Verisk Analytics Inc.

ticker: VRSK step: 01 generated: 2026-05-12 source: quick-research

Verisk Analytics Inc. (VRSK) — Business Overview

Business Description

Verisk Analytics is the dominant data analytics and risk assessment platform for the global property & casualty (P&C) insurance industry, operating what is effectively a monopoly in several critical insurance data categories. Founded in 1971 (as Insurance Services Office, or ISO) and headquartered in Jersey City, New Jersey, Verisk provides the standardized loss costs, policy language, catastrophe models, and claims estimation tools that are embedded into the workflows of virtually every U.S. insurance carrier. After divesting its energy (Wood Mackenzie) and financial services segments in 2022–2023, Verisk is now a pure-play insurance analytics company with ~$3.1B in revenue and ~55% EBITDA margins.

Revenue Model

Verisk operates on a subscription-dominant model: ~81% of revenue is recurring subscription/license fees for perpetual access to proprietary data assets, analytical tools, and industry-standard forms. The remaining ~19% is transactional revenue tied to claims processing volume and usage-based services. Key revenue sources: (1) ISO/Underwriting: Standard policy language, loss cost filings, statistical reporting tools — regulatorily embedded across all 50 states; (2) AIR Worldwide (catastrophe modeling): Probabilistic models for hurricane, earthquake, flood risk used by insurers and reinsurers for capital planning; (3) Xactimate/XactAnalysis: Property claims estimation — the industry-standard tool used by adjusters, contractors, and carriers; (4) Verisk Claims: Fraud detection, subrogation analytics, CLUE (Comprehensive Loss Underwriting Exchange) database; (5) Verisk Underwriting: Risk scoring, aerial imagery analysis, property data.

Products & Services

• ISO Standard Forms & Loss Costs: Statutory insurance filings accepted across all U.S. jurisdictions — regulatory moat
• AIR Worldwide: Global catastrophe risk models (hurricane, earthquake, flood, wildfire) for P&C and reinsurance capital management
• Xactimate: #1 property claims cost estimation software; used by 60%+ of U.S. property adjusters
• XactGen / Exact AI: AI-powered claims document generation and generative AI tools for adjusters
• CLUE (Comprehensive Loss Underwriting Exchange): Claims history database shared across carriers — improves underwriting accuracy
• Verisk Predict: Predictive analytics for fraud, severity modeling, attorney involvement
• Aerial Imagery / Remote Sensing: Roof and property condition data from satellites/drones for underwriting accuracy

Customer Base & Go-to-Market

Verisk serves all top 100 U.S. P&C insurance carriers, as well as reinsurers, Lloyd's of London syndicates, government agencies, and independent adjusters. The company sells primarily through multi-year enterprise contracts (3–5 years) with annual escalators. Revenue concentration is low — no single customer represents more than ~4% of revenue. Switching costs are extraordinarily high: insurers build underwriting rules, pricing algorithms, and regulatory filings around ISO data, making migration effectively impossible without multi-year and multi-million-dollar system overhauls.

Competitive Position

Verisk holds near-monopoly positions in several categories: (1) ISO standardized loss costs and policy language are filed with insurance regulators in all U.S. jurisdictions — any insurer must use ISO filings to use standard coverages; (2) AIR Worldwide competes with RMS (Moody's) and CoreLogic in catastrophe modeling but holds #1–2 market share; (3) Xactimate has >60% market share in property claims estimation with no comparable alternative. The network effects from contributory data (all carriers contribute claims data to improve shared models) and regulatory embedment create compounding barriers to entry. Morningstar assigns Verisk a Wide Moat rating.

Key Facts

• Founded: 1971 (as Insurance Services Office)
• Headquarters: Jersey City, New Jersey
• Employees: ~7,000
• Exchange: NASDAQ
• Sector / Industry: Industrials / Data & Analytics Services
• Fiscal Year End: December 31
• Market Cap: ~$35–40B

ticker: VRSK step: 04 generated: 2026-05-12 source: quick-research

Verisk Analytics Inc. (VRSK) — Financial Snapshot

Income Statement Summary

FY2025: Revenue $3.07B (+6.6%); gross margin ~69.9%; operating margin ~43.7%; Adj. EBITDA margin ~55%; FCF $1.2B (+30%). EPS growth ~10–12% on continued share buybacks. FY2022–FY2023 reflect the transition year as Wood Mackenzie/financial services segments were divested, leaving pure insurance analytics.

Cash Flow & Balance Sheet (FY2025)

Key Ratios (approximate, FY2025)

• P/E: ~35–40x | EV/EBITDA: ~28–30x | FCF Yield: ~3.0–3.5%
• Revenue Growth: +6.6% OCC | Adj. EBITDA Margin: ~55% | FCF Conversion: ~80% of Adj. EBITDA
• Subscription Revenue: ~81% of total | Net Revenue Retention: >100%

Growth Profile

Verisk is a compounding, wide-moat business with consistent mid-to-high single digit organic revenue growth driven by: (1) annual price increases on subscription contracts (typically 4–6% per year on the core ISO/underwriting products); (2) volume growth as insurance policy counts and claims grow with the economy; and (3) new product adoption (AI-powered claims tools, aerial imagery, advanced analytics). The Adj. EBITDA margin has expanded ~100–150 bps per year as the company scales its high fixed-cost platform. Following the divestiture of lower-margin segments, the pure-play insurance analytics profile is cleaner and more predictable than ever.

Forward Estimates

• FY2026: Organic constant currency revenue growth 6–8% (management 3-year guidance); Adj. EBITDA margin targeting 56–57%; FCF ~$1.3–1.4B; EPS $7.80–8.20
• 3-Year Target: 6–8% OCC revenue growth + 100 bps margin expansion per year + ~3–4% share count reduction = ~12–15% EPS CAGR
• Capital Return: ~$1.2–1.5B annual buybacks + $0.40/share quarterly dividend (~0.7% yield)