as
of December 31, 2023 and 2022, respectively:
Financial instrument not carried at fair value:
Senior Notes (Note 15) . . . . . . . . . . . . . . . . . . . . . . . .
Level 2
$2,833.7
$2,735.3
$2,342.6
$2,113.3
2023
2022
Fair Value
Hierarchy
Carrying
Value
Estimated
Fair Value
Carrying
Value
Estimated
Fair Value
82
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
As of December 31, 2023 and 2022, we had securities without readily determinable market values of
$200.9 million and $201.5 million, respectively, which were accounted for at cost. We do not have the ability to
exercise significant influence over the investees’ operating and financial policies or do not hold investments in
common stock or in-substance common stock in such entities. As of December 31, 2023 and 2022, we also had
investments in private companies of $30.5 million and $28.3 million, respectively, accounted for in accordance
with ASC 323-10-25, The Equity Method of Accounting for Investments in Common Stock (“ASC 323-10-25”) as
equity method investments. All such investments were included in “Other noncurrent assets” in our
accompanying consolidated balance sheets. For the years ended December 31, 2023 and 2022, there was no
provision for credit losses related to these investments.
8. Leases:
We have operating and finance leases for corporate offices, data centers, and certain equipment that are
accounted for under ASC 842. The lease term for our corporate headquarters ends in 2033 and includes the
options to extend for one 10-year renewal period and two 5-year renewal periods. Extension and termination
options are considered in the calculation of our ROU assets and lease liabilities when we determine it is
reasonably certain that we will exercise those options.
The following table presents the consolidated lease cost and cash paid for amounts included in the
measurement of lease liabilities for finance and operating leases for the years ended December 31, 2023 and
2022:
Lease cost:
Operating lease cost (1)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sublease income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance lease cost
2023
2022
$ 33.9
(1.7)
$ 47.7
(2.0)
Depreciation of finance lease assets (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest on finance lease liabilities (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
14.4
1.0
12.8
0.5
Total lease cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 47.6
$ 59.0
Other information:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash outflows from operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating cash outflows from finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financing cash outflows from finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(34.9)
$ (1.0)
$(15.7)
$(46.4)
$ (0.5)
$(14.3)
(1)
(2)
(3)
Included in “Cost of revenues” and “Selling, general and, administrative” expenses in our accompanying
consolidated statements of operations
Included in “Depreciation and amortization of fixed assets” in our accompanying consolidated statements of
operations
Included in “Interest expense” in our accompanying consolidated statements of operations
83
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents weighted-average remaining lease terms and weighted-average discount
rates for the consolidated finance and operating leases for the years ended December 31, 2023 and 2022:
Weighted-average remaining lease term — operating leases (in years) . . . . . . . . . . . . . .
Weighted-average remaining lease term — finance leases (in years) . . . . . . . . . . . . . . . .
Weighted-average discount rate — operating leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average discount rate — finance leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023
2022
8.5
1.7
8.2
3.1
4.0% 3.8%
4.2% 2.6%
Our ROU assets and lease liabilities for finance leases were $41.2 million and $34.5 million, respectively,
as of December 31, 2023. Our ROU assets and lease liabilities for finance leases were $10.7 million and
$4.2 million, respectively, as of December 31, 2022. Our ROU assets for finance leases were included in “Fixed
assets, net” in our accompanying consolidated balance sheets. Our lease liabilities for finance leases were
included in the “Short-term debt and current portion of long-term debt” and “Long-term debt” in our
accompanying consolidated balance sheets (See Note 15. Debt).
Maturities of the continuing lease liabilities for the years through 2029 and thereafter are as follows:
Years Ending
Operating
Leases
Finance
Leases
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2029 and thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 33.3
34.1
32.6
32.4
31.7
104.3
Total lease payments . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . .
Less: Amount representing interest
268.4
(39.7)
$15.6
13.8
3.4
2.6
1.7
—
37.1
(2.6)
Present value of total lease payments . . . . . . . . . . .
$228.7
$34.5
84
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
9. Fixed Assets
The following is a summary of fixed assets:
Useful Life
(in years)
Cost
Accumulated
Depreciation and
Amortization
December 31, 2023
Furniture and office equipment . . . . . . . . . . . . .
Leasehold improvements . . . . . . . . . . . . . . . . .
Purchased software . . . . . . . . . . . . . . . . . . . . . .
Software development costs . . . . . . . . . . . . . . .
Leased equipment . . . . . . . . . . . . . . . . . . . . . . .
Total fixed assets . . . . . . . . . . . . . . . . . . . .
December 31, 2022
Furniture and office equipment . . . . . . . . . . . . .
Leasehold improvements . . . . . . . . . . . . . . . . .
Purchased software . . . . . . . . . . . . . . . . . . . . . .
Software development costs . . . . . . . . . . . . . . .
Leased equipment . . . . . . . . . . . . . . . . . . . . . . .
Total fixed assets . . . . . . . . . . . . . . . . . . . .
3-10
Lease term
3
3-7
3-4
3-10
Lease term
3
3-7
3-4
$ 178.5
116.5
59.9
1,136.6
105.1
$1,596.6
$ 199.2
118.3
65.1
945.4
64.4
$1,392.4
$(156.7)
(63.0)
(55.2)
(653.0)
(63.8)
$(991.7)
$(177.1)
(54.6)
(61.0)
(504.5)
(53.7)
$(850.9)
Net
$ 21.8
53.5
4.7
483.6
41.3
$604.9
$ 22.1
63.7
4.1
440.9
10.7
$541.5
Depreciation and amortization of fixed assets for the years ended December 31, 2023, 2022, and 2021
were $206.8 million, $164.2 million, and $170.3 million, of which $165.5 million, $116.6 million, and
$111.6 million related to amortization of internal-use software development costs, respectively. Amortization
expense related to development of software for sale in accordance with ASC 985-20 was $4.8 million,
$7.6 million, and $11.7 million for the years ended December 31, 2023, 2022, and 2021, respectively. We had
unamortized software development costs that had been capitalized in accordance with ASC 350-40 of
$482.4 million and $389.1 million as of December 31, 2023 and 2022, respectively. We had unamortized
software development costs that had been capitalized in accordance with ASC 985-20 of $1.2 million and
$51.7 million as of December 31, 2023 and 2022, respectively. Leased assets include amounts held under
finance leases for automobiles, computer software, and computer equipment.
10. Acquisitions
2023 Acquisitions
On April 20, 2023, we acquired Krug Sachverständigen GmbH (“Krug”) for a net cash purchase price of
approximately $43.3 million including working capital adjustments, of which $3.8 million represents indemnity
escrows. Krug is a Germany-based motor claims solutions provider and has established an industry-leading
position in the German insurance market through highly digitalized solutions that help insurers and car
manufacturers achieve better and faster customer service, leading to sustainable reductions in costs. The
acquisition expands our claims and casualty offerings across Europe. Krug has become a part of our claims
category within our Insurance segment.
On February 1, 2023, we acquired 100 percent of the stock of Mavera Holding AB (“Mavera”) for a net
cash purchase price of $28.3 million, of which $4.2 million represents indemnity escrows. Mavera, a Sweden-
based InsurTech firm with a regional presence and established customer base for its personal injury claims
management platform, has become a part of the claims category within our Insurance segment. Mavera will
support our expansion in continental Europe and our continued growth as a technology and analytics partner to
the global insurance industry.
85
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The “Other” column includes other immaterial acquisitions that have occurred during the period. The
preliminary purchase price allocation of the 2023 acquisitions resulted in the following:
Krug
Other
Total
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities assumed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 7.0
1.8
3.8
0.2
—
15.1
33.1
61.0
5.8
—
4.8
0.1
10.7
50.3
7.0
$ 1.0
0.8
0.1
0.1
0.2
18.4
22.8
43.4
2.1
0.1
3.9
1.4
7.5
35.9
1.0
$
8.0
2.6
3.9
0.3
0.2
33.5
55.9
104.4
7.9
0.1
8.7
1.5
18.2
86.2
8.0
Net cash purchase price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$43.3
$34.9
$ 78.2
The preliminary amounts assigned to intangible assets by type for our 2023 acquisitions are summarized
in the table below:
Technology-based . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketing-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Customer-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
2
13
Total intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted Average
Useful Life
(in years)
Total
$ 9.9
0.5
23.1
$33.5
The preliminary allocations of the purchase price for the 2023 and 2022 acquisitions with less than a year
of ownership are subject to revisions as additional information is obtained about the facts and circumstances that
existed as of each acquisition date. The revisions may have a significant impact on our consolidated financial
statements. The allocations of the purchase price will be finalized once all the information that was known as of
the acquisition date is obtained and analyzed, but not to exceed one year from the acquisition date. The primary
areas of the purchase price allocation that are not yet finalized relate to income and non-income taxes, deferred
revenues, the valuation of intangible assets acquired, and residual goodwill. The goodwill associated with our
acquisitions includes the acquired assembled workforce, the value associated with the opportunity to leverage the
work force to continue to develop the technology and content assets, as well as our ability to grow through
adding additional customer relationships or new solutions in the future. The $55.9 million in goodwill associated
with our acquisitions, is not deductible for tax purposes. The preliminary amounts assigned to intangible assets
by type for these acquisitions were based upon our valuation model and historical experiences with entities with
similar business characteristics.
86
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
For the year ended December 31, 2023, we incurred transaction costs of $2.5 million. The transaction
costs were included within “Selling, general and administrative” expenses in our accompanying consolidated
statements of operations.
Our 2023 acquisitions were not significant, both individually and in the aggregate, to our consolidated
financial statements for the years ended December 31, 2023, 2022, and 2021, and therefore, supplemental
information disclosure on an unaudited pro forma basis is not presented.
2022 Acquisitions
On March 1, 2022, we acquired 100 percent of the stock of Opta Information Intelligence Corp. (“Opta”)
for a net cash purchase price of $217.5 million excluding working capital adjustments, of which $0.8 million
represents indemnity escrows. Opta, a leading provider of property intelligence and innovative technology
solutions in Canada, has become a part of the underwriting category within our Insurance segment. We believe
this acquisition further expands our footprint in the Canadian market and supports Verisk in reshaping risk
management with valuable business intelligence.
On February 11, 2022, we acquired 100 percent of the membership interest of Infutor Data Solutions,
LLC (“Infutor”) for a net cash purchase price of $220.7 million excluding working capital adjustments, of which
$1.5 million represents a working capital escrow, plus a contingent earn-out payment of up to $25.0 million
subject to the achievement of certain revenue and other performance targets. Infutor, a leading provider of
identity resolution and consumer intelligence data, has become a part of the underwriting category within our
Insurance segment. We believe this acquisition further enhances Verisk’s marketing solutions offerings to
companies across several industries, including the insurance industry.
87
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The final purchase price allocations, inclusive of closing adjustments, of our 2022 acquisitions resulted in
the following:
Opta
Infutor
Others
Total
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net
. . . . . . . . . . . . . . . . . .
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities assumed . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
0.4
5.2
1.3
1.5
1.1
87.0
141.1
—
237.6
4.9
0.2
1.1
13.5
—
19.7
Net assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
217.9
Less: Cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.4
$ 17.0
10.7
3.8
0.9
2.3
83.4
140.3
0.1
258.5
14.4
3.1
3.3
—
—
20.8
237.7
17.0
$ — $ 17.4
15.9
5.2
2.7
3.4
172.7
284.4
0.1
—
0.1
0.3
—
2.3
3.0
—
5.7
0.1
0.1
—
0.5
0.2
0.9
4.8
—
501.8
19.4
3.4
4.4
14.0
0.2
41.4
460.4
17.4
Net cash purchase price . . . . . . . . . . . . . . . . . . . . . . . . . .
$217.5
$220.7
$4.8
$443.0
The final amounts assigned to intangible assets by type for our 2022 acquisitions are summarized in the
table below:
Technology-based . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketing-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Customer-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6
4
13
Total intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted Average
Useful Life
(in years)
Total
$ 48.5
2.0
122.2
$172.7
For the year ended December 31, 2023, we finalized the purchase accounting for our 2022 acquisitions
during the measurement periods in accordance with ASC 805, Business Combinations (“ASC 805”). The impact
of finalization of the purchase accounting associated with these acquisitions was not material to our
accompanying consolidated financial statements for the years ended December 31, 2023 and 2022.
Of the $284.4 million in goodwill associated with our acquisitions, $144.5 million is not deductible for
tax purposes. The preliminary amounts assigned to intangible assets by type for these acquisitions were based
upon our valuation model and historical experiences with entities with similar business characteristics. For the
year ended December 31, 2022, we incurred transaction costs related to acquisitions of $1.8 million, which are
included within “Selling, general and administrative” expenses in our accompanying consolidated statements of
operations. Refer to Note 12. Goodwill and Intangible Assets for further discussion.
88
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Our 2022 acquisitions were not significant, both individually and in the aggregate, to our consolidated
financial statements for the years ended December 31, 2022 and 2021, and therefore, supplemental information
disclosure on an unaudited pro forma basis is not presented.
2021 Acquisitions
On December 23, 2021, we acquired approximately 96.7 percent of the stock of ACTINEO GmbH
(“ACTINEO”) with an option to acquire the remaining shares at a future date, for a net cash purchase price of
$148.9 million. ACTINEO offers a comprehensive portfolio of services, technology and data solutions to support
the entire bodily injury settlement process. With this acquisition, we add ACTINEO’s established claims
management solutions to our leading data analytics and insurance ecosystem, providing customers with
digitalization and medical expertise solutions throughout the entire claims process. ACTINEO is part of the
claims vertical within our Insurance segment.
On November 2, 2021, we acquired 100 percent of the stock of Data Driven Safety, LLC (“Data Driven
Safety”) for a net cash purchase price of $93.5 million, of which $2.0 million represents indemnity escrows. Data
Driven Safety, a leading public record data aggregation firm that specializes in driver risk assessment in the U.S.,
has become a part of the underwriting category within our Insurance segment. We believe that Data Driven
Safety will expand our robust auto insurance analytics, providing insurers with information to further refine
underwriting, improve the customer experience and promote public safety.
On September 1, 2021, we acquired 100 percent of the stock of Ignite Software Systems Limited
(“Ignite”) for a net cash purchase price of $13.8 million. Ignite, a provider of insurance policy administration
systems to brokers, managing general agents, and insurers, has become a part of the underwriting category within
our Insurance segment. We believe that Ignite’s client focus and deep domain knowledge will fit into our
business model providing new and existing clients with access to a broader expert advice and service.
On June 17, 2021, we acquired 100 percent of the stock of Roskill Holdings Limited (“Roskill”) for a net
cash purchase price of $22.1 million, of which $4.8 million represents indemnity escrows. Roskill, a provider of
metals and materials supply chain intelligence, was part of our Energy and Specialized Markets segment.
Roskill’s capabilities reinforce our ability to provide comprehensive analysis across the energy, and metals and
mining value chain while adding analysis, data, and insight on battery raw materials metals. This acquisition was
excluded from the table below due to the announcement of the sale of our Energy business.
On March 2, 2021, we acquired a 51.0 percent ownership in Whitespace Software Limited
(“Whitespace”) for a net cash purchase price of $16.8 million. The remaining 49.0 percent ownership interest in
Whitespace will be acquired by us, in three equal proportions over the next three years, at a purchase price
determined based upon a fixed revenue multiple and adjusted for any free cash flow shortfall. Whitespace, a
provider of digital placing technology to the (re)insurance market, has become part of the underwriting category
within our Insurance segment. We expect our investment in Whitespace to enable a seamless real-time
quote-to-bind electronic placing and global distribution solution, with straight-through submissions for our
customers.
89
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The final purchase price allocations, inclusive of closing adjustments, of our 2021 acquisitions resulted in
the following:
ACTINEO
Data Driven
Safety
Others
Total
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net . . . . . . . . . . . . . .
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
0.2
1.8
—
1.4
4.2
48.3
121.9
—
$
2.5
1.0
2.0
—
0.4
42.1
74.1
—
Total assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . .
177.8
122.1
Current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax, net . . . . . . . . . . . . . . . . . . . . . . . . .
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities assumed . . . . . . . . . . . . . . . . . . . . . . .
2.1
—
4.2
15.8
—
22.1
Net assets acquired . . . . . . . . . . . . . . . . . . . . . . . . . . .
155.7
Less: Noncontrolling interests . . . . . . . . . . . . . . . . . . . .
Cash acquired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.6
0.2
2.7
0.4
0.4
—
21.7
25.2
96.9
—
3.4
$ 3.7
1.4
1.0
0.1
1.3
19.0
39.6
0.1
66.2
1.7
1.4
1.4
3.7
—
8.2
58.0
19.8
3.7
$
6.4
4.2
3.0
1.5
5.9
109.4
235.6
0.1
366.1
6.5
1.8
6.0
19.5
21.7
55.5
310.6
26.4
7.3
Net cash purchase price . . . . . . . . . . . . . . . . . . . . . .
$148.9
$ 93.5
$34.5
$276.9
The final amounts assigned to intangible assets by type for our 2021 acquisitions are summarized in the
table below:
Technology-based . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Marketing-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Customer-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Database-related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5
3
13
6
Total intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted Average
Useful Life
(in years)
Total
$ 21.1
1.1
81.2
6.0
$109.4
For the year ended December 31, 2022, we finalized the purchase accounting for our 2021 acquisitions
during the measurement periods in accordance with ASC 805. The impact of finalization of the purchase
accounting associated with these acquisitions was not material to our accompanying financial statements for the
year ended December 31, 2021.
Of the $235.6 million in goodwill associated with our acquisitions, $161.3 million is not deductible for
tax purposes. The preliminary amounts assigned to intangible assets by type for these acquisitions were based
upon our valuation model and historical experiences with entities with similar business characteristics. For the
year ended December 31, 2021, we incurred transaction costs related to acquisitions of $2.8 million, which are
90
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
included within “Selling, general and administrative” expenses in our accompanying consolidated statements of
operations. Refer to Note 12. Goodwill and Intangible Assets for further discussion.
Our 2021 acquisitions were not significant and therefore, supplemental information disclosure on an
unaudited pro forma basis is not presented.
Acquisition Escrows and Related Liabilities
Pursuant to the related acquisition agreements, we have funded various escrow accounts to satisfy
pre-acquisition indemnity and tax claims arising subsequent to the acquisition dates, as well as a portion of the
contingent payment. During the years ended December 31, 2023 and 2022, we released $0.0 million and
$12.8 million of indemnity escrows related to various acquisitions. At December 31, 2023 and 2022, the current
portion of the escrows amounted to $3.9 million and $0.0 million. There were no noncurrent portions of the
escrows. The current and noncurrent portions of the escrows have been included in “Other current assets” and
“Other noncurrent assets” in our accompanying consolidated balance sheets, respectively.
The acquisitions of Infutor Data Solutions, LLC, Krug, Mavera, and Morning Data Limited included
acquisition-related contingent payments, for which the sellers of these acquisitions could receive additional
payments by achieving the specific predetermined revenue, EBITDA, and EBITDA margin earn-out targets for
exceptional performance. We believe that the liabilities recorded as of December 31, 2023 and 2022 reflect the
best estimate of acquisition-related contingent payments. The associated current portion of contingent
payments were $10.0 million and $29.9 million as of December 31, 2023 and 2022, respectively. The associated
noncurrent portion of contingent payments were $2.1 million and $0.0 million as of December 31, 2023 and
2022, respectively.
11. Dispositions and Discontinued Operations:
Discontinued Operations
On February 1, 2023, we completed the sale of our Energy business to Planet Jersey Buyer Ltd, an entity
that was formed on behalf of, and is controlled by, The Veritas Capital Fund VIII, L.P. and its affiliated funds
and entities (“Veritas Capital”), for a net cash sale price of $3,066.4 million paid at closing (reflecting a base
purchase price of $3,100.0 million, subject to customary purchase price adjustments for, among other things, the
cash, working capital, and indebtedness of the companies as of the closing) and up to $200.0 million of additional
contingent cash consideration based on Veritas Capital’s future return on its investment paid through a Class C
Partnership interest.
The Energy business, which was part of our Energy and Specialized Markets segment, was classified as
discontinued operations per ASC 205-20 as we determined, qualitatively and quantitatively, that this transaction
represented a strategic shift that had a major effect on our operations and financial results. Accordingly, all
results of the Energy business have been removed from continuing operations and presented as discontinued
operations in our consolidated statements of operations for all periods presented. Additionally, all assets and
liabilities of the Energy business were classified as assets and liabilities held for sale within our consolidated
balance sheet as of December 31, 2022. In connection with the held for sale classification, we recognized an
impairment of $303.7 million on the remeasurement of the disposal group held for sale, which has been included
in discontinued operations in our consolidated statement of operations. Upon classification of the Energy
business as held for sale, its cumulative foreign currency translation adjustment within shareholders’ equity
was included with its carrying value, which primarily resulted in the impairment. When we closed on the sale of
our Energy business on February 1, 2023, we recognized a loss of $128.4 million. As a result of closing
adjustments in the second and fourth quarter of 2023, we incurred an additional net loss of $2.7 million.
91
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents the financial results from discontinued operations, net of income taxes in our
consolidated statement of income for the periods indicated:
Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses:
For the Year Ended
December 31,
2023
2022
2021
$ 46.8
$ 537.3
$536.1
Cost of revenues (exclusive of items shown separately below) . .
Selling, general and administrative . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization of fixed assets . . . . . . . . . . . . . . . .
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other operating loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . .
18.2
33.2
—
—
—
131.1
182.5
207.4
117.2
32.9
68.5
303.7
33.9
763.6
Operating (loss) income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(135.7)
(226.3)
204.1
109.5
36.6
96.8
—
—
447.0
89.1
Other income (expense):
Investment income (loss) and others, net
. . . . . . . . . . . . . . . . . . .
Total other income (expense), net . . . . . . . . . . . . . . . . . . . . .
(5.7)
(5.7)
7.0
7.0
(0.2)
(0.2)
(Loss) income from discontinued operations before income
taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income tax (expense) benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(141.4)
(12.6)
(219.3)
131.5
88.9
(29.7)
(Loss) income from discontinued operations, net of income
taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(154.0)
$ (87.8)
$ 59.2
92
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents the aggregate carrying amounts of the held for sale assets and liabilities
of the Energy business in the consolidated balance sheet as of the date indicated:
February 1,
2023
December 31,
2022
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts receivable, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
86.3
187.1
17.6
13.8
Total current assets:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intangible assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net impairment of asset group(1)
Total assets held for sale: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
304.8
165.2
29.7
625.9
2,165.7
18.9
3,005.4
3,310.2
(227.8)
$ 180.2
150.8
17.8
13.8
362.6
157.1
29.8
616.9
2,136.3
16.3
2,956.4
3,319.0
(227.8)
Total assets held for sale, net . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$3,082.4
$3,091.2
Accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Current liabilities held-for-sale: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred income tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other noncurrent liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent liabilities held-for-sale . . . . . . . . . . . . . . . . . . . . . . . . . . .
77.6
7.6
207.4
13.6
306.2
146.2
30.0
2.5
178.7
$
68.6
6.9
176.6
30.2
282.3
144.1
30.8
2.7
177.6
Total liabilities held for sale . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 484.9
$ 459.9
(1)
In connection with the held for sale classification, we recognized a $303.7 million impairment, partially
offset by a deferred tax benefit of $75.9 million on the remeasurement of the disposal group held for sale.
This impairment was charged to a contra asset account within “Other noncurrent assets” per ASC 205-20,
Discontinued Operations.
93
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The consolidated statements of cash flows have not been adjusted to separately disclose cash flows
related to discontinued operations. The following table presents selected cash flow information associated with
our discontinued operations:
For the Year Ended
December 31,
2023
2022
2021
Significant non-cash operating activities:
Depreciation and amortization of fixed assets . . . . . . . . . . . . . . . . . . .
Amortization of intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating lease right-of-use assets, net . . . . . . . . . . . . . . . . . . . . . . . .
$ — $ 32.9
68.5
303.7
7.6
—
—
0.1
$ 36.6
96.8
—
7.7
Investing activities:
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(6.5)
(72.6)
(59.7)
Supplemental disclosures:
Fixed assets included in accounts payable and accrued liabilities . . .
—
3.0
5.0
12. Goodwill and Intangible Assets:
The following is a summary of the change in goodwill from January 1, 2022 through December 31, 2023,
both in total and as allocated to our reportable segments:
Insurance
Specialized
Markets
Financial
Services
Goodwill at January 1, 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase accounting reclassifications . . . . . . . . . . . . . . . . . . . . . . . . .
Disposition of sold businesses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment Charge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . .
$1,454.8
284.4
(0.5)
$ 117.4
—
—
— (116.5)
—
—
(0.9)
(62.7)
$ 475.4
—
—
(473.2)
(1.7)
(0.5)
Total
$2,047.6
284.4
(0.5)
(589.7)
(1.7)
(64.1)
Goodwill at December 31, 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,676.0
Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase accounting reclassifications . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . .
55.9
(0.1)
29.0
—
—
—
—
— 1,676.0
—
—
—
55.9
(0.1)
29.0
Goodwill at December 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,760.8
$ — $ — $1,760.8
Goodwill and intangible assets with indefinite lives are subject to impairment testing annually as of
June 30, or whenever events or changes in circumstances indicate that the carrying amount may not be fully
recoverable. When evaluating goodwill for impairment, we may decide to first perform a qualitative assessment,
or “Step Zero” impairment test, to determine whether it is more likely than not that impairment has occurred. The
qualitative assessment includes a review of macroeconomic conditions, industry and market considerations,
internal cost factors, and our own overall financial and share price performance, among other factors. If we do
not perform a qualitative assessment, or if we determine that it is more likely than not that the carrying amount of
our reporting units exceeds their fair value, we perform a quantitative assessment and calculate the estimated fair
value of the respective reporting unit. If the carrying amount of a reporting unit’s goodwill exceeds the fair value
of that goodwill, an impairment loss is recognized. As of June 30, 2023, we completed our Step Zero impairment
test at the reporting unit level and determined it was not more likely than not that the carrying values of our
reporting units exceeded their fair values. We did not recognize any impairment charges related to our goodwill
94
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
and indefinite-lived intangible assets. Subsequent to performing the test we continued to monitor these reporting
units for events that would trigger an interim impairment test; we did not identify any such events.
Impairments to long-lived assets for the twelve months ended December 31, 2023 and 2022 were
$0.0 million and $73.7 million, respectively, and are included within “Other operating (income) loss, net” in
our consolidated statements of operations.
Our intangible assets and related accumulated amortization consisted of the following:
December 31, 2023
Technology-based . . . . . . . . . . . . . . . . . . . .
Marketing-related . . . . . . . . . . . . . . . . . . . . .
Contract-based . . . . . . . . . . . . . . . . . . . . . . .
Customer-related . . . . . . . . . . . . . . . . . . . . .
Database-based . . . . . . . . . . . . . . . . . . . . . .
Total intangible assets . . . . . . . . . . . . . . .
December 31, 2022
Technology-based . . . . . . . . . . . . . . . . . . . .
Marketing-related . . . . . . . . . . . . . . . . . . . . .
Contract-based . . . . . . . . . . . . . . . . . . . . . . .
Customer-related . . . . . . . . . . . . . . . . . . . . .
Database-based . . . . . . . . . . . . . . . . . . . . . .
Total intangible assets . . . . . . . . . . . . . . .
Weighted
Average
Useful Life
(in years)
Cost
Accumulated
Amortization
Net
8
6
6
13
8
8
6
6
13
8
$370.2
42.7
5.0
542.1
15.2
$975.2
$355.1
41.3
5.0
510.7
15.0
$927.1
$(261.2)
(38.7)
(5.0)
(190.7)
(7.9)
$(503.5)
$(229.3)
(35.5)
(5.0)
(146.7)
(5.8)
$(422.3)
$109.0
4.0
—
351.4
7.3
$471.7
$125.8
5.8
—
364.0
9.2
$504.8
Amortization expense related to intangible assets for the years ended December 31, 2023, 2022, and
2021, was $74.6 million, $74.4 million, and $80.0 million, respectively. Estimated amortization expense in future
periods through 2029 and thereafter for intangible assets subject to amortization is as follows:
Years Ending
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2029 and thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount
$ 72.2
63.1
61.1
52.8
45.7
176.8
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$471.7
95
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
13.
Income Taxes:
Domestic and foreign income before income taxes was as follows:
U.S. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,021.9
5.3
$1,277.1
(14.7)
$784.1
2.4
Total income before income taxes . . . . . . . . . . . . . . . . . . . . . . .
$1,027.2
$1,262.4
$786.5
2023
2022
2021
The components of the provision for income taxes for the years ended December 31 were as follows:
2023
2022
2021
Current:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal
State and local
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$226.8
52.0
9.0
$247.8
64.7
1.1
$123.8
19.5
3.0
Total current provision for income taxes . . . . . . . . . . . . . . . . . . . . .
287.8
313.6
146.3
Deferred:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State and local
Foreign . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total deferred provision for income taxes . . . . . . . . . . . . . . . . . . . .
(23.4)
(3.4)
(2.2)
(29.0)
(43.3)
(11.2)
(38.8)
(93.3)
20.6
10.5
2.0
33.1
Provision for income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$258.8
$220.3
$179.4
The reconciliation between our effective tax rate and the statutory tax rate is as follows for the years
ended December 31:
Federal statutory rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State and local taxes, net of federal tax benefit . . . . . . . . . . . . . . . . . . . . . . . .
Impact of dispositions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
UK valuation allowance release . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Global Intangible Low-taxed Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Stock-based compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023
2022
2021
21.0% 21.0% 21.0%
3.7
2.8
3.4
— (3.0) —
— (2.4) —
0.4
1.3
2.6
(3.5)
(1.7)
(1.8)
(0.1)
(0.2)
1.0
Effective tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25.2% 17.5% 22.8%
The increase in the effective tax rate in 2023 compared to 2022 was primarily due to tax rate benefits in
2022 related to the sale of 3E and a release of a United Kingdom valuation allowance associated with interest
expense utilization. In addition, the tax rate for 2023 was higher than the prior year due to tax charges incurred in
structuring the Energy sale in the first quarter, which are reflected in the Global Intangible Low-taxed Income
and Other lines above. Also included in the “Other” line above is the unfavorable impact of the litigation reserve
expense of $38.2 million associated with an indemnification of an ongoing inquiry related to our former
Financial Services segment that is anticipated to be mostly non-deductible.
96
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The tax effects of significant items comprising our deferred tax assets and liabilities as of December 31
are as follows:
Deferred tax assets:
Employee wages and other benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net operating loss carryover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Book/tax energy basis difference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less valuation allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred tax liabilities:
Right of use assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fixed assets and intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pensions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2023
2022
$ 49.9
55.4
9.4
31.0
—
17.1
162.8
(5.6)
157.2
(48.3)
(194.1)
(18.2)
(57.0)
(18.9)
$ 54.9
53.3
12.0
31.1
112.2
22.0
285.5
(45.3)
240.2
(44.1)
(223.9)
(16.8)
(56.5)
(12.8)
Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(336.5)
(354.1)
Deferred tax liabilities, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(179.3)
$(113.9)
The net deferred tax liabilities of $179.3 million consist primarily of timing differences involving
amortization.
Our net operating loss carryforwards expire as follows:
Years Ending
2024-2031 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2032-2036 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2037-2043 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount
$20.5
11.5
37.0
$69.0
A valuation allowance has been established based on our evaluation of the likelihood of utilizing these
benefits before they expire. Other than these items, we have determined, based on our historical operating
performance, that our taxable income will more likely than not be sufficient to fully realize the deferred tax
assets.
As of December 31, 2023, we have not made a provision for U.S. or additional foreign withholding taxes
for any additional outside basis difference inherent in our foreign subsidiaries, as these amounts continue to be
indefinitely reinvested in foreign operations. Determining the amount of unrecognized deferred tax liability
related to any additional outside basis difference in these entities is not practicable. We do not rely on these
unremitted earnings as a source of funds for our domestic business as we expect to have sufficient cash flow in
the U.S. to fund our U.S. operational and strategic needs.
97
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
We follow ASC 740-10 which prescribes a comprehensive model for the financial statement recognition,
measurement, presentation, and disclosure of uncertain tax positions taken or expected to be taken in income tax
returns. For each tax position, we must determine whether it is more likely than not that the position will be
sustained upon examination based on the technical merits of the position, including resolution of any related
appeals or litigation. A tax position that meets the more likely than not recognition threshold is then measured to
determine the amount of benefit to recognize within the financial statements. No benefits may be recognized for
tax positions that do not meet the more likely than not threshold. A reconciliation of the beginning and ending
amount of unrecognized tax benefit is as follows:
Unrecognized tax benefit as of January 1 . . . . . . . . . . . . . . . . . . . .
Gross increase in tax positions in prior period . . . . . . . . . . . . .
Gross decrease in tax positions in prior period . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Lapse of statute of limitations . . . . . . . . . . . . . . . . . . . . . . . . .
2023
2022
2021
$ 3.2
0.8
—
—
(2.0)
$ 9.9
$ 3.4
1.0
1.3
— (0.1)
—
(7.7)
(0.6)
(0.6)
Unrecognized tax benefit as of December 31 . . . . . . . . .
$ 2.0
$ 3.2
$ 3.4
All unrecognized tax benefits as of December 31, 2023, 2022, and 2021 would have a favorable impact
on our effective tax rate if recognized in any future periods.
The total gross amount of accrued interest and penalties for the years ended December 31, 2023, 2022,
and 2021 was $0.2 million, $0.4 million, and $0.5 million, respectively. Our practice is to recognize interest and
penalties associated with income taxes as a component of “Provision for income taxes” in our accompanying
consolidated statements of operations.
We do not expect a significant change in unrecognized benefits related to federal, state, or foreign tax
exposures within the coming year. In addition, we believe that it is reasonably possible that approximately
$0.7 million of our currently remaining unrecognized tax positions, each of which is individually insignificant,
may be recognized by the end of 2024 as a result of a combination of audit settlements and lapses of statute of
limitations, net of additional uncertain tax positions.
We are subject to tax in the U.S., various state, and foreign jurisdictions, and are routinely under audit by
various tax authorities. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-US
income tax examinations by tax authorities for tax years before 2019. We do not expect the results of
current examinations to have a material effect on our financial position, results of operations, or cash flow.
14. Composition of Certain Financial Statement Caption:
The following table presents the components of “Accounts payable and accrued liabilities” as of
December 31:
Accounts payable and accrued liabilities:
Accrued salaries, benefits and other related costs . . . . . . . . . . . . . . . . . . . . .
Escrow liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Trade accounts payable and other accrued expenses . . . . . . . . . . . . . . . . . .
Acquisition-related liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$149.4
3.9
19.1
158.4
10.0
$117.4
0.4
16.3
128.7
30.0
Total accounts payable and accrued liabilities . . . . . . . . . . . . . . . . . . .
$340.8
$292.8
2023
2022
98
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents the components of “Other noncurrent assets” as of December 31:
Other noncurrent assets:
Pension benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other assets — prepaid expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments in nonpublic companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State income tax receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deposits and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total other noncurrent assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$121.4
73.2
231.4
67.7
2.4
$496.1
$ 89.0
50.7
229.8
—
1.9
$371.4
2023
2022
15. Debt:
The following table presents short-term and long-term debt by issuance as of December 31:
Short-term debt and current portion of long-term debt:
Credit Facilities:
Syndicated revolving credit facility . . . . . . . . . . . . . . . . . . . . . .
Bilateral revolving credit facility . . . . . . . . . . . . . . . . . . . . . . . .
Bilateral term loan facility . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Finance lease liabilities (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term debt and current portion of long-term debt
. . . . .
Long-term debt:
Senior notes:
Issuance
Date
Maturity
Date
2023
2022
Various
Various
Various
Various
$
Various
Various
Various
Various
— $ 990.0
275.0
—
125.0
—
2.9
14.5
14.5
1,392.9
3.625% senior notes, less unamortized discount and debt
issuance costs of $(9.6) and $(10.0), respectively . . . . . . .
4.125% senior notes, inclusive of unamortized premium, and
net of unamortized discount and debt issuance costs of
$7.8 and $9.4, respectively . . . . . . . . . . . . . . . . . . . . . . . . .
4.000% senior notes, less unamortized discount and debt
5/13/2020
5/15/2050
490.4
490.0
3/6/2019
3/15/2029
607.8
609.4
issuance costs of $(1.8) and $(2.8), respectively . . . . . . . .
5/15/2015
6/15/2025
898.2
897.2
5.500% senior notes, less unamortized discount and debt
issuance costs of $(3.8) and $(4.0), respectively . . . . . . . .
5/15/2015
6/15/2045
346.2
346.0
5.750 senior notes, less unamortized discount and debt
issuance costs of $(8.9) and $0, respectively . . . . . . . . . . .
Finance lease liabilities (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Syndicated revolving credit facility debt issuance costs . . . . . .
3/3/2023
Various
Various
4/1/2033
Various
Various
491.1
20.0
(1.5)
—
1.3
(0.7)
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total debt
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,852.2
2,343.2
$2,866.7
$3,736.1
(1) Refer to Note 8. Leases
Accrued interest associated with our outstanding debt obligations was $19.1 and $16.3 million as
of December 31, 2023 and 2022, respectively, and included in “Accounts payable and accrued liabilities” within
our accompanying consolidated balance sheets. Interest expense associated with our finance lease and
outstanding debt obligations, including amortization of debt issuance costs and original discounts, was
$131.3 million, $135.5 million, and $127.0 million for the years ended December 31, 2023, 2022, and 2021,
respectively.
99
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Senior Notes
As of December 31, 2023 and December 31, 2022, we had senior notes with an aggregate principal
amount of $2,850.0 million outstanding, and were in compliance with our financial and other debt covenants.
On March 3, 2023, we completed an issuance of $500.0 million aggregate principal amount of 5.75%
senior notes due in 2033 (the “2033 Senior Notes”). The 2033 Senior Notes mature on April 1, 2033 and accrue
interest at a fixed rate of 5.75% per annum. Interest is payable semiannually on April 1st and October 1st of each
year, beginning October 1, 2023. The 2033 Senior Notes were issued at a discount of $4.7 million and we
incurred debt issuance costs of $5.5 million. The original issuance discount and debt issuance costs were
recorded in “Long-term debt” in the accompanying condensed consolidated balance sheets and these costs will be
amortized to “Interest expense” in the accompanying consolidated statements of operations over the life of the
2033 Senior Notes. The net proceeds from the issuance of the 2033 Senior Notes were utilized to partially repay
the Syndicated Revolving Credit Facility and for general corporate purposes. The indenture governing the 2033
Senior Notes restricts our ability to, among other things, create certain liens, enter into sale/leaseback
transactions and consolidate with, sell, lease, convey or otherwise transfer all or substantially all of our assets, or
merge with or into, any other person or entity.
Credit Facilities
We have a syndicated revolving credit facility (“Syndicated Revolving Credit Facility”) with a borrowing
capacity of $1,000.0 million with Bank of America N.A., HSBC Bank USA, N.A., JP Morgan Chase Bank, N.A.,
Wells Fargo Bank, National Association, Citibank, N.A., Morgan Stanley Bank, N.A., TD Bank, N.A., Goldman
Sachs Bank USA, and the Northern Trust Company. The Syndicated Revolving Credit Facility may be used for
general corporate purposes, including working capital needs and capital expenditures, acquisitions, dividend
payments, and the share repurchase program (the “Repurchase Program”). As of December 31, 2023, we were in
compliance with all financial and other debt covenants under our Syndicated Revolving Credit Facility. As of
December 31, 2023 and 2022, the available capacity under the Syndicated Revolving Credit Facility was
$995.4 million and $5.6 million, which takes into account outstanding letters of credit of $4.6 million and
$4.4 million, respectively.
On April 5, 2023, we entered into the Fifth Amendment (the “Amendment”) to the committed senior
unsecured Syndicated Revolving Credit Facility with Bank of America, N.A. as administrative agent. The
Amendment does not change the current borrowing capacity of $1,000.0 million, but does extend the maturity
date to April 5, 2028. Interest on borrowings under the Amendment is payable at an interest rate of SOFR plus
100.0 to 162.5 basis points, depending upon our public debt rating. A commitment fee on any unused
commitment is payable periodically and may range from 8.0 to 17.5 basis points based upon our public debt
rating. The Syndicated Revolving Credit Facility, as amended by the Amendment, also contains certain financial
and other covenants that, among other things, impose certain restrictions on indebtedness, liens, investments, and
capital expenditures. These covenants place restrictions on mergers, asset sales, sale/leaseback transactions, and
certain transactions with affiliates. The financial covenants require that, at the end of any fiscal quarter, we have
a consolidated funded debt leverage ratio of less than 3.75 to 1.0. At our election, the maximum consolidated
funded debt leverage ratio could be permitted to increase to 4.50 to 1.0 (no more than once) and to 4.25 to 1.0 (no
more than once) in connection with the closing of a permitted acquisition. The Syndicated Revolving Credit
Facility may be used for general corporate purposes, including working capital needs and capital expenditures,
acquisitions, dividend payments, and the Repurchase Program. In connection with the Amendment, we incurred
additional debt issuance costs of $1.2 million, which will be amortized to “Interest expense” within the
accompanying consolidated statements of operations over the remaining life of the Credit Facility.
100
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
We also maintained a $125.0 million Bilateral Term Loan Facility and a $275.0 million Bilateral Credit
Facility (together the “Bilateral Credit Facilities”) that matured on September 9, 2023 and October 2, 2023,
respectively. The Bilateral Credit Facilities carried an interest rate of 135 basis points plus the one-month BSBY
and were used for general corporate purposes, including working capital needs and capital expenditures,
acquisitions, dividend payments, and the Repurchase Program. We have had no outstanding borrowings under
our Bilateral Credit Facilities during 2023 through the maturity dates. The Bilateral Credit Facilities have not
been renewed.
Debt Maturities
The following table reflects our debt maturities:
Years Ending
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2029 and thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amount
$
14.4
913.3
2.9
2.3
1.4
1,950.0
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,884.3
16. Stockholders’ Equity:
We have 2,000,000,000 shares of authorized common stock as of December 31, 2023 and 2022. The
common shares have rights to any dividend declared by our Board of Directors, subject to any preferential or
other rights of any outstanding preferred stock, and voting rights to elect all eleven members of our Board of
Directors. At December 31, 2023, 2022, and 2021, the adjusted closing price of our common stock was $238.86,
$176.42, and $228.73 per share, respectively.
We have 80,000,000 shares of authorized preferred stock, par value $0.001 per share. The preferred
shares have preferential rights over the common shares with respect to dividends and net distribution upon
liquidation. We did not issue any preferred shares as of December 31, 2023 and 2022.
On February 14, 2023, April 25, 2023, July 26, 2023, and October 25, 2023, our board approved a cash
dividend of $0.34 per share of common stock issued and outstanding to the holders of record as of March 15,
2023, June 15, 2023, September 15, 2023, and December 15, 2023, respectively. Cash dividends of
$196.8 million and $195.2 million were paid during the years ended December 31, 2023 and 2022, and recorded
as a reduction to retained earnings, respectively.
Share Repurchase Program
In December 2022 and March 2023, we entered into Accelerated Share Repurchase (“ASR”) agreements
(the “December 2022 ASR Agreement” and “March 2023 ASR Agreement,” respectively) to repurchase shares
of our common stock for an aggregate purchase price of $250.0 million and $2.5 billion, respectively, with Bank
of America, N.A., with respect to the December 2022 ASR agreement and Citibank, N.A., and Goldman Sachs &
Co. LLC with respect to the March 2023 ASR agreements. Each ASR agreement is accounted for as a treasury
stock transaction and forward stock purchase agreement indexed to our common stock. The forward stock
purchase agreement is classified as an equity instrument under ASC 815-40, Contracts in Entity’s Own
101
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Equity (“ASC 815-40”) and deemed to have a fair value of zero at the respective effective date. Upon payment of
the aggregate purchase prices on December 14, 2022 and March 7, 2023, we received initial deliveries of an
aggregate of 1,168,224 and 10,655,301 shares of our common stock, respectively. Upon the final settlement of
the ASR agreements in February 2023 and December 2023, we received additional shares of 247,487 and
865,232, respectively, as determined based on the volume weighted average share price of our common stock of
$176.68 and $217.00, respectively, during the terms of the ASR agreements, minus an agreed upon discount. The
aggregate purchase price was recorded as a reduction to stockholders’ equity in our consolidated statements of
changes in stockholders’ equity for the year ended December 31, 2023. These repurchases for the year ended
December 31, 2023 resulted in a reduction of outstanding shares used to calculate the weighted average common
shares outstanding for basic and diluted earnings per share (“EPS”).
In December 2023, we entered into an additional ASR agreement to repurchase shares of our common
stock for an aggregate purchase price of $250.0 million with Goldman Sachs & Co. LLC. The ASR agreement is
accounted for as a treasury stock transaction and a forward stock purchase agreement indexed to our common
stock. Upon the payment of the aggregate purchase price of $250.0 million on December 14, 2023, we received
873,479 shares of our common stock at an initial price of $243.28 per share, representing an initial delivery of
approximately 85 percent of the aggregate purchase price. Upon the final settlement of this ASR agreement in
February 2024, we received 178,227 additional shares as determined by the daily volume weighted average share
price of our common stock of $237.71 during the term of this ASR agreement.
For the year ended December 31, 2023, we repurchased 12,849,921 shares of common stock as part of the
Repurchase Program, inclusive of the ASRs and open market repurchases, at a weighted average price of
$219.96 per share. We utilized cash received from the sale of our Energy business. As of December 31, 2023, we
had $641.5 million available to repurchase shares through our Repurchase Program, inclusive of the $3.0 billion
authorization to repurchase shares of our common stock.
Treasury Stock
As of December 31, 2023, our treasury stock consisted of 400,694,309 shares of common stock. During
the years ended December 31, 2023, 2022, and 2021, we transferred 1,457,514, 1,650,460, and 1,379,304 shares
of common stock, from the treasury shares at a weighted average price of $19.50, $14.25, and $11.78 per share,
respectively.
102
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Earnings Per Share
The following is a reconciliation of the numerators and denominators of our basic and diluted EPS
computations for the years ended December 31:
2023
2022
2021
(In millions, except for share and per share data)
Numerator used in basic and diluted EPS:
Income from continuing operations . . . . . . . . . . . . . . . . $
Less: Net loss (income) attributable to noncontrolling
interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from discontinued operations, net of tax . . . . . .
768.4
$
1,042.1
$
607.1
0.2
(154.0)
(0.4)
(87.8)
(0.1)
59.2
Net income attributable to Verisk . . . . . . . . . . . . . . $
614.6
$
953.9
$
666.2
Denominator:
Weighted average number of common shares used in
basic EPS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effect of dilutive shares:
Potential common shares issuable from stock options
and stock-based awards . . . . . . . . . . . . . . . . . . . . . .
146,623,989
157,905,718
161,841,441
712,170
1,023,224
1,497,468
Weighted average number of common shares and
dilutive potential common shares used in diluted
EPS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147,336,159
158,928,942
163,338,909
The potential shares of common stock that were excluded from diluted EPS were 540,221, 1,350,159, and
620,241 at December 31, 2023, 2022, and 2021, respectively, because the effect of including those potential
shares was anti-dilutive.
Accumulated Other Comprehensive Losses
The following is a summary of accumulated other comprehensive income (losses) as of December 31:
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension and postretirement adjustment, net of tax . . . . . . . . . . . . . . . . . . . . . . . . .
$130.7
(72.5)
$(636.9)
(94.3)
Accumulated other comprehensive income (losses) . . . . . . . . . . . . . . . . . . . . . .
$ 58.2
$(731.2)
2023
2022
103
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The before tax and after tax amounts of other comprehensive (loss) income for the years ended
December 31, 2023, 2022, and 2021 are summarized below:
December 31, 2023
Foreign currency translation adjustment attributable to Verisk . . . . . . . . . . . . . . . .
Foreign currency translation adjustment attributable to noncontrolling interests . .
Cumulative translation adjustment recognized upon deconsolidation of the Energy
business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension and postretirement adjustment before reclassifications . . . . . . . . . . . . . . .
Amortization of net actuarial loss and prior service benefit reclassified from
accumulated other comprehensive income (losses) (1)
. . . . . . . . . . . . . . . . . . .
Pension and postretirement adjustment
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Before
Tax
Tax
Benefit
(Expense)
After
Tax
$ 67.0
0.6
$ — $ 67.0
0.6
—
700.6
768.2
35.1
(5.8)
29.3
—
—
(8.9)
1.4
(7.5)
700.6
768.2
26.2
(4.4)
21.8
Total other comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 797.5
$ (7.5)
$ 790.0
December 31, 2022
Foreign currency translation adjustment attributable to Verisk . . . . . . . . . . . . . . . .
Foreign currency translation adjustment attributable to noncontrolling interests . .
$(298.9)
(1.4)
$ — $(298.9)
(1.4)
—
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(300.3)
—
(300.3)
Pension and postretirement adjustment before reclassifications . . . . . . . . . . . . . . .
Amortization of net actuarial loss and prior service benefit reclassified from
(45.7)
13.5
(32.2)
accumulated other comprehensive income (losses) (1)
. . . . . . . . . . . . . . . . . . .
(4.4)
(1.1)
Pension and postretirement adjustment
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(50.1)
12.4
(5.5)
(37.7)
Total other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$(350.4)
$12.4
$(338.0)
December 31, 2021
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Foreign currency translation adjustment attributable to noncontrolling interests . .
$ (45.8)
(0.5)
$ — $ (45.8)
(0.5)
—
Foreign currency translation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(46.3)
Pension and postretirement adjustment before reclassifications . . . . . . . . . . . . . . .
Amortization of net actuarial loss and prior service benefit reclassified from
accumulated other comprehensive income (losses) (1)
. . . . . . . . . . . . . . . . . . .
Pension and postretirement adjustment
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
39.8
(4.1)
35.7
—
(9.8)
1.0
(8.8)
(46.3)
30.0
(3.1)
26.9
Total other comprehensive loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (10.6)
$ (8.8)
$ (19.4)
(1)
These accumulated other comprehensive loss components, before tax, are included under “Cost of revenues”
and “Selling, general and administrative” in our accompanying consolidated statements of operations. These
components are also included in the computation of net periodic (benefit) cost (See Note 18. Pension and
Postretirement Benefits for additional details).
104
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
17. Compensation Plans:
KSOP
We have established the KSOP for the benefit of eligible employees in the U.S. and Puerto Rico. The
KSOP includes both an employee savings component and an employee stock ownership component. The purpose
of the combined plan is to enable our employees to participate in a tax-deferred savings arrangement under
Internal Revenue Service Code Sections 401(a) and 401(k) (the “Code”), and to provide our employees equity
participation through the employee stock ownership plan (“ESOP”) accounts.
Under the KSOP, eligible employees may make pre-tax and after-tax cash contributions as a percentage
of their compensation, subject to certain limitations under the applicable provisions of the Code. The maximum
pre-tax contribution that can be made to the 401(k) account as determined under the provisions of Code
Section 401(g) is $22.5 thousand for 2023, $20.5 thousand for 2022 and $19.5 thousand for 2021. Certain
eligible participants (age 50 and older) may contribute an additional $7.5 thousand on a pre-tax basis for 2023,
and $6.5 thousand for 2022 and 2021. After-tax contributions are limited to 10.0% of a participant’s
compensation. Effective January 1, 2019, we increased the matching contributions to 100.0% of the first 6.0% of
the participant’s contribution. The 401(k) matching contributions under the KSOP for the years ended
December 31, 2023, 2022, and 2021, were $32.4 million, $40.0 million, and $33.7 million, respectively; which,
at our option, were funded in cash.
In 2005, we established the ISO Profit Sharing Plan (the “Profit Sharing Plan”), a defined contribution
plan, to replace the qualified pension plan for all eligible employees hired on or after March 1, 2005. The Profit
Sharing Plan is a component of the KSOP. Eligible employees participated in the Profit Sharing Plan if they
completed 1,000 hours of service each plan year and were employed on December 31 of that year. We can make
a discretionary contribution to the Profit Sharing Plan based on our annual performance. Participants vest once
they have completed four years and 1,000 hours of service. For the years ended December 31, 2023, 2022, and
2021, there were no profit sharing contributions.
Equity Compensation Plans
All of our outstanding stock options, restricted stock awards, deferred stock units, and PSUs are covered
under our 2021 Incentive Plan, or our 2013 Incentive Plan. Awards under our 2021 Incentive Plan may include
one or more of the following types: (i) stock options (both nonqualified and incentive stock options), (ii) stock
appreciation rights, (iii) restricted stock, (iv) restricted stock units, (v) performance awards, (vi) other share-
based awards and (vii) cash. Employees, non-employee directors, and consultants are eligible for awards under
our 2021 Incentive Plan. We transferred common stock under these plans from our treasury shares. As of
December 31, 2023, there were 13,441,921 shares of common stock reserved and available for future issuance
under our 2021 Incentive Plan. Cash received from stock option exercises for December 31, 2023 and
December 31, 2022 was $141.9 million and $132.5 million, respectively. We issued common stock under these
plans from our treasury shares. We have granted equity awards to key employees and directors. The ultimate
realization of the PSUs may range from 0% to 200% of the recipient’s target levels established on the grant date.
105
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
A summary of the status of the stock options, restricted stock, and PSUs awarded under our 2021
Incentive Plan as of December 31, 2023, 2022, and 2021 and changes during the years is presented below.
Stock Option
Restricted Stock
PSU
Weighted
Average
Exercise
Price
Number of
Options
Aggregate
Intrinsic
Value
(in millions)
Weighted
Average Grant
Date Fair Value
Per Share
Weighted
Average Grant
Date Fair Value
Per Share
Number of
Shares
Number of
Shares
Outstanding at January 1,
2021 . . . . . . . . . . . . . . . . . . . 5,611,777 $ 98.28
$613.4
390,054
$131.63
145,609
$170.75
750,822 $189.29
Granted . . . . . . . . . . . . . . .
Dividend reinvestment . . .
— $ —
Exercised or lapsed . . . . . . (1,146,422) $ 73.30
$147.6
Canceled, expired or
162,378
$189.23
— $ —
$120.94
(173,726)
59,144
980
(42,610)
$210.07
N/A
$140.70
forfeited . . . . . . . . . . . .
(149,079) $155.40
(27,202)
$157.79
—
$ —
Outstanding at December 31,
2021 . . . . . . . . . . . . . . . . . . . 5,067,098 $115.73
$572.6
351,504
$161.33
163,123
$192.99
653,802 $196.64
Granted . . . . . . . . . . . . . . .
Dividend reinvestment . . .
— $ —
Exercised or lapsed . . . . . . (1,435,673) $ 92.38
$129.1
Canceled, expired or
201,617
$193.33
— $ —
$157.22
(205,407)
111,333
1,371
(54,927)
$168.63
N/A
$174.42
forfeited . . . . . . . . . . . .
(261,411) $181.48
(40,139)
$182.35
(21,406)
$202.55
Outstanding at December 31,
2022 . . . . . . . . . . . . . . . . . . . 4,023,816 $132.90
$193.3
307,575
$182.07
199,494
$195.34
211,945 $185.29
Granted . . . . . . . . . . . . . . .
Dividend reinvestment . . .
— $ —
Exercised or lapsed . . . . . . (1,295,815) $108.85
$118.1
Canceled, expired or
194,236
$185.22
— $ —
$179.39
(178,602)
48,486
1,142
(45,997)
$212.86
N/A
$192.93
forfeited . . . . . . . . . . . .
(227,436) $187.56
(32,170)
$183.25
(21,889)
$207.27
Outstanding at December 31,
2023 . . . . . . . . . . . . . . . . . . . 2,712,510 $143.91
$257.6
291,039
$186.28
181,236
$199.62
Exercisable at December 31,
2023 . . . . . . . . . . . . . . . . . . . 1,947,253 $127.43
$217.0
Exercisable at December 31,
2022 . . . . . . . . . . . . . . . . . . . 2,702,075 $110.02
$182.6
Nonvested at December 31,
2023 . . . . . . . . . . . . . . . . . . .
765,257
Expected to vest at
December 31, 2023 . . . . . . . .
643,367
(1)
Includes estimated performance achievement
106
291,039
252,146
181,236
223,629(1)
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The fair value of our stock options granted was estimated on the date of grant using a Black-Scholes
option valuation model that uses the weighted-average assumptions noted in the following table during the years
ended December 31:
Expected volatility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Risk-free interest rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected term in years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividend yield . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted average grant date fair value per stock option . . . . . . . . . . . . .
27.28% 25.33% 23.66%
0.39%
1.55%
3.77%
4.2
4.0
4.3
0.63%
0.60%
0.66%
$48.14
$42.25
$35.15
2023
2022
2021
A summary of the status of our nonvested options and changes are presented below:
Weighted
Average
Grant-Date
Fair Value
Per Share
Number of
Options
Nonvested balance at January 1, 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,117,613
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cancelled or expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
750,822
(825,850)
(149,079)
Nonvested balance at December 31, 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,893,506
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cancelled or expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
653,802
(964,156)
(261,411)
Nonvested balance at December 31, 2022 . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,321,741
Granted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Vested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cancelled or expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
211,945
(540,993)
(227,436)
Nonvested balance at December 31, 2023 . . . . . . . . . . . . . . . . . . . . . . . . . . .
765,257
$23.39
$35.15
$21.62
$27.54
$28.49
$42.25
$22.97
$35.23
$34.65
$52.69
$33.08
$38.03
$39.74
Intrinsic value for stock options is calculated based on the exercise price of the underlying awards and the
quoted price of our common stock as of the reporting date. Excess tax benefits of $20.6 million, $26.5 million,
and $35.9 million from exercised stock options were recorded as income tax benefit in our accompanying
consolidated statements of operations for the years ended December 31, 2023, 2022, and 2021, respectively.
Stock-based compensation expense for the years ended December 31, 2023, 2022, and 2021 was $54.0 million,
$56.5 million, and $55.7 million, respectively. As of December 31, 2023, the weighted average remaining
contractual terms were 5.6 years and 4.8 years for outstanding and exercisable stock options, respectively. As of
December 31, 2022 the weighted average remaining contractual terms were 5.9 years and 4.9 years for
outstanding and exercisable stock options, respectively.
As of December 31, 2023, there was $76.2 million of total unrecognized compensation cost, exclusive of
the impact of vesting upon retirement eligibility, related to nonvested share-based compensation arrangements
granted under our 2021 and 2013 Incentive Plans. That cost is expected to be recognized over a weighted-
average period of 2.18 years.
107
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Our U.K. Sharesave Plan offers qualifying employees in the United Kingdom the opportunity to own
shares of our common stock. Employees who elect to participate are granted stock options, of which the exercise
price is equal to the average of the closing price on the five trading days immediately preceding the plan
invitation date discounted by 5%, and enter into a savings contract, the proceeds of which are then used to
exercise the options upon the three-year maturity of the savings contract. During the years ended December 31,
2023, 2022, and 2021, we granted 5,144, 9,370 and 11,254 stock options under the U.K. Sharesave Plan at a
discounted exercise price of $227.65, $178.26, and $166.16, respectively. As of December 31, 2023, there were
441,528 shares of common stock reserved and available for future issuance under our U.K. Sharesave Plan.
We also offer eligible employees the opportunity to participate in an ESPP. Under our ESPP, participating
employees may authorize payroll deductions of up to 20.0% of their regular base salary and up to 50.0% of their
short-term incentive compensation, both of which in total may not exceed $25.0 thousand in any calendar year, to
purchase shares of our common stock at a 5.0% discount of its fair market value at the time of purchase. In
accordance with ASC 718, our ESPP is noncompensatory as the purchase discount is 5.0% or less from the fair
market value, substantially all employees that meet limited employment qualifications may participate, and it
incorporates no option features. During the years ended December 31, 2023, 2022, and 2021, we issued 18,636,
30,398, and 33,974 shares of common stock at a weighted average discounted price of $209.68, $174.66, and
$181.77, respectively. As of December 31, 2023, there were 1,177,258 shares of common stock reserved and
available for future issuance under our ESPP.
18. Pension and Postretirement Benefits:
We have a frozen qualified defined benefit pension plan for certain of our employees through
membership in the Pension Plan for Insurance Organizations (the “Pension Plan”), a multiple-employer trust.
Prior to the freeze, we applied a cash balance formula to determine future benefits. Under the cash balance
formula, each participant has an account, which was credited annually based on salary rates determined by years
of service, as well as the interest earned on the previous year-end cash balance. We also have a non-qualified
frozen supplemental cash balance plan (“SERP”) for certain employees. Our SERP is funded from our general
assets. We contributed $1.7 million to our SERP in 2023 and $0.8 million in 2022, respectively, and expect to
contribute $1.0 million in 2024.
Our Pension Plan’s funding policy is to contribute annually at an amount between the minimum funding
requirements set forth in the Employee Retirement Income Security Act of 1974 and the maximum amount that
can be deducted for federal income tax purposes. No minimum contribution requirement was and is expected
for 2023 and 2022, respectively.
We also provide certain healthcare and life insurance benefits for both active and retired employees. The
Postretirement Health and Life Insurance Plan (the “Postretirement Plan”), which has been frozen, is
contributory, requiring participants to pay a stated percentage of the premium for coverage. We do not expect to
contribute to our Postretirement Plan in 2024.
108
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table sets forth the changes in the benefit obligations and the plan assets, the funded status
of the Pension Plan, SERP, and Postretirement Plan, and the amounts recognized in our consolidated balance
sheets at December 31:
Pension Plan and SERP
Postretirement Plan
2023
2022
2023
2022
Change in benefit obligation:
Benefit obligation at January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Plan participants’ contributions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 330.9
17.1
(0.8)
—
(29.4)
$ 431.7
14.7
(86.6)
—
(28.9)
Benefit obligation at December 31 . . . . . . . . . . . . . . . . . . . . . .
$ 317.8
$ 330.9
Accumulated benefit obligation at December 31
$ 317.8
$ 330.9
Change in plan assets:
Fair value of plan assets at January 1 . . . . . . . . . . . . . . . . . . . . . .
Actuarial gain (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employer contributions, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Plan participants’ contributions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 406.3
47.3
1.7
—
(29.4)
$ 546.2
(111.8)
0.8
—
(28.9)
Fair value of plan assets at December 31 . . . . . . . . . . . . . . . . .
$ 425.9
$ 406.3
$ 4.2
0.2
1.1
1.3
(2.7)
$ 4.1
$ 7.6
0.4
1.5
1.3
(2.7)
$ 8.1
Funded status at December 31 . . . . . . . . . . . . . . . . . . . . . . . . . .
$(108.1)
$ (75.4)
$(4.0)
Amounts recognized in the consolidated balance sheets consist of:
Pension assets, noncurrent (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension, SERP and postretirement benefits, current (2) . . . . . . . . .
Pension, SERP and postretirement benefits, noncurrent (3) . . . . . .
$(117.4)
1.0
8.3
$ (85.6)
0.8
9.4
Total Pension, SERP and Postretirement benefits . . . . . . . . . . .
$(108.1)
$ (75.4)
$(4.0)
—
—
$(4.0)
$ 6.0
0.1
(0.4)
1.3
(2.8)
$ 4.2
$ 9.5
(1.1)
0.7
1.3
(2.8)
$ 7.6
$(3.4)
$(3.4)
—
—
$(3.4)
(1)
(2)
(3)
Included in “Other noncurrent assets” in our accompanying consolidated balance sheets
Included in “Accounts payable and accrued liabilities” in our accompanying consolidated balance sheets
Included in “Other noncurrent liabilities” in our accompanying consolidated balance sheets
The pre-tax components included within accumulated other comprehensive losses as of December 31 are
summarized below:
Prior service benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
2.4
118.3
Accumulated other comprehensive losses, pretax . . . . . . . . . . . . .
$120.7
$
2.6
147.8
$150.4
2023
2022
2023
$ —
3.6
$3.6
2022
$ —
3.2
$3.2
Pension Plan and SERP
Postretirement Plan
109
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The pre-tax components of net periodic benefit (credit) cost and the amounts recognized in other
comprehensive income are summarized below for the years ended December 31:
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of prior service cost (credit) reclassified from
accumulated other comprehensive income . . . . . . . . . . . . . . .
Amortization of net actuarial loss reclassified from
accumulated other comprehensive income . . . . . . . . . . . . . . .
Pension Plan and SERP
Postretirement Plan
2023
2022
2021
2023
2022
2021
$ 17.1
(24.1)
$ 14.7
(28.2)
$ 11.0
(32.8)
$ 0.2
(0.1)
$ 0.1
(0.2)
$ 0.1
(0.2)
0.2
5.2
0.2
4.0
0.2
3.8
—
0.4
0.5
— (0.1)
0.2
0.1
0.2
—
Net periodic (credit) benefit cost . . . . . . . . . . . . . . . . . . . . . . .
(1.6)
(9.3)
(17.8)
Less: Amortization of prior service (cost) credit reclassified
from accumulated other comprehensive income . . . . . . . . . . .
(0.2)
(0.2)
(0.2) —
— 0.1
Less: Amortization of actuarial loss reclassified from
accumulated other comprehensive losses . . . . . . . . . . . . . . . .
(0.1)
(0.2)
(0.2) —
—
—
Less: Net loss recognized reclassified from accumulated other
comprehensive losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total recognized in other comprehensive income . . . . . . . . .
Total recognized in net periodic benefit credit and other
(5.1)
(24.3)
(29.7)
(3.8)
53.5
49.3
(3.6)
(31.1)
(35.1)
(0.4)
0.8
0.4
(0.2)
1.0
0.8
(0.2)
(0.5)
(0.6)
comprehensive (income) loss . . . . . . . . . . . . . . . . . . . . . . .
$(31.3) $ 40.0
$(52.9) $ 0.9
$ 0.9 $(0.6)
The weighted-average assumptions used to determine benefit obligations as of December 31, 2023 and
2022 and net periodic benefit (credit) cost for the years 2023, 2022 and 2021 are provided below:
Weighted-average assumptions used to determine benefit obligations:
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash balance interest credit rate . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension Plan and SERP
Postretirement Plan
2023
2022
2023
2022
5.37% 5.49%
6.50% 6.25%
4.43% 2.57%
4.75% 5.25%
1.75% 1.75%
N/A
2023
2022
2021
2023
2022
2021
Weighted-average assumptions used to determine net periodic benefit
(credit) cost:
Discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash balance interest credit rate . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.48% 2.75% 2.49% 5.25% 2.25% 1.50%
6.25% 6.25% 6.50% 1.75% 1.75% 2.00%
4.43% 2.57% 2.57% N/A
110
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table presents the estimated future benefit payments for the respective plans. The future
benefit payments for the Postretirement Plan are net of the federal Medicare subsidy.
2024 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2025 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2027 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2028 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2029 and thereafter . . . . . . . . . . . . . . . . .
Pension Plan
and SERP
Gross Benefit
Amount
$ 29.4
$ 28.9
$ 28.4
$ 28.4
$ 27.0
$123.3
Postretirement
Plan
Gross Benefit
Amount
Medicare Subsidy
Payments
Net Benefit
Amount
$0.8
$0.7
$0.6
$0.5
$0.4
$1.4
$(0.1)
$ —
$ —
$ —
$ —
$ —
$0.7
$0.7
$0.6
$0.5
$0.4
$1.4
The healthcare cost trend rate for 2023 was 7.75% gradually decreasing to 4.5% in 2037. Assumed
healthcare cost trend rates have a significant effect on the amounts reported for the healthcare plan.
The subsidy benefit from the Medicare Prescription Drug, Improvement and Modernization Act of 2003
reduced our accumulated postretirement benefit assets by approximately $1.0 and $0.8 million as of
December 31, 2023 and 2022, respectively. The subsidy cost increased the net periodic benefit cost by
approximately $118.1 thousand, $80.7 thousand, and $75.8 thousand in fiscal 2023, 2022 and 2021, respectively.
The expected return on our Pension Plan assets as of December 31, 2023 and 2022 was 6.25%, which was
determined by taking into consideration our analysis of our actual historical investment returns to a broader long-
term forecast after adjusting for the target investment allocation and reflecting the current economic
environment. During the first quarter of 2023, we changed the investment guidelines on our Pension Plan assets
to target investment allocation of 40% to equity securities and 60% to debt securities from our previous target
allocation of 45% to equity securities and 55% to debt securities as of December 31, 2022. Our Pension Plan
assets consist primarily of investments in various fixed income and equity funds. Investment guidelines are
established with each investment manager. These guidelines provide the parameters within which the investment
managers agree to operate, including criteria that determine eligible and ineligible securities, diversification
requirements and credit quality standards, where applicable. Investment managers are prohibited from entering
into any speculative hedging transactions. The investment objective is to achieve a maximum total return with
strong emphasis on preservation of capital in real terms.
The asset allocation at December 31, 2023 and 2022, and target allocation by asset category are as
follows:
Asset Category
Target
Percentage of
Plan Assets
Allocation
2023
2022
Equity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real Estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
40.0%
60.0
—
—
40.0% 41.4%
53.5
5.3
1.2
52.9
5.0
0.7
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100.0% 100.0% 100.0%
We have used the target investment allocation to derive the expected return as we believe this allocation
will be retained on an ongoing basis that will be commensurate with the projected cash flows of the plan. The
111
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
expected return for each investment category within the target investment allocation is developed using average
historical rates of return for each targeted investment category, considering the projected cash flow of
our Pension Plan. The difference between this expected return and the actual return on plan assets is generally
deferred and recognized over subsequent periods through future net periodic benefit costs. We believe that the
use of the average historical rates of returns is consistent with the timing and amounts of expected contributions
to the plans and benefit payments to plan participants. These considerations provide the basis for reasonable
assumptions with respect to the expected long-term rate of return on plan assets.
We also maintain a voluntary employees beneficiary association plan (the “VEBA Plan”) under
Section 501(c)(9) of the Internal Revenue Code to fund the Postretirement Plan. The asset allocation for
our VEBA Plan at December 31, 2023 and 2022 was 100% in debt securities.
There were no transfers among Levels 1, 2, or 3 for the years ended December 31, 2023 and 2022. Refer
to Note 7. Fair Value Measurements for further discussion with respect to fair value hierarchy. The following
table summarizes the fair value measurements by level of our Pension Plan and Postretirement Plan assets:
Quoted Prices
in Active Markets
for Identical
Assets (Level 1)
Significant Other
Observable
Inputs (Level 2)
Total
December 31, 2023
Equity
Managed equity accounts (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity — pooled separate account (2) . . . . . . . . . . . . . . . . . . . . . . . .
$131.6
38.6
$131.6
—
Debt
Fixed income manager — separately managed account (5)
Fixed income manager — pooled separate account (2)
Fixed income manager — government securities (3)
. . . . . . .
. . . . . . . . . .
. . . . . . . . . . . .
Others
Cash — pooled separate account (2) . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Global real estate account (4)
138.9
89.2
8.1
5.2
22.4
—
—
8.1
—
—
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$434.0
$139.7
December 31, 2022
Equity
Managed equity accounts (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity — pooled separate account (2) . . . . . . . . . . . . . . . . . . . . . . . .
$128.8
39.7
$128.8
—
Debt
Fixed income manager — separately managed account (5)
Fixed income manager — pooled separate account (2)
Fixed income manager — government securities (3)
. . . . . . .
. . . . . . . . . .
. . . . . . . . . . . .
Others
Cash — pooled separate account (2) . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Global real estate account (4)
133.6
81.5
7.7
2.7
20.2
—
—
7.7
—
—
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$414.2
$136.5
$ —
38.6
138.9
89.2
—
5.2
22.4
$294.3
$ —
39.7
133.6
81.5
—
2.7
20.2
$277.7
(1) Valued at the closing price of shares for domestic stocks within the managed equity accounts, and valued at
the net asset value (“NAV”) of shares for mutual funds at either the closing price reported in the active
112
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(2)
(3)
(4)
(5)
market or based on yields currently available on comparable securities of issuers with similar credit ratings
for corporate bonds held by the Pension Plan in these managed accounts.
The pooled separate accounts invest in domestic and foreign stocks, bonds and mutual funds. The fair values
of these stocks, bonds and mutual funds are publicly quoted and are used in determining the NAV of the
pooled separate account, which is not publicly quoted.
The fund invested in the U.S. government, its agencies or instrumentalities or securities that are rated AAA
by S&P, AAA by Fitch, or Aaa by Moody’s, including but not limited to mortgage securities such as agency
and non-agency collateralized mortgage obligations, and other obligations that are secured by mortgages or
mortgage backed securities, and valued at the closing price reported in the active market.
The funds invested in common stocks and other equity securities issued by domestic and foreign real estate
companies, including real estate investment trusts (“REIT”) and similar REIT-like entities. The fair values
of these stocks, bonds and mutual funds are publicly quoted and are used in determining the NAV of the
funds, which is not publicly quoted.
The separately managed accounts invest in U.S. Treasury Bonds and U.S. Treasury Separate Trading of
Registered Interest and Principal of Securities (“UST STRIPS”). The fair values of these bonds and UST
STRIPS are publicly quoted and are used in determining the NAV of the separately managed account, which
is not publicly quoted.
19. Segment Reporting
ASC 280-10, Disclosures About Segments of an Enterprise and Related Information (“ASC 280-10”),
establishes standards for reporting information about operating segments. ASC 280-10 requires that a public
business enterprise reports financial and descriptive information about its reportable operating segments.
Operating segments are components of an enterprise for which separate financial information is available that is
evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and
in assessing performance. Our President and CEO is identified as the CODM as defined by ASC 280-10.
Each of our reportable segments, Insurance, Energy and Specialized Markets, and Financial Services has
a portion of its revenue from more than one of the three revenue types described within the revenue recognition
policy within Note 2. Basis of Presentation and Summary of Significant Accounting Policies. Below is the
overview of the solutions offered within each reportable segment.
Insurance: We are the leading provider of statistical, actuarial, and underwriting data for the U.S. P&C
insurance industry. Our databases include cleansed and standardized records describing premiums and losses in
insurance transactions, casualty and property risk attributes for commercial buildings and their occupants, and
fire suppression capabilities of municipalities. We use this data to create policy language and proprietary risk
classifications that are industry standards and to generate prospective loss cost estimates used to price insurance
policies, which are accessed via a hosted platform. We also develop solutions that our customers use to analyze
key processes in managing risk. Our combination of algorithms and analytic methods incorporates
our proprietary data to generate solutions. We also help businesses and governments better anticipate and manage
climate and weather-related risks. In most cases, our customers integrate the solutions into their models, formulas
or underwriting criteria in order to predict potential loss events, ranging from hurricanes to earthquakes. We
develop catastrophe and extreme event models and offer solutions covering natural and man-made risks,
including acts of terrorism. We further develop solutions that allow customers to quantify costs after loss events
occur. Our multitier, multispectral terrestrial imagery and data acquisition, processing, analytics, and distribution
system using the remote sensing and machine learning technologies help gather, store, process, and deliver
geographic and spatially referenced information that supports uses in many markets. Additionally, we
113
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
offer fraud-detection solutions including review of data on claim histories, analysis of claims to find emerging
patterns of fraud, and identification of suspicious claims in the insurance sector. Our underwriting, insurance
anti-fraud claims, catastrophe modeling, and loss quantification are included in this segment.
Energy and Specialized Markets: In the first quarter of 2022, the sale of 3E (which comprised of our
Specialized Market) was completed. On February 1, 2023, we completed the sale of our Energy segment. We
determined that the transaction met the criteria to be classified as discontinued operations. As a result, the
financial operations of Energy are excluded from the segment disclosure. See Note 11. Dispositions and
Discontinued Operations for further discussion. Prior to the sale, we were a leading provider of data analytics via
hosted platform for the global energy, chemicals, and metals and mining industries. Our research and consulting
solutions focused on exploration strategies and screening, asset development and acquisition, commodity
markets, and corporate analysis in the areas of business environment, business improvement, business strategies,
commercial advisory, and transaction support. We gathered and managed proprietary information, insight, and
analysis are on oil and gas fields, mines, refineries, and other assets across the interconnected global energy
sectors to advise customers in making asset investment and portfolio allocation decisions. Our analytical tools
measured and observed environmental properties and translated those measurements into actionable information
based on customer needs. In addition, we provided market and cost intelligence to energy companies to optimize
financial results. We further offered a suite of data and information services that enable improved compliance
with global Environmental Health and Safety requirements related to the safe manufacturing, distribution,
transportation, usage, and disposal of chemicals and products.
Financial Services: On April 8, 2022, the sale of this segment was completed. See Note 11. Dispositions
and Discontinued Operations for further discussion. Prior to the sale, we maintained a bank account consortia to
provide competitive benchmarking, decisioning algorithms, business intelligence, and customized analytic
services that help financial institutions, payment networks and processors, alternative lenders, regulators, and
merchants make better strategy, marketing, and risk decisions. Customers applied our solutions in the areas of
tailored data management and media effectiveness that include business intelligence platforms, profile views,
mobile data solutions, enterprise database services, and fraud risk scoring algorithms for marketing, fraud, and
risk mitigation.
As of February 1, 2023, we have determined that we have one operating segment and one reportable
segment, Insurance, on a prospective basis. The segment is based on financial information that is utilized by the
Company’s CODM, who is the Company’s CEO, to assess performance and allocate resources on a consolidated
basis. We have included the results of our disposed of segments below for comparability purposes. We
use EBITDA as the profitability measure for making decisions regarding ongoing operations. EBITDA is net
income before interest expense, provision for income taxes, depreciation and amortization of fixed and intangible
assets. EBITDA is the measure of operating results used to assess corporate performance and optimal utilization
of debt and acquisitions. Operating expenses consist of direct and indirect costs principally related to personnel,
facilities, software license fees, consulting, travel, and third-party information services. We do not allocate
interest expense and provision for income taxes, since these items are not considered in evaluating the segment’s
overall operating performance. In addition, our CODM does not evaluate the financial performance of each
segment based on assets. See Note 6. Revenues for information on disaggregated revenues by type of service and
by country.
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VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
The following table provides our revenue and EBITDA by reportable segment for the years ended
December 31, as well as a reconciliation of EBITDA to income before income taxes for all periods presented in
our accompanying consolidated statements of operations:
2023
2022
2021
Insurance Total
Insurance
Energy
and
Specialized
Markets
Financial
Services
Energy
and
Specialized
Markets
Financial
Services
Total
Total
Insurance
Revenues . . . . . . . . . . . . . . . . . . . . . . . . $2,681.4 $2,681.4 $2,437.0
$ 22.4
$ 37.6 $2,497.0 $2,206.9
$112.8
$ 142.8 $2,462.5
Expenses:
Cost of revenues (exclusive of items
shown separately below) . . . . . . . .
Selling, general and administrative . .
Other operating gain (loss)
. . . . . . . .
Investment income (loss) . . . . . . . . . .
EBITDA from discontinued
operations of the Energy
business . . . . . . . . . . . . . . . . . . .
(876.5)
(391.8)
—
11.0
(876.5)
(391.8)
—
11.0
(781.9)
(347.4)
(19.1)
(26.7)
— 450.0
(0.4)
(4.7)
(23.6)
(7.4)
(95.8)
(0.2)
(824.6)
(381.5)
354.2
(5.3)
(704.4)
(239.1)
—
1.8
(58.9)
(44.9)
(90.4)
(29.2)
— (134.0)
(0.3)
0.6
(853.7)
(313.2)
(134.0)
2.1
—
—
— (117.9)
— (117.9)
— 222.3
— 222.3
EBITDA . . . . . . . . . . . . . . . . . . . . $1,424.1 $1,424.1 $1,303.0
$ 308.3
$(89.4) $1,521.9 $1,265.2
$231.9
$(111.1) $1,386.0
EBITDA from discontinued
operations of the Energy
business . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization of
fixed assets . . . . . . . . . . . . . . . . . . .
Amortization of intangible assets . . .
Interest expense . . . . . . . . . . . . . . . . .
—
(206.8)
(74.6)
(115.5)
Income before income taxes . . . . . . .
$1,027.2
117.9
(164.2)
(74.4)
(138.8)
$1,262.4
(222.3)
(170.3)
(79.9)
(127.0)
$ 786.5
Long-lived assets by country are provided below as of December 31:
Long-lived assets:
U.S.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.K. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other countries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,455.7
597.9
502.4
$2,876.5
2,428.9
730.6
Total long-lived assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$3,556.0
$6,036.0
2023
2022
20. Related Parties:
We consider our stockholders that own more than 5% of the outstanding stock within the class to be
related parties as defined within ASC 850, Related Party Disclosures. We had no material transactions with
related parties owning more than 5% of the entire class of stock for the years ended December 31, 2023 and
2022.
115
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Jeffrey Dailey, one of our directors, was CEO and Chairman of the Board of Farmers Group, Inc.
(“Farmers”) until December 31, 2022 and June 30, 2023, respectively. Farmers is a customer of Verisk, and our
revenue from Farmers is approximately 2% of our consolidated revenue in 2023 and 2022.
Therese M. Vaughan, one of our directors, was also a director of American International Group (“AIG”)
until January 31, 2024. AIG is a customer of Verisk, and our revenue from AIG is approximately 1% of
our consolidated revenue in 2023 and 2022.
Lee M. Shavel, our President and CEO and one of our directors, is a director of FactSet Research
Systems, Inc. There are no material transactions with FactSet Research Systems, Inc.
21. Commitments and Contingencies:
Commercial Litigation
On February 12, 2024, Plaintiffs filed a lawsuit, DDS Striker Holdings LLC and Data Driven Holdings
LLC against Verisk Analytics, Inc. and Insurance Service Office, in the Superior Court of Delaware, Case No.
N24C-02-130 VLM CCLD. Plaintiffs allege claims for breach of contract, breach of the implied covenant of
good faith and fair dealing, fraudulent inducement, common law fraud, and civil conspiracy in connection with
their inability to meet the post-closing earn-out targets negotiated as part of our acquisition of Data Driven
Safety, LLC. Plaintiffs seek rescissory, out-of-pocket and punitive damages, as well as attorney’s fees, costs and
other expenses. The deadline for our response is April 3, 2024. At this time, it is not possible to
reasonably estimate the liability related to this matter, as the case is still in its early stages.
ERISA Litigation
On September 24, 2020, former employees Jillyn Peterson, Gabe Hare, Robert Heynen and Adam
Krajewski (“Plaintiffs”), filed suit in the United States District Court, District of New Jersey
(No. 2:20-cv-13223-CCC-MF) against Defendants Insurance Services Office Inc. (“ISO”), the Plan
Administration Committee of Insurance Services Office Inc. and its members (“Committee Defendants”), and the
Trust Investment Committee of Insurance Services Office Inc. and its members. The class action complaint
alleges violations of the Employee Retirement Income Security Act, as amended (“ERISA”). The class is defined
as all persons who were participants in or beneficiaries of the ISO 401(k) Savings and Employee Stock
Ownership Plan (“Plan”), at any time between September 24, 2014 through the date of judgment. The complaint
alleges that all defendants are fiduciaries with respect to the Plan. Plaintiffs challenge the amount of fees paid by
Plan participants to maintain the investment funds in the plan portfolio and the amount of recordkeeper fees paid
by participants. Plaintiffs allege that by permitting the payment of excessive fees, the Committee Defendants
breached their ERISA duties of prudence and loyalty. Plaintiffs further allege that ISO breached its ERISA duty
by failing to monitor the Committee Defendants who they allege committed known breaches of their fiduciary
duties. The complaint does not specify damages but alleges the fiduciary breaches cost Plan participants millions
of dollars. Defendants filed their motion to dismiss the complaint on January 12, 2021, which the court partially
denied on April 13, 2021. Fact discovery was completed. The court stayed the litigation pending the outcome of
the parties’ mediation, but the stay was lifted on May 5, 2023. The parties engaged in expert discovery, and this
matter was settled before a mediator on October 4, 2023. The settlement agreement was signed by both parties,
and on January 12, 2024, the court granted preliminary approval of class action settlement.
Financial Services Government Inquiry
We continue to cooperate with a civil inquiry by the Department of Justice (“DOJ”) related to
government contracts within our former Financial Services segment, which was sold to TransUnion in April
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VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
2022. We are engaged in ongoing discussions regarding potential resolution of the inquiry by the DOJ. There can
be no assurance that these discussions and continuing engagement will lead to resolution of the matter and we
cannot anticipate the timing, outcome or possible impact of the inquiry, including any potential material adverse
financial impacts or otherwise. We have recorded an accrued liability for approximately $39.0 million related to
this matter. Amounts payable pursuant to any potential resolution, however, could differ from such
amount. Under the stock purchase agreement we entered into with TransUnion pursuant to which TransUnion
acquired our former Financial Services segment, we agreed to indemnify TransUnion for certain losses with
respect to the inquiry.
In March 2022, we were informed that the SEC was conducting an inquiry related to certain contracts of
our former Financial Services segment. The SEC notified us on November 28, 2023 that it had concluded its
investigation and did not intend to recommend an enforcement action against the Company.
Data Privacy Litigation
On or about February 8, 2023, Plaintiffs filed a lawsuit, Atlas Data Privacy Corp., et al. v. Verisk
Analytics, Inc., et al., in the Superior Court of New Jersey, Middlesex County, Case No. MID-L-000903-24,
alleging violations of Daniel’s Law. Verisk has not yet been served. Atlas claims to be an “assignee” of claims of
approximately 19,640 individuals who are “covered persons” under Daniel’s Law, allegedly enacted to provide
judicial and law enforcement officers and their family members with the right to prevent disclosure of their
personal information and to enforce those rights against uncooperative data brokers. It is alleged that Defendants
have violated Daniel’s Law by failing to respond and comply with their written request to Defendants to cease
publicly disclosing or re-disclosing their protected information. Plaintiffs seek actual damages in the amount of
$1,000 per violation under the statute, punitive damages, injunctive relief ordering compliance with Daniel’s
Law, permanent injunctive relief, including the appointment of a qualified independent expert to ensure
compliance with Daniel’s Law, and reasonable attorney’s fees and costs. At this time, it is not possible to
reasonably estimate the liability related to this matter, as the case is still in its early stages.
On January 30, 2023, Plaintiffs Justin Ahringer and Michael Donner filed a putative class action lawsuit
in the United States District Court, Central District of California, titled Ahringer et al. v. LoanDepot, Inc. and
Verisk Analytics, Inc. d/b/a Jornaya, Case No.: 8:23-cv-00186. Plaintiffs assert violations of California’s
Invasion of Privacy Act, Unfair Competition Law, and a violation of class members’ privacy rights under the
California Constitution. Plaintiffs allege that the Defendants recorded visitors’ electronic communications
without their consent. Plaintiffs seek to certify a nationwide class of individuals who visited LoanDepot.com and
provided personal information on the website’s forms to receive a quote or apply for a loan. They allege that the
aggregate claims of all members of the proposed class exceeds $5.0 million. Plaintiffs seek compensatory,
statutory or punitive damages or restitution, as well as reasonable attorney’s fees and other costs. We filed a
motion to dismiss Plaintiffs’ claims on April 13, 2023. The parties are currently engaging in jurisdictional
discovery in response to the court’s demand to Plaintiff to demonstrate why this case should not be dismissed for
lack of subject matter jurisdiction. The court found jurisdiction is proper and partially denied our motion on
February 7, 2024. The deadline to answer Plaintiffs’ Complaint is February 22, 2024. At this time, it
is not possible to reasonably estimate the liability related to this matter, as the case is still in its early stages.
On June 27, 2022, Plaintiff Loretta Williams brought a putative class action against Lead Intelligence,
Inc. d/b/a Jornaya (“we,” “our,” or “us”) in the United States District Court for the Northern District of
California, titled Williams v. DDR Media, LLC and Lead Intelligence, Inc. d/b/a Jornaya, Civil
Action No. 3:22-cv-03789. The Complaint alleges that the Defendants violated the California Invasion of Privacy
Act, Cal. Penal Code 631 (“CIPA”) and invaded Plaintiff’s and class members’ privacy rights when Defendants
purportedly recorded visitors’ visits to the scrappyrent2own.com website without prior express consent. It is
117
VERISK ANALYTICS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
further alleged that this conduct constitutes a violation of the California Unfair Competition Law, Cal. Bus. Prof.
Code Section 17200 et seq. and the California Constitution. The Complaint seeks class certification, injunctive
relief, statutory damages in the amount of $5,000 for each violation, attorneys fees and other litigation costs. Our
motion to compel arbitration was fully briefed as of January 27, 2023. It was denied on February 28, 2023. We
filed a motion to dismiss Plaintiff’s claims on April 13, 2023. On August 18, 2023 the court granted our motion,
dismissing Plaintiff’s claims without prejudice, but giving Plaintiff an opportunity to amend her claims
by September 20, 2023. Plaintiff filed a Second Amended Complaint (“SAC”) on September 20, 2023. Our
motion to dismiss the SAC was fully briefed on December 18, 2023. It was denied on January 30, 2024. The
court held an initial case management conference for February 9, 2024. At this time, it is not possible to
reasonably estimate the liability related to this matter, as the case is still in its early stages.
On December 15, 2021, Plaintiff Jillian Cantinieri brought a putative class action against Verisk
Analytics, Insurance Services Office and ISO Claims Services, Inc. (“we,” “our,” or “us”) in the United States
District Court for the Eastern District of New York, titled Cantinieri v. Verisk Analytics Inc., et al., Civil
Action No. 2:21-cv-6911. The Complaint alleges that we failed to safeguard the personally identifiable
information (PII) of Plaintiff and the members of the proposed classes from a purported breach of our databases
by unauthorized entities. Plaintiff and class members allege actual and imminent injuries, including theft of their
PII, fraudulent activity on their financial accounts, lowered credit scores, and costs associated with detection and
prevention of identity theft and fraud. They seek to recover compensatory, statutory and punitive damages,
disgorgement of earnings and profits, and attorney’s fees and costs. We filed our motion to dismiss Plaintiff’s
claims on April 22, 2022. On March 30, 2023 the court denied our motion to dismiss without prejudice, allowing
us an opportunity to re-file the motion once limited jurisdictional discovery has been completed. Our renewed
motion to dismiss was fully briefed on February 16, 2024. At this time, it is not possible to reasonably estimate
the liability related to this matter, as the case is still in its early stages.
22. Subsequent Events:
On January 9, 2024, we completed the acquisition of 100 percent of Rocket Enterprise Solutions GmbH
(“Rocket”) for a net cash purchase price of $10.6 million, of which $2.2 million represents a deferred payment
and $0.3 million represents a holdback payment. Rocket’s strong property claims and underwriting technology
has been widely adopted by many of the largest insurers and service providers across Germany and Austria.
Rocket has become a part of our claims category. The acquisition, which follows a strategic investment by Verisk
in Rocket in 2022, will further Verisk’s expansion in Europe and the Company’s goal of helping insurers and
claims service providers leverage more holistic data and technology tools to enhance the claims experience.
On February 14, 2024, our Board of Directors approved a cash dividend of $0.39 per share of common
stock issued and outstanding, payable on March 29, 2024, to holders of record as of March 15, 2024. Our Board
of Directors also approved an additional share repurchase authorization of $1,000.0 million.
**************
118
Supplementary Financial Information (Unaudited)
Schedule II
Valuation and Qualifying Accounts and Reserves
For the Years Ended December 31, 2023, 2022, and 2021
(In millions)
Description
Year ended December 31, 2023
Balance at Charged to
Costs and
Beginning
Expenses (1) Write-offs (2)
of Year
Deductions— Balance at
End of Year
Allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . .
$14.3
Valuation allowance for income taxes . . . . . . . . . . . . . . . . .
$45.3
Year ended December 31, 2022
Allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . .
$15.4
Valuation allowance for income taxes . . . . . . . . . . . . . . . . .
$38.3
Year ended December 31, 2021
Allowance for doubtful accounts . . . . . . . . . . . . . . . . . . . . .
$14.1
Valuation allowance for income taxes . . . . . . . . . . . . . . . . .
$30.6
$ 8.7
$ 1.2
$ 6.4
$41.2
$13.8
$ 8.1
$ (7.9)
$(40.9)
$ (7.5)
$(34.2)
$(12.5)
$ (0.4)
$15.1
$ 5.6
$14.3
$45.3
$15.4
$38.3
(1)
(2)
Primarily additional reserves for bad debts
Primarily accounts receivable balances written off, net of recoveries, the expiration of loss carryforwards,
and businesses held for sale
119
Exhibit
Number
3.1
3.2
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
10.1
10.2
EXHIBIT INDEX
Description
Restated Certificate of Incorporation of Verisk Analytics, Inc. effective May 25, 2022, incorporated
herein by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K dated May 25,
2022.
Amended and Restated By-Laws of Verisk Analytics, Inc. effective May 25, 2022, incorporated
herein by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K dated May 25,
2022.
Form of Common Stock Certificate, incorporated herein by reference to Exhibit 4.1 to Amendment
No. 6 to the Company’s Registration Statement on Form S-1 dated September 21, 2009.
Senior Notes Indenture, dated as of April 6, 2011, among Verisk Analytics, Inc., the guarantors
named therein and Wells Fargo Bank, National Association, as Trustee, incorporated herein by
reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated April 6, 2011.
First Supplemental Indenture, dated as of April 6, 2011, among Verisk Analytics, Inc., the guarantors
named therein and Wells Fargo Bank, National Association, as Trustee, incorporated herein by
reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K dated April 6, 2011.
Third Supplemental Indenture, dated as of September 12, 2012, among Verisk Analytics, Inc., the
guarantors named therein and Wells Fargo Bank, National Association, as Trustee, incorporated
herein by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K dated
September 12, 2012.
Fifth Supplemental Indenture, dated as of May 15, 2015, between Verisk Analytics, Inc. and Wells
Fargo Bank, National Association, as Trustee, incorporated herein by reference to Exhibit 4.2 to the
Company’s Current Report on Form 8-K dated May 15, 2015.
Senior Notes Indenture, dated March 6, 2019, among Verisk Analytics, Inc. and Wells Fargo Bank,
National Association, as Trustee, incorporated herein by reference to Exhibit 4.1 to the Company’s
Current Report on Form 8-K dated March 6, 2019.
First Supplemental Indenture, dated March 6, 2019, between Verisk Analytics, Inc. and Wells Fargo
Bank, National Association, as Trustee, incorporated herein by reference to Exhibit 4.2 to the
Company’s Current Report on Form 8-K dated March 6, 2019.
Second Supplemental Indenture, dated May 13, 2020, between Verisk Analytics, Inc. and Wells
Fargo Bank, National Association, as Trustee, incorporated herein by reference to Exhibit 4.1 to the
Company’s Current Report on Form 8-K dated May 13, 2020.
Description of Verisk Analytics, Inc.’s securities registered pursuant to Section 12 of the Securities
Exchange Act*
Third Supplemental Indenture, dated March 7, 2023, between Verisk Analytics, Inc. and
Computershare Trust Company, N.A. as successor to Wells Fargo Bank, N.A., as Trustee,
incorporated herein by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated
March 7, 2023.
401(k) Savings Plan and Employee Stock Ownership Plan, incorporated herein by reference to
Exhibit 10.1 to the Company’s Registration Statement on Form S-1 dated August 12, 2008.
Verisk Analytics, Inc. 2009 Equity Incentive Plan, incorporated herein by reference to Exhibit 10.2
to Amendment No. 6 to the Company’s Registration Statement on Form S-1 dated September 21,
2009.
120
Exhibit
Number
10.3
10.4
10.5
10.6
10.7
10.8
10.9
10.10
10.11
10.12
10.13
10.14
10.15
10.16
10.17
Description
Form of Letter Agreement, incorporated herein by reference to Exhibit 10.3 to Amendment No. 1 to
the Company’s Registration Statement on Form S-1 dated October 7, 2008.
Form of Master License Agreement and Participation Supplement, incorporated herein by reference
to Exhibit 10.4 to Amendment No. 1 to the Company’s Registration Statement on Form S-1 dated
October 7, 2008.
Schedule of Master License Agreements Substantially Identical in All Material Respects to the Form
of Master License Agreement and Participation Supplement, incorporated herein by reference to
Exhibit 10.5 to Amendment No. 2 to the Company’s Registration Statement on Form S-1 dated
November 20, 2008.
Form of Change of Control Severance Agreement, incorporated herein by reference to Exhibit 10.8
to Amendment No. 6 to the Company’s Registration Statement on Form S-1 dated September 21,
2009.
Insurance Services Office, Inc. 1996 Incentive Plan and Form of Stock Option Agreement
thereunder, incorporated herein by reference to Exhibit 10.9 to Amendment No. 7 to the Company’s
Registration Statement on Form S-1 dated September 29, 2009.
Form of Stock Option Award Agreement under the Verisk Analytics, Inc. 2009 Equity Incentive
Plan, incorporated herein by reference to Exhibit 10.2 to the Company’s Quarterly Report on
Form 10-Q dated November 16, 2009.
Insurance Services Office, Inc. Supplemental Cash Balance Plan dated January 1, 2009 as amended
by the Amendment to the Insurance Services Office, Inc. Supplemental Cash Balance Plan dated
February 10, 2012 incorporated by reference to Exhibit 10.12 to the Company’s Annual Report on
Form 10-K dated February 25, 2014.
Insurance Services Office, Inc. Supplemental Executive Retirement Savings Plan dated January 1,
2009 incorporated by reference to Exhibit 10.13 to the Company’s Annual Report on Form 10-K
dated February 25, 2014.
Verisk Analytics, Inc. 2013 Equity Incentive Plan, incorporated herein by reference to Appendix A to
the Company’s Proxy Statement on Schedule 14A dated April 1, 2013.
Form of Stock Option Award Agreement under Verisk Analytics, Inc. 2013 Equity Incentive Plan,
incorporated herein by reference to Exhibit 99.2 to Company’s Registration Statement on Form S-8
dated May 15, 2013.
Form of Restricted Stock Award Agreement under Verisk Analytics, Inc. 2013 Equity Incentive
Plan, incorporated herein by reference to Exhibit 99.3 to Company’s Registration Statement on Form
S-8 dated May 15, 2013.
Verisk Analytics, Inc. 2021 Equity Incentive Plan incorporated herein by reference to Appendix B to
the Company’s Proxy Statement on Schedule 14A dated April 2, 2021.
Purchase Agreement, dated as of January 21, 2022, by and among Verisk Analytics, Inc., Tamarack
Buyer, L.L.C. and, solely for the limited purpose set forth therein, 3E Company Environmental,
Ecological and Engineering, incorporated herein by reference to Exhibit 2.1 to the Company’s
Current Report on Form 8-K dated January 24, 2022.
Verisk Analytics, Inc. Senior Executive Severance Benefits Plan, incorporated herein by reference to
Exhibit 10.1 to the Company’s Current Report on Form 8-K dated April 5, 2022.
Amendment No. 3 to the Verisk Analytics, Inc. 2012 Employee Stock Purchase Plan, as amended,
incorporated herein by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q
dated August 2, 2022
121
Exhibit
Number
10.18
10.19
10.20
10.21
21.1
23.1
31.1
31.2
32.1
Description
Amended and Restated Loan Agreement dated September 9, 2022 among Verisk Analytics, Inc., as
borrower, and Bank of America, N.A. as the initial lender and administrative agent, incorporated
herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated
September 15, 2022.
Equity Purchase Agreement dated October 28, 2022 by and between Verisk Analytics, Inc. and
Planet Jersey Buyer Ltd, incorporated herein by reference to Exhibit 10.1 to the Company’s
Current Report on Form 8-K dated October 31, 2022.
Form of Confirmation — Fixed Dollar Accelerated Share Repurchase Transaction, incorporated
herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, dated March 7,
2023.
Fifth Amendment to Second Amended and Restated Credit Agreement dated as of April 5, 2023
among Verisk Analytics, Inc., as borrower, the lenders party thereto, and Bank of America, N.A.,
as administrative agent.
Subsidiaries of the Registrant.*
Consent of Deloitte & Touche LLP.*
Certification of the Chief Executive Officer of Verisk Analytics, Inc. pursuant to Rule 13a-14
under the Securities Exchange Act of 1934.*
Certification of the Chief Financial Officer of Verisk Analytics, Inc. pursuant to Rule 13a-14 under
the Securities Exchange Act of 1934.*
Certification of the Chief Executive Officer and Chief Financial Officer of Verisk Analytics, Inc.
pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.*
97.1
Verisk Analytics, Inc. Financial Statement Compensation Recoupment Policy*
101.INS
Inline XBRL Instance Document.*
101.SCH
Inline XBRL Taxonomy Extension Schema.*
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase.*
101.DEF
Inline XBRL Taxonomy Definition Linkbase.*
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase.*
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase.*
104
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).*
* Filed herewith.
122
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on
February 21, 2024.
VERISK ANALYTICS, INC.
(Registrant)
/S/
Lee M. Shavel
Lee M. Shavel
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below
by the following persons on behalf of the registrant and in the capacities indicated on February 21, 2024.
Signature
Capacity
/S/ LEE M. SHAVEL
Lee M. Shavel
/S/ ELIZABETH MANN
Elizabeth Mann
/S/ DAVID J. GROVER
David J. Grover
/S/ BRUCE HANSEN
Bruce Hansen
/S/ VINCENT BROOKS
Vincent K. Brooks
/S/ JEFFREY DAILEY
Jeffrey Dailey
/S/ KATHLEEN HOGENSON
Kathleen A. Hogenson
/S/ WENDY LANE
Wendy Lane
/S/ SAMUEL G. LISS
Samuel G. Liss
/S/ OLUMIDE SOROYE
Olumide Soroye
/S/ KIMBERLY S. STEVENSON
Kimberly S. Stevenson
/S/ THERESE M. VAUGHAN
Therese M. Vaughan
Chief Executive Officer
(principal executive officer and director)
Chief Financial Officer
(principal financial officer)
Controller and Chief Accounting Officer
(principal accounting officer)
Independent Chair
Director
Director
Director
Director
Director
Director
Director
Director
123
LIST OF SUBSIDIARIES OF THE REGISTRANT
NAME OF SUBSIDIARY
Exhibit 21.1
JURISDICTION
AIR Worldwide Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Insurance Services Office, Inc.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ISO Services, Inc.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Xactware Solutions, Inc.
Delaware
Delaware
Delaware
Delaware
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statement Nos. 333-270827, 333-237408,
333-216966, 333-194874 and 333-173135 on Form S-3 and Registration Statement Nos. 333-256332,
333-188629, 333-183476, and 333-165912 on Form S-8 of our reports dated February 21, 2024, relating to the
financial statements of Verisk Analytics, Inc., and the effectiveness of Verisk Analytics, Inc.’s internal control
over financial reporting, appearing in this Annual Report on Form 10-K, for the year ended December 31, 2023.
/s/ Deloitte & Touche LLP
Morristown, New Jersey
February 21, 2024
Exhibit 31.1
I, Lee M. Shavel, certify that:
CERTIFICATION
1. I have reviewed this annual report on Form 10-K of Verisk Analytics, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures
to be designed under our supervision, to ensure that material information relating to the registrant, including its
consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in
which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an
annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal
control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s
board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over financial reporting.
Date: February 21, 2024
/s/ Lee M. Shavel
Lee M. Shavel
Chief Executive Officer
Exhibit 31.2
I, Elizabeth D. Mann, certify that:
CERTIFICATION
1. I have reviewed this annual report on Form 10-K of Verisk Analytics, Inc.;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in light of the circumstances under which such
statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal
control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and
have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information relating to the
registrant, including its consolidated subsidiaries, is made known to us by others within those entities,
particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over
financial reporting to be designed under our supervision, to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in
this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of
an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of
internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s
board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control
over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record,
process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over financial reporting.
/s/ Elizabeth D. Mann
Elizabeth D. Mann
Chief Financial Officer
(Principal Financial Offer and Fully Authorized
Officer)
Date: February 21, 2024
Exhibit 32.1
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
The certification set forth below is being submitted in connection with the annual report on Form 10-K
of Verisk Analytics, Inc. (the “Company”) for the year ending December 31, 2023, as filed with the Securities
and Exchange Commission (the “Report”), for the purpose of complying with Rule 13a-14(b) or Rule 15d-14(b)
of the Securities Exchange Act of 1934 (the “Exchange Act”) and Section 1350 of Chapter 63 of Title 18 of the
United States Code.
Lee M. Shavel, the Chief Executive Officer of the Company, and Elizabeth D. Mann, the Chief
Financial Officer of the Company, each hereby certifies that, to the best of his/her knowledge:
1. the Report fully complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and
2. the information contained in the Report fairly presents, in all material respects, the financial
condition and results of operations of the Company.
/s/ Lee M. Shavel
Lee M. Shavel
Chief Executive Officer
/s/ Elizabeth D. Mann
Elizabeth D. Mann
Chief Financial Officer
(Principal Financial Offer and Duly Authorized
Officer)
Date: February 21, 2024
Corporate Headquarters
545 Washington Boulevard
Jersey City, NJ 07310-1686
201-469-3000
www.verisk.com
Investor Relations
Email: ir@verisk.com
201-469-3000
http://investor.verisk.com
Stock Transfer Agent
EQ Shareowner Services
1110 Centre Pointe Curve, Suite 101
Mendota Heights, MN 55120
1-800-488-9716
Outside Legal Counsel
Davis Polk & Wardwell LLP
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
This annual report is printed on paper certified
by the Forest Stewardship Council® (FSC®). The FSC
promotes environmentally sound, socially beneficial,
and economically prosperous forest management.
© 2024 Verisk Analytics, Inc. Verisk Analytics is a registered trademark and Verisk and the Verisk logo are trademarks of Insurance Services Office, Inc. Sequel Impact is a registered trademark of Sequel
Business Solutions Ltd. All other product or corporate names are trademarks or registered trademarks of their respective companies. Z240049 (3/24)
Verisk Analytics, Inc.
545 Washington Boulevard, Jersey City, NJ 07310-1686
201-469-3000 www.verisk.com