Verisk Analytics (VRSK) 10-K risk factor changes: FY2016 vs FY2015

In such case, the trading price of our [removed: securities] [added: securities,] including our common [removed: stock] [added: stock,] could decline due to any of these risks, and you may lose all or part of your investment.

We could lose our access to data from external [removed: sources] [added: sources,] which could prevent us from providing our solutions.

We depend upon data from external sources, including data received from customers and various [removed: government] [added: government,] and public record services, for information used in our databases.

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 [removed: which] [added: that] allows us to legally use and/or process the data.

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 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 [removed: results] [added: results,] and cash flows.

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 [added: data] sources.

During the year ended December 31, [removed: 2015,] [added: 2016,] approximately [removed: 44%] [added: 48.9%] of our revenue was derived from solutions provided to U.S. P&C primary insurers.

Also, 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 [added: that are] beyond our control.

| • | changes in the business analytics [removed: industry;] [added: industry,] |

| • | changes in [removed: technology;] [added: technology,] |

| • | our inability to obtain or use state fee schedule or claims data in our insurance [removed: solutions;] [added: solutions,] |

| • | saturation of market [removed: demand;] [added: demand,] |

| • | loss of key [removed: customers;] [added: customers,] |

| • | industry [removed: consolidation;] [added: consolidation,] and |

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 [removed: acquirees.][added: investments.]

Any acquisitions or investments will be accompanied by the risks commonly encountered in [added: the] acquisitions of businesses.

| • | 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 [removed: policies;] [added: policies,] |

| • | paying more than fair market value for an acquired company or [removed: assets;] [added: assets,] |

| • | failing to integrate the operations and personnel of the acquired businesses in an efficient, timely [removed: manner;] [added: manner,] |

| • | assuming potential liabilities of an acquired [removed: company;] [added: company,] |

| • | managing the potential disruption to our ongoing [removed: business;] [added: business,] |

| • | distracting management focus from our core [removed: businesses;] [added: businesses,] |

| • | failing to retain management at [added: the] acquired [removed: company;] [added: company,] |

| • | difficulty in acquiring suitable businesses, including challenges in predicting the value an acquisition will ultimately contribute to our [removed: business;] [added: business,] |

| • | possibility of overpaying for acquisitions, particularly those with significant intangible assets that derive value using novel tools and/or are involved in niche [removed: markets;] [added: markets,] |

| • | impairing relationships with employees, customers, and strategic [removed: partners;] [added: partners,] |

| • | incurring expenses associated with the amortization of intangible assets particularly for intellectual property and other intangible [removed: assets;] [added: 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 [removed: benefits;] [added: benefits,] and |

Therefore, future acquisitions may require us to obtain additional financing through debt or equity, which may not be available on favorable terms or at all and [removed: would] [added: could] result in dilution.

There may be consolidation in our end customer market, which [removed: would] [added: could] reduce the 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 [removed: and healthcare services] sector.

Any of these developments could materially [removed: and] adversely affect our business, financial condition, operating [removed: results] [added: results,] and cash flows.

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 [added: distribution to protect our proprietary technology.]

[removed: Business] [added: Businesses] we acquire also often involve intellectual property portfolios, which increase the challenges we face in protecting our strategic advantage.

Our protection of our intellectual property rights in the [removed: United States] [added: U.S.] or abroad may not be adequate and others, including our competitors, may use our proprietary technology without our consent.

Such litigation could result in substantial costs and diversion of resources and could harm our business, financial condition, results of [removed: operations] [added: operations,] and cash flows.

There has been substantial litigation and other proceedings, particularly in the [removed: United States,] [added: U.S.,] regarding patent and other intellectual property rights in the information technology industry.

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 [removed: operating our business generally, or require changes to be made to our technologies and solutions.]

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 [removed: and] adversely affect our business, reputation, financial condition, operating [removed: results] [added: results,] and cash flows.

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, [removed: Health Insurance Portability and Accountability Act,] the European Union’s Data Protection Directive, the Dodd Frank Wall Street Reform and Consumer Protection Act and to a lesser extent, various other federal, state, and local laws and regulations.

operating our business generally, or require changes to be made to our technologies and solutions.

In addition, on October 6, 2015 the Court of Justice of the European Union, or E.U., invalidated the Safe Harbor provisions used by the Company and numerous other U.S. businesses to comply with E.U.’s Data Protection Directive 95/46/EC.

The Company has implemented various measures to comply with the Data Protection Directive, however, there can be no assurances that such methods will not be invalidated as well.

If the Company is unable to comply with the transfer mechanisms adopted pursuant to the Data Protection Directive, it will impede the 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.

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 in 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.

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) released its Base Erosion and Profit Shifting (BEPS) action plans which may also lead to future tax reform that could affect our results.

In addition, our tax positions are impacted by fluctuations in our earnings and financial results in the various countries in which we do business.

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.

varied protection for intellectual property rights in some countries.

Economic and political instability and potential unfavorable changes in laws and regulations resulting from the U.K.’s exit from the E.U. could adversely affect our financial condition, results of operations and cash flows.

The results of the referendum on June 23, 2016 in the U.K., to exit the E.U., which is commonly referred to as “Brexit,” and to potentially significantly change the U.K.’s relationship with the E.U. and the laws and regulations impacting business conducted between the U.K. and E.U. countries could disrupt the overall stability of the E.U. given the diverse economic and political circumstances of individual E.U. countries and negatively impact our European operations.

An immediate consequence of the Brexit vote was an adverse impact to global markets, including currency markets which experienced a sharp drop in the value of the British pound.

Longer term, Brexit will require negotiations regarding the future terms of the U.K.’s relationship with the E.U., which could result in the U.K. losing access to certain aspects of the single E.U. market and the global trade deals negotiated by the E.U. on behalf of its members.

The Brexit vote and the perceptions as to the impact of the withdrawal of the U.K. may adversely affect business activity, political stability and economic conditions in the U.K., the E.U. and elsewhere, the impact of which could have an adverse effect our financial condition, results of operations and cash flows.

beneficial to our existing stockholders.

distribution to protect our proprietary technology.

proprietary information.

Members of our senior management operating team have been with us for an average of almost 15 years.

The United States economy recently experienced periods of contraction and both the future domestic and global economic environments may continue to be less favorable than those of prior years.

condition.

On May 19, 2015, we consummated the acquisition of Wood Mackenzie (the “Acquisition”).

In order to finance the Acquisition, we incurred $2,180.0 million of indebtedness.

As of December 31, 2015, we had total consolidated indebtedness of approximately $3,168.0 million, and our leverage ratio (debt to EBITDA) increased from 1.57x at March 31, 2015 to 2.89x.

Our increased leverage resulting from the Acquisition could adversely affect our business.

We may not realize the expected benefits of the Acquisition.

We may fail to realize all the expected benefits of the Acquisition or successfully integrate Wood Mackenzie’s operations or preserve its customers and employees in an efficient or timely manner.

The necessity of coordinating geographically separated organizations, systems and facilities and addressing possible differences in business backgrounds, corporate cultures and management philosophies may increase the difficulties of integration.

This integration effort may also distract our management’s focus from our existing core businesses or impair our existing relationships with employees, customers and our strategic partners.

We may not be able to achieve the targeted operating or long-term strategic benefits of the Acquisition or could incur higher transition costs.

An inability to realize the full extent of, or any of, the anticipated benefits of the Acquisition, as well as any delays encountered in the integration process or an inability to integrate the operations of the two companies could have a material adverse effect on our financial condition, results of operations and cash flows.

As a result, the percentage of our revenues generated outside of the United States has increased materially.

We are [added: one of] the largest [removed: aggregator] [added: aggregators] and [removed: provider] [added: providers] of data pertaining to U.S. property and casualty, or P&C, insurance risks.

We offer predictive analytics and decision support solutions to customers in rating, underwriting, claims, catastrophe and weather risk, global risk analytics, natural resources intelligence, [removed: economic forecasting,] and many other fields.

Our customers use our solutions to make better [removed: risk] decisions with greater efficiency and discipline.

These solutions take various forms, including data, statistical models or tailored analytics, all designed to allow our [removed: clients] [added: customers] to make more logical decisions.

Our Risk Assessment segment revenues represented [removed: approximately 33.3%] [added: 36.3%] and [removed: 37.2%] [added: 39.1%] of our revenues for the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] respectively.

Our Decision Analytics segment provides solutions to our customer in insurance, [removed: financial services, healthcare, and] energy and specialized [removed: markets.][added: markets, and financial services.]

Our Decision Analytics segment revenues represented approximately [removed: 66.7%] [added: 63.7%] and [removed: 62.8%] [added: 60.9%] of our revenues for the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] respectively.

On [added: June 1, 2016 and] March 11, 2014, we sold our [added: healthcare business, Verisk Health, and] mortgage services business, Interthinx, [removed: Inc., or Interthinx.][added: respectively.]

Results of operations for the [added: healthcare and] mortgage services [removed: business] [added: businesses] are reported as [removed: a] discontinued [removed: operation] [added: operations] for the year ended December 31, [removed: 2014] [added: 2016] and for all prior periods presented.

We believe our business’s ability to [removed: generate] [added: grow] recurring revenue and [added: generate] positive cash flow is the key indicator of the successful execution of our business strategy.

We use [removed: year over year] [added: year-over-year] revenue [removed: growth] and EBITDA [removed: margin] [added: growth] as metrics to measure our performance.

EBITDA and EBITDA margin are non-GAAP financial measures (see Note [removed: 3] [added: 2] within Item 6.

We use [removed: year over year] [added: 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 [removed: customers] [added: customers,] and strategic acquisitions of new businesses.

We earn revenues through subscriptions, long-term agreements and on a transactional [removed: basis.][added: basis, recurring and non-recurring.]

For the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014, 25.3%] [added: 2015, 16.5%] and [removed: 27.7%] [added: 17.2%] of our [removed: revenues, respectively,] [added: revenues] were derived from providing transactional [removed: solutions.][added: recurring and non-recurring solutions, respectively.]

We earn [removed: transactional] [added: these] revenues as our solutions are delivered or services performed.

In general, [removed: transactions] [added: they] are billed monthly at the end of each month.

[removed: Approximately 90.1%] [added: For the the years ended December 31, 2016] and [removed: 89.6%] [added: 2015, 92.0% and 90.1%] of the revenues in our Risk Assessment segment [removed: for the years ended December 31, 2015 and 2014, respectively,] were derived from subscriptions and long-term agreements for our [removed: solutions.][added: solutions, respectively.]

[removed: Approximately 67.0% and 61.9%] [added: Our customers in this segment include most] of the [removed: revenues] [added: P&C insurance providers] in [removed: our Decision Analytics segment, for] the [added: U.S. For the] years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014, respectively,] [added: 2015, 78.6% and 78.1% of the revenues in our Decision Analytics segment] were derived from subscriptions and long-term agreements for our [removed: solutions.][added: solutions, respectively.]

Personnel expenses are [removed: the] [added: a] major component of both our cost of revenues and selling, general and administrative expenses.

Personnel expenses, which represented [removed: 57.1%] [added: 47.7%] and [removed: 56.8%] [added: 46.5%] of our total expenses for the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] respectively, include salaries, benefits, incentive compensation, equity compensation costs, sales commissions, employment taxes, recruiting costs, and outsourced temporary agency costs.

A significant portion of our other operating costs, such as facilities and communications, are [removed: also] either captured within cost of revenues or selling, general and administrative expense based on the nature of the work being performed.

However, part of our corporate strategy is to invest in new [removed: solutions] [added: solutions,] which may offset margin expansion.

A portion of the other operating costs such as facilities, insurance and communications are [removed: also] allocated to selling, general and administrative costs based on the nature of the work being performed by the employee.

We serve customers in [removed: four] [added: three] primary vertical markets: [removed: property/casualty] [added: P&C] insurance, [removed: healthcare,] energy, and financial services.

A significant change in [removed: property/casualty] [added: P&C] insurers’ profitability could [removed: positively or negatively] affect [added: the] demand for our solutions.

Growth in [removed: property/casualty] [added: P&C] insurers’ direct written premiums is 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 4.4% in 2012, 4.3% in 2013, [removed: and] 4.4% in [removed: 2014.][added: 2014 and 3.7% in 2015.]

Trends in catastrophe and [removed: noncatastrophe] [added: non-catastrophe] weather losses can have an effect on our customers’ [removed: profitability] [added: profitability,] and [removed: therefore] [added: therefore,] their appetite for buying analytics to help them manage their risks.

[removed: The apparent] [added: Any] increase [added: or decrease] in [removed: the] frequency [removed: and] [added: or] severity of weather events [removed: that cause losses for insurers] [added: over time] could lead to [added: an] increased [added: or decreased] demand for our catastrophe modeling, catastrophe loss information, and repair cost solutions.

We also have a portion of our revenue related to the number of claims processed due to [removed: losses] [added: losses,] which can be impacted by seasonal storm activity.

The need by our customers to fight insurance fraud [removed: —] [added: -] both in claims and at policy inception [removed: —] [added: -] could lead to increased demand for our underwriting and claims solutions.

We are adapting our offerings to address the needs of alternative lenders, backed by our deep expertise [removed: in] and datasets covering the performance of customers across a full range of credit histories.

A strengthening of the U.S. dollar relative to the currencies of our international [removed: clients] [added: customers] and a softening of the global economy is putting an even greater level of [removed: downward pressure on our revenues from such clients.]

However, we are also observing a growing appetite for our [removed: expense] [added: expense-focused solutions] and [removed: regulatory focused] [added: regulatory-focused] solutions among those [removed: clients.][added: customers.]

Lastly, we are seeing a greater number of companies entering the [removed: ad] [added: media] effectiveness space, [added: which encourages] potential competitors to [added: challenge] our position in this space.

Trends in the energy, [added: chemicals, and] metals and mining sectors and activity in financial markets can influence our revenues.

Movements of commodity prices affect the profitability of [removed: energy] [added: our customers, which include energy, chemicals,] and metals and mining companies, while stock markets and mergers and acquisitions, or M&A, are [added: some of] the principal drivers [removed: of activity for] [added: affecting our] financial [removed: institutions.][added: institution customers.]

[removed: Longer term the Paris global accord on climate change signals a period of change in the energy mix,] [added: The ongoing] incentivizing [added: of] growth in renewable energy and other low carbon [removed: technologies,] [added: technologies around the world will help drive this,] while fossil fuels are expected to remain a core part of energy demand for the foreseeable future.

We will continue to evolve our offerings to meet the needs of our [removed: clients] [added: customers] in an increasingly complex market.

We enable our customers to make better decisions about risk, investments, and operations with greater precision, efficiency, and discipline.

We also help customers across the globe protect and grow the value of people, property and financial assets.

Refer to Item 1.

Business for further discussion.

The respective GAAP financial measures are net income and net income margin.

EBITDA growth.

We use EBITDA growth as a proxy for the cash generated by the business.

EBITDA growth serves as a measure of our ability to balance the size of revenue growth with cost management and investing for future growth.

We also provide advisory services, which help our customers get more value out of our analytics and their subscriptions.

Likewise, any structural changes in the reinsurance and related brokerage industry from the recent influx of alternative capital or newer technologies could affect demand for our products.

Among the trends influencing commodity prices are supply and demand factors, regulatory requirements, fiscal impacts, regional market structures, and geopolitical risks.

Following the Organization of the Petroleum Exporting Countries, or OPEC, meeting in November 2016, oil prices have begun to recover indicating an uplift across the energy sector.

After a prolonged slump in the metals and mining sector, there are emerging signs of optimism in the copper, aluminum and lithium markets among others.

M&A activity is also beginning to improve with high profile asset sales from Shell, Total, and BP among others.

In addition, we have seen some large investments being made, notably the Glencore and Qatar deal with Rosneft, and the separate GE-Baker Hughes proposed transaction.

Furthermore, Wood Mackenzie expects final investment decisions in the oil and gas sector to significantly increase in 2017, albeit from recent lows.

However, volatility in commodity prices means uncertainty for our customers, which can impact their demand for our data and services.

Notwithstanding the unsettled view of the U.S. leadership towards the Paris global accord on climate change, over the longer term Wood Mackenzie expects a period of change in the energy mix.

downward pressure on our revenues from such customers.

On November 23, 2016, we acquired the net assets of IntelliStance, LLC, or MarketStance, a provider of market intelligence data and analytics to the property/casualty insurance market.

MarketStance has become part of ISO within the Risk Assessment segment.

MarketStance has built a proprietary analytics model to provide actionable insights on customer's profitability and that enhances our offerings.

On November 11, 2016, we acquired 100 percent of the stock of The GeoInformation Group Limited, or GeoInformation, a provider of geographic data solutions.

GeoInformation offers mapping services and geospatial data and analytic solutions to companies and public sector organizations.

GeoInformation's resources complement the risk management and predictive analytics capabilities internationally within the Risk Assessment segment.

On October 20, 2016, we acquired 100 percent of the stock of Analyze Re, Inc., or Analyze Re, a software analytics provider for the reinsurance and insurance industries.

Analyze Re has become part of our insurance vertical within the Decision Analytics segment and enables us to provide our customers with additional real-time pricing, exposure management, and enterprise portfolio roll-up capabilities.

On August 19, 2016, we acquired the net assets of data and subscriptions business of Quest Offshore Resources, Inc, or Quest Offshore, which supplies market intelligence to the offshore oil and gas sector.

The data and subscriptions business has become part of Wood Mackenzie within the Decision Analytics segment and complements its existing upstream analysis expertise.

See Note 9 to our consolidated financial statements included in this annual report on Form 10-K for further discussions.

On July 26, 2016,we acquired 100 percent of the stock of Greentech Media, Inc., or Greentech Media, an information services provider for the electricity and renewables sector.

Greentech Media has become part of Wood Mackenzie within the Decision Analytics segment and enables Wood Mackenzie to provide its customers with market intelligence across several categories, including solar generation, energy storage, and smart grids that react to changes in supply and demand.

See Note 9 to our consolidated financial statements included in this annual report on Form 10-K for further discussions.

On April 14, 2016, we acquired 100 percent of the stock of Risk Intelligence Ireland Limited, or RII, a provider of fraud detection, compliance, risk control, and process automation services to the Irish insurance industry.

RII enhances the ability of the Company's Risk Assessment segment to serve the international insurance market.

See Note 9 to our consolidated financial statements included in this annual report on Form 10-K for further discussions.

See Note 9 to our consolidated financial statements included in this annual report on Form 10-K for further discussions.

On June 1, 2016, we sold our healthcare business, Verisk Health, for a price of $714.6 million.

Excluding revenues of $151.0 million from Wood Mackenzie (for the first and second quarters), Infield, PCI, RII, Greentech Media, Quest Offshore, Analyze Re, GeoInformation, and MarketStance, collectively referred to as our recent acquisitions, our revenue growth was $83.5 million or 4.9%.

Revenues within our Decision Analytics segment, excluding our recent acquisitions of Wood Mackenzie (for the first and second quarters), Infield, PCI, Greentech Media, Quest Offshore and Analyze Re, increased by $49.3 million or 4.8%.

We enable risk-bearing businesses to better understand and manage their risks and opportunities associated with those risks.

Our customers in this segment include most of the P&C insurance providers in the United States.

In this segment, customer bases are within the insurance, financial services, energy and specialized markets, and healthcare verticals.

A significant decrease in the number or severity of catastrophes could negatively affect our revenues.

Among the specific trends influencing commodity prices are global gross domestic product growth, supply of individual commodities, and geopolitical factors.

The slow down of the Chinese economy is currently contributing to an oversupply of a number of commodities.

Rising U.S. oil and gas production, OPEC policy, and the partial lifting of sanctions against Iran in January 2016 has led to a sharp fall in crude oil prices; and most metals markets are currently in oversupply.

Lower commodity prices have reduced discretionary spending for clients and has stalled M&A activity.

However, the uncertainty also increases client demand for our data and services.

Commodity prices are expected to recover over time to incentivize the investment required to meet growing energy demand.

Trends in the U.S. healthcare market can affect a portion of our revenues in the Decision Analytics segment.

That market continues to undergo significant change as the result of healthcare reform legislation.

The specific trends affecting our current healthcare business include payment reform, expansion of insurance coverage, and efforts at cost containment.

Payment reform is driving the market to value-based reimbursement, which has caused healthcare providers to bear increased financial risk and responsibility for quality outcomes.

The expansion of insurance coverage has reduced the uninsured population through both

increased enrollment in Medicaid and in the commercial market through statewide health exchanges.

As the government seeks to control fraud, waste, and abuse, efforts to contain costs will likely continue to become more prevalent.

Although such changes have the potential to disrupt the healthcare marketplace, we believe the requirements for reform could increase demand for our analytic solutions in the areas of population health management, quality measurement, risk adjustment for Medicare Advantage and Qualified Health Plans participating on statewide health exchanges, and detection of prepayment fraud, waste and abuse.

We experience seasonality in our Medicare Advantage risk adjustment business in the second half of our fiscal year, related to the CMS submission deadline.

| | | (In thousands) | | | | | | | | |

| Insurance | $ | 647,161 | | | $ | 598,757 | | | 8.1 | % |

| Financial services | | 116,556 | | | | 96,763 | | | 20.5 | % |

| Healthcare | | 307,291 | | | | 315,628 | | | (2.6 | )% |

| Total Decision Analytics | $ | 1,379,819 | | | $ | 1,096,074 | | | 25.9 | % |

Our healthcare revenue decreased $8.3 million or 2.6% primarily due to changes in our customer contract language related to our revenue and quality intelligence solution.

For comparability, had the contract language also been in effect in the prior period, our revenue growth would have been 6.2%.

These increases were offset by a decrease in data costs and data processing fees of $21.2 million (mostly related to the change in our customer contract terms within our healthcare vertical described above).

| | | (In thousands) | | | | | | | | |

The increase in margin is primarily attributed to operating leverage in the segment as well as cost efficiencies.

In December 2014, we acquired Maplecroft within our Decision Analytics segment, a recent acquisition.

Maplecroft provided an increase of $0.6 million in revenues for the year ended December 31, 2014.

Excluding this recent acquisition, revenues increased $150.4 million or 9.4%.

Both categories,

The decrease was primarily due to lower salaries and employee benefits of $7.3 million mostly related to the executive transition that took place in 2013, travel expenses of $0.9 million, and a decrease in other general expenses of $2.5 million.

These decreases were offset by an increase in professional fees of $4.6 million, primarily related to our attempted acquisition of EVT, and information technology expense of $4.3 million.

Depreciation and amortization of fixed assets includes depreciation of furniture and equipment, software, computer hardware, and related equipment.

The decrease was primarily related to intangible assets associated with prior acquisitions that have been fully amortized.

The decrease was primarily due to the repayment of the private placement debt of $180.0 million during 2013, consisting of $45.0 million that matured in April 2013, $100.0 million that matured in August 2013 and $35.0 million that matured in October 2013.

Our recent acquisition accounted for an increase of $0.6 million in revenues for the year ended December 31, 2014.

Excluding Maplecroft, our Decision Analytics revenue increased $118.1 million or 12.1%.

At December 31, [removed: 2015,] [added: 2016,] we had borrowings outstanding under our credit facility of [removed: $870.0] [added: $100.0] million, which bear interest at variable rates based on LIBOR plus 1.125% to 1.625%, depending on certain ratios defined in the credit agreement.

Based on our overall interest rate exposure at December 31, [removed: 2015,] [added: 2016,] a one percent change in interest rate would result in a change in annual pre-tax interest expense of approximately [removed: $8.7] [added: $1.0] million based on our current borrowing levels.

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, [removed: 2015.][added: 2016.]

The information required by this Item is set forth on pages [removed: 49] [added: 54] through [removed: 98] [added: 102] of this annual report on Form 10-K.

Verisk Analytics is a leading data analytics provider serving customers in insurance, natural [removed: resources, healthcare, financial services, government,] [added: resources] and [removed: risk management.][added: financial services.]

We offer predictive analytics and decision support solutions to customers in rating, underwriting, claims, catastrophe and weather risk, [removed: global risk analytics,] natural resources intelligence, economic forecasting, and many other fields.

In the United [removed: States] [added: States, or U.S.,] and around the world, we help customers protect people, property, and financial assets.

We refer to these products and services as [removed: "solutions"] [added: solutions] due to the integration among our services and the flexibility that enables our customers to purchase components or [removed: the] [added: a] comprehensive package.

These [removed: "solutions"] [added: solutions] take various forms, including data, expert insight, statistical models [removed: or] [added: and] tailored [removed: analytics,] [added: analytics] all designed to allow our [removed: clients] [added: customers] to make more logical decisions.

In [removed: 2015,] [added: 2016,] our customers included all of the top 100 [removed: Property] [added: property] and [removed: Casualty,] [added: casualty,] or P&C, insurance providers in the U.S. for the lines of P&C services we offer, [removed: 29] [added: and 28] of the top 30 credit card issuers in North America, the United Kingdom and Australia, as well as [removed: 9] [added: 8] of the top 10 [removed: health plan] [added: global energy] providers [removed: in the U.S. We also work with a wide range of companies, governments and institutions across] [added: around] the [removed: energy, metals and mining value chains.][added: world.]

We believe that Verisk is uniquely positioned because of the set of [removed: distinctives-or] [added: distinctives or] competitive [removed: advantages-we] [added: advantages we] cultivate and continue to expand.

Our [removed: legacy] [added: existing] businesses, in addition to new product innovations, integrate [removed: these] [added: the following] four singular qualities into the foundation of our strategy.

[removed: Generally speaking,] [added: Typically,] the marketplace assumes that those that are first to market are superior to the competition and better positioned to succeed.

We offer our solutions and services primarily through annual subscriptions or long-term agreements, which are typically pre-paid and represented [removed: approximately 75%] [added: over 80%] of our revenues in [removed: 2015.][added: 2016.]

For the year ended December 31, [removed: 2015,] [added: 2016,] we had revenues of [removed: $2,068.0] [added: $1,995.2] million and net income of [removed: $507.6] [added: $591.2] million.

For the five year period ended December 31, [removed: 2015,] [added: 2016,] our revenues and net income grew at a compound annual growth rate, or CAGR, of [removed: 14.8%] [added: 13.9%] and 15.8%, respectively.

We trace our history to 1971, when Insurance Services Office, Inc., or ISO, started operations as a not-for-profit advisory and rating organization providing services [removed: for] [added: to] the U.S. P&C insurance industry.

Over the past two decades, we have transformed our business beyond its original functions by deepening and broadening our data assets, developing a set of integrated risk management solutions and services and addressing new [removed: markets through our Decision Analytics segment.][added: markets.]

To further expand our [removed: Decision Analytics segment,] [added: business, in 2002,] we acquired AIR Worldwide, or AIR, [removed: in 2002,] the technological leader in catastrophe modeling.

In 2006, to bolster our position in the insurance claims field we acquired Xactware, a leading supplier of [removed: estimating] [added: estimation] software for professionals involved in building repair and reconstruction.

[removed: Also in] [added: In] 2012, we acquired Argus Information & Advisory Services, LLC, or Argus, to expand our [added: global] presence [removed: in] providing information, competitive benchmarking, analytics, and customized services to financial institutions in the payments [removed: space globally.][added: space.]

[removed: These] [added: Those] acquisitions have added scale, geographic reach, highly skilled workforces, and a wide array of new capabilities to [added: support] our [removed: Decision Analytics segment.][added: customers.]

Verisk common stock began trading on the NASDAQ Global Select Market on October 7, [removed: 2009] [added: 2009,] under the symbol “VRSK.”

Our Risk Assessment segment serves our P&C insurance customers and focuses on prediction of [removed: loss and] [added: loss,] selection and pricing of [removed: risk.][added: risk, and compliance with their reporting requirements in each U.S. state in which they operate.]

Our customers include most of the P&C insurance providers in the U.S. [added: In recent years we have expanded our offerings to also serve certain non-U.S. markets.]

To meet their needs, we process [added: approximately 2,400 regulatory filings] and interface with state regulators in all 50 states plus the District of Columbia, Guam, Puerto Rico and the Virgin Islands [removed: approximately 2,800 regulatory filings] each year [removed: ensuring] [added: 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 [removed: make sure] [added: ensure] that such insurers’ policies meet basic coverage requirements.

Our policy language includes standard coverage language, endorsements and policy writing support language that assist our customers in understanding the risks they assume and the coverages they [removed: are offering.][added: offer.]

We have [removed: over 107] [added: more than 120] specialized lawyers and insurance experts reviewing changes in each state’s insurance rules and regulations, including [removed: on] [added: an] average [removed: over 16,000] [added: of more than 16,500] legislative bills, [removed: 1,900] [added: 6,100] regulatory actions and 2,000 court cases per year, to make any required changes to our policy language and rating information.

For example, in the [removed: homeowner’s] [added: homeowners] line of insurance, we maintain policy language and rules for 6 basic coverages, [removed: 261] [added: 289] national endorsements, and [removed: 602] [added: 601] state-specific endorsements.

[removed: Overall, we] [added: We] provide policy language, prospective loss costs, policy writing rules, and a variety of other solutions for 26 lines of insurance.

Our statistical agent services have enabled P&C insurers to meet [removed: these] [added: those] regulatory requirements for [removed: over 40] [added: more than 45] years.

We aggregate the [removed: data and,] [added: data, and] as a licensed or appointed “statistical agent” in all 50 states, Puerto Rico, and the District of Columbia, we report [removed: these] [added: those] statistics to insurance regulators.

Each year, P&C insurers send us approximately [removed: 3.4] [added: 3.5] billion detailed individual records of insurance transactions, such as insurance premiums collected or losses incurred.

We maintain a database of [removed: over 19.0] [added: more than 20.0] billion statistical records, including approximately [removed: 7.8] [added: 8.2] billion commercial lines records and approximately [removed: 11.2] [added: 11.8] billion personal lines records.

We collect [removed: unit-transaction] [added: unit transaction] detail of each premium and loss record, which enhances the validity, reliability and accuracy of our data sets and our actuarial analyses.

Our proprietary quality process includes [removed: over 2,500] [added: more than 2,800] separate checks to ensure that [added: the] data [removed: meet] [added: meets] our high standards of quality.

In addition, our actuarial consultants provide customized services for our [removed: clients] [added: customers] 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 project [added: customers'] future losses and loss expenses [removed: utilizing] [added: using] a broad set of data.

[removed: These] [added: Those] projections tend to be more reliable than if our customers used [removed: solely] their own [removed: data.][added: data exclusively.]

We gather information on individual properties and communities so that insurers can use our information to evaluate and price personal and commercial property insurance, as well as [added: business owners, or BOP,] commercial [added: auto and general] liability [removed: insurance.][added: insurance, and workers compensation coverages.]

Our property-specific rating and underwriting information allow our customers to understand, quantify, underwrite, mitigate, and avoid potential loss [removed: for] [added: to] commercial properties.

Our [removed: database] [added: ProMetrix operating platform] contains [added: business and risk information on 26 million entities,] loss costs and other vital information on more than [removed: 3.6] [added: 3.7] million commercial buildings in the [removed: United States] [added: U.S.] and also holds information on more than [removed: 6.4] [added: 6.5] million individual businesses occupying those buildings.

We have a staff of [removed: more than] [added: approximately] 600 field representatives strategically located around the [removed: United States] [added: 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.

By building on our insurance industry expertise and recent acquisitions, we have expanded our solution set to serve customers in certain non-U.S. markets.

areas.

We have begun to expand our footprint of data and solutions to include both U.S. and international markets.

Our solutions are built on unique data sets which are dynamic and updated based on new data and events.

Our insurance solutions provide our customers analytics in the areas of fraud detection, catastrophe modeling, loss estimation, and underwriting, including emerging areas of interest within these categories.

Our newest model also addresses cyber losses.

The program allows our customers to sketch floor plans, roof plans

We also are a leading provider of solutions for the personal underwriting markets, including homeowners and auto lines.

We build and maintain widely used, industry-standard tools that assist insurers in underwriting and rating, i.e., measuring and selecting risks and pricing coverage appropriately to 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 quickly and precisely gauge the degree and cost of risk.

Our solutions span a wide range of property/casualty insurance, encompassing personal and commercial lines of coverage that protect private residences, private and commercial vehicles, and businesses.

We continually pursue new solutions that help our customers to keep abreast of changing markets and technology.

For example, we provide tools and platforms to help insurers, their customers, and providers of products and services to leverage the growing “Internet of Things.” This technology connects devices, vehicles, and homes to the Internet and generates valuable data to underwrite, rate, and manage risk while enriching customer relationships.

By ingesting, storing, and normalizing this data, Verisk makes it accessible for users to extract business insights at a significantly lower cost and logistical burden than they could achieve on their own.

We work with our customers to evaluate current market and audience selection.

We measure the effectiveness of campaigns across the various media and the impact of multi-channel campaigns.

We provide research and consulting services focusing on exploration strategies and screening, asset development and acquisition, commodity markets, and corporate analysis.

We offer consultancy in the areas of business environment, business improvement, business strategies, commercial advisory, and transaction support.

We deliver analysis and advice on assets, companies,

governments, and markets.

We work with a range of diverse teams, from strategy and policy makers, business developers and market analysts to corporate finance, risk teams and investors.

our actuarial services and industry-standard insurance programs.

We also work with a wide range of companies, governments and institutions across the energy, and metals and mining value chains.

However, we believe none of our competitors have the breadth or depth of data we have.

As of December 31, 2016, we had a sales force of 295 people in our continuing operations.

Tier One or “Global/National” Accounts, is comprised of our largest customers.

Tier Two, or “Strategic” Accounts, represent both large and middle-market customer groups.

In Tier One and Tier Two segments, we have sales teams organized by the following specialities: Rating, Underwriting, Claims, Catastrophe Risk, and Energy.

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 innovation partnership opportunities.

created from their data.

The data center in Somerset, New Jersey is the recovery site for the Lehi, Utah data center and vice versa.

for our ISO Claims Outcome Advisor® software and our Xactware Sketch® product.

As of December 31, 2016, we employed 6,148 full-time and 166 part-time employees in our continuing operations.

Today, those businesses form the core of our Risk Assessment segment.

In 2004, we entered the healthcare space by acquiring several businesses that now offer web-based analytical and reporting systems for health insurers, provider organizations and self-insured employers.

In 2005, we entered the mortgage sector, acquiring the first of several businesses that provided automated fraud detection, compliance and decision support solutions for the U.S. mortgage industry, which we sold in March 2014.

In 2010, we acquired 3E Company, creating a scale presence in supply chain and environmental health and safety.

In 2011 and 2012, we further bolstered our healthcare solutions by acquiring Health Risk Partners, LLC, or HRP, which provides solutions to optimize revenue, improve compliance and improve quality of care for Medicare Advantage health plans and MediConnect Global, Inc. or MediConnect, which provides medical record retrieval, digitization, coding, extraction, and analysis to the healthcare and property casualty industry.

In 2014, we acquired Maplecroft.Net Limited, or Maplecroft; as part of our risk management and supply chain solutions business, Maplecroft continues to deliver thorough analyses of geopolitical, societal, human rights, economic, and environmental risks for many countries in the world.

On October 1, 2010, we completed a follow-on public offering.

We did not receive any proceeds from the sale of common stock in the offering.

The primary purpose of the offering was to manage and organize the sale by Class B insurance company shareholders while providing incremental public float.

Concurrently with the closing of the offering, we repurchased shares of common stock, for an aggregate purchase price of $192.5 million, directly from selling shareholders owning Class B common stock.

We converted all Class B shares to Class A shares in 2011 and currently have no outstanding Class B shares.

On May 26, 2015, we eliminated the separate classes of common stock, and as a result, Verisk Class A and Class B common stock were renamed common stock.

Our senior management team, which includes our president and chief executive officer, chief financial officer, general counsel, and nine senior officers who lead our business and operational units, have been with us for an average of almost 15 years.

This team has led our transformation to a successful for-profit entity, focused on growth with our U.S. P&C insurer customers and expansion into a variety of new vertical markets, including healthcare, financial services, and energy and specialized markets.

Within this segment, we also provide solutions to help our insurance customers comply with their reporting requirements in each U.S. state in which they operate.

As we develop our models, our ability to provide value to our customers is enhanced by our solutions, which are constantly recalibrated by refreshed data of actual events.

We have developed models, covering natural

Healthcare

We offer payment accuracy solutions that help healthcare claims payors detect fraud, abuse and overpayment.

Our approach combines computer-based modeling and profiling of claims with analysis performed by clinical experts.

We run our customers’ claims through our proprietary analytic system to identify potential fraud, abuse and overpayment, and then a registered nurse, physician or other clinical specialist skilled in coding and reimbursement decisions reviews all suspect claims and billing patterns.

This combination of system and human review is unique in the industry and we believe offers improved accuracy for paying claims.

We analyze the patterns of claims produced by individual physicians, physicians’ practices, hospitals, dentists, and

pharmacies to locate sources of fraud.

After a suspicious source of claims is identified, our real-time analytic solutions investigate each claim individually for particular violations, including upcoding, multiple billings, services claimed but not rendered, and billing by unlicensed providers.

By finding the individual claims with the most cost-recovery potential and also minimizing the number of false-positive indications of fraud, we enable the special investigation units of healthcare payors to efficiently control their claims costs while maintaining high levels of customer service to their insureds.

We also offer web-based reporting tools that let payors take definitive action to prevent overpayments or payment of fraudulent claims.

The tools provide the documentation that helps to identify, investigate and prevent abusive and fraudulent activity by providers.

We provide enterprise analytics and reporting systems to health insurers, provider organizations and self-insured employers.

Those organizations use our healthcare business intelligence solutions to review their data, including information on claims, membership, providers and utilization, and provide cost trends, forecasts and actuarial, financial and utilization analyses.

For example, our solutions allow our customers to predict medical costs and improve the financing and organization of health services.

Our predictive models help our customers identify high-cost cases for care-and disease-management intervention, compare providers adjusting for differences in health, predict resource use for individuals and populations, establish health-based and performance-based payments, negotiate payments and incentives, negotiate premium rates, and measure return on investment.

We also provide our customers healthcare services using complex clinical analyses to uncover reasons behind cost and utilization increases.

Physicians and hospitals are adopting and acquiring new technologies, drugs and devices more rapidly than ever before.

We provide financial and actuarial analyses, clinical, technical and implementation services and training services to help our customers manage costs and risks to their practices.

We are a provider of solutions for revenue & quality intelligence and compliance for certain aspects of the healthcare industry.

We have systems, including our revenue integrity business, which analyze Medicare data for compliance with CMS (Centers for Medicare & Medicaid Services) guidelines, assist payers in payment integrity, data collection, and encounter data submission.

By using our ReconEdge™, a web-based risk adjustment reconciliation system, healthcare payers can assess their organizations’ opportunities and compliance in payments.

In addition, we offer proprietary systems and services that facilitate the aggregation, retrieval, coding, and analysis of medical records.

We have a repository of medical records that are digitized, indexed, and securely hosted online.

On September 9, 2015, we were served with a nationwide putative class action complaint filed in the Court of Common Pleas, Cuyahoga County in Ohio naming [removed: the Company’s] [added: our] subsidiary Intellicorp Records, Inc. (“Intellicorp.”) titled Sherri Legrand v.

Plaintiffs filed their First Amended Class Action Complaint on November 5, 2015 (“Amended Complaint”), which like the prior complaint claims violations of the Fair Credit Reporting Act [added: ("FCRA")] and alleges two putative class claims against Intellicorp, namely (i) a section 1681k(a) claim on behalf of all individuals who were the subjects of consumer reports furnished by Intellicorp which contained public record information in the “Government Sanctions” section of the report on or after September 4, 2013 and continuing through the date the class list is prepared and (ii) a section 1681e(b) claim on behalf of all individuals who were the subjects of consumer reports furnished by Intellicorp which contained public record information in the “Government Sanctions” section of the report where the address or social security number of the subject of the report do not match the social security number or address contained in the government database on or after September 4, 2013 and continuing through the date the class list is prepared.

[added: The Amended Complaint] alleges that defendants acted willfully and seeks statutory damages for the classes in an amount not less than one hundred dollars and not more than one thousand dollars per violation, punitive damages, equitable relief, costs and attorney’s fees.

On February 1, 2016, we were served with a nationwide putative class action complaint filed in the United States District Court for the Eastern District of North Carolina naming [removed: the Company’s subsidiary Intellicorp Records, Inc. (“Intellicorp.”) The complaint titled Frank DiSalvo v.][added: Intellicorp.]

Intellicorp Records, Inc. claims violations of the [removed: Fair Credit Reporting Act] [added: FCRA] and alleges a section 1681b(b)(1) claim on behalf of all individuals residing in the United States who were the subjects of consumer reports furnished by Intellicorp for employment purposes within the period prescribed by the FCRA, 15 U.S.C. Section 1681p without first obtaining from the user of the report a certification that such user had complied with the obligations under Section 1681b(b)(2) as to the subject of the consumer report.

[removed: The complaint alleges that the Company’s Roof InSight, Property InSight and Aerial Sketch products] infringe seven patents owned by Eagle View and Pictometry namely, Patent Nos. 436, 840, 152, 880, 770, 732 and 454 (collectively the [removed: “Patents-in-Suit.”)] [added: “Patents-in-Suit”)] On November 30, 2015, plaintiffs filed a First Amended Complaint [removed: (“Amended] [added: (“First Amended] Complaint”) adding Patent Nos. 376 and 737 to the Patents in Suit.

The [added: First] Amended Complaint seeks an entry of judgment by the Court that defendants have and continue to directly infringe and/or indirectly infringe, by way of inducement the Patents in Suit, permanent injunctive relief, damages, costs and attorney’s fees.

Interthinx, Inc. and Verisk Analytics, Inc. The plaintiff, a former employee of [removed: the Company’s] [added: our] former subsidiary Interthinx, Inc. in Missouri, filed the class action complaint in the United States District Court for the Eastern District of Missouri on behalf of all review appraisers and individuals holding comparable positions with different titles who were employed by Interthinx for the last three years nationwide and who were not paid overtime wages.

The action is brought by nineteen individual plaintiffs, on their own behalf and on behalf of a putative class, against more than 120 defendants, including us and [removed: our subsidiary, Insurance Services Office, Inc. ("ISO").][added: ISO.]

On January 15, 2016, the [removed: court] [added: Court] granted defendants’ motions to dismiss all claims asserted in the Third Amended [removed: Complaint and plaintiffs filed a Motion for Reconsideration on February 16,2016][added: Complaint.]

On February 19, 2016, we were served with a notice of a summons and complaint filed on January 29, 2016 against [removed: our subsidiary Insurance Services Office, Inc. (“ISO”)] [added: ISO] in the U.S. District Court for the District of Connecticut titled Halloran et al.

[removed: The] [added: As alleged in the First Amended Complaint, the] putative class action is brought [added: by four policyholders] on behalf of [removed: four policyholders and] [added: a class of] similarly situated policyholders in [removed: Eastern] [added: eastern] Connecticut who [removed: complain] [added: allege] that their homeowner’s insurance carriers [added: have] denied [added: or will deny] their claims for [removed: the deterioration and collapse of] [added: damage to] their [removed: foundations] [added: homes] caused by defective concrete.

It also alleges that ISO as the drafter of the standardized policy language at issue [removed: participated with over 100 insurance companies to deny claims for defective concrete and collapsed foundations and] violated the Connecticut Unfair Trade Practices [removed: (CUTPA)] [added: ("CUTPA")] and the Connecticut Unfair Insurance Practices Act [removed: (CUIPA).][added: ("CUIPA").]

The plaintiffs ask that the Court certify a class of persons similarly situated and seek [removed: recovery from over 100 insurance carriers equal to] [added: relief in] the [added: form of the] cost for the replacement of their concrete [removed: foundations, injunctive relief,] [added: foundations and a declaratory judgment that all of the defendant insurance carriers are obligated to provide coverage for claims resulting from the defective concrete as well as,] attorneys’ fees, costs and interest.

The complaint titled Frank DiSalvo v.

On April 18, 2016, the parties filed a joint motion to stay all proceedings pending the resolution of the United States Supreme Court’s decision in Spokeo v.

Robins, No. 13-1339.

After Spokeo was decided on May 16, 2016, plaintiffs voluntarily dismissed their federal court complaint and filed a virtually identical complaint in Ohio State court on May 27, 2016.

Defendants removed that complaint to the United States District Court for the Northern District of Ohio on July 1, 2016, which on defendant’s motion dismissed the complaint for failure to allege Article III standing and remanded the case to Ohio state court on September 27, 2016.

The parties agreed to resolve this matter for a non-material amount in the Settlement Agreement and Release executed on November 30, 2016.

The complaint alleges that our Roof InSight, Property InSight and Aerial Sketch products

On March 11, 2014, we sold 100 percent of the stock of Interthinx, Inc. The parties agreed to resolve this matter with our contribution of a non-material amount in the Class Action Settlement Agreement executed on November 8, 2016.

The hearing for the preliminary approval of the settlement is scheduled for February 21, 2017.

Plaintiffs filed a motion for reconsideration of this dismissal on February 16, 2016.

The Court granted defendants’ motion to strike the motion for reconsideration on March 2, 2016 and gave plaintiffs leave to file another motion for reconsideration in accordance with the rules which plaintiffs filed on March 11, 2016 and, which was denied by the Court on April 25, 2016.

On April 1, 2016, plaintiffs also filed a Notice of Appeal of the Court’s January 15, 2016 Order, which dismissed all claims in the Third Amended Complaint.

Plaintiffs also filed an appeal of the Court’s denial of the motion for reconsideration, which the Court of Appeals for the 10th Circuit consolidated with the appeal of the Court’s January 15, 2016 dismissal.

Appellants filed their brief in support of the consolidated appeal on July 21, 2016 and Appellees filed their brief in response on September 21, 2016.

The lawsuit alleges a breach of contract claim against certain insurers and seeks declaratory relief as to more than 100 other insurers.

On March 17, 2016 plaintiffs filed their first amended complaint asserting federal jurisdiction under the Class Action Fairness Act, adding a number of insurer defendants and amending their damages claim to include punitive damages.

After defendants indicated that they would be filing motions to dismiss the first amended complaint at a Rule 16 Conference on April 12, 2016, the Court gave plaintiffs until May 6, 2016 to move for leave to file a second amended complaint.

On May 6, 2016, plaintiffs filed a Motion to amend the first amended complaint with a proposed second amended complaint, which did not name ISO or us as a defendant.

No opposition was filed to the motion to amend, which was granted on October 4, 2016.

Instead of filing a second amended complaint, plaintiffs, in a joint motion for the modification of the case schedule filed on October 13, 2016, expressed their intention to move for leave to file a third amended complaint in order to drop certain additional defendants and to add other named plaintiffs.

Plaintiffs’ motion for leave to file a third amended complaint which does not name us as a defendant is pending before the District Court.

The Amended Complaint

At this time, it is not possible to determine the ultimate resolution of, or estimate the liability related to this matter.

At this time, it is not possible to determine the ultimate resolution of, or estimate the liability related to this matter.

On March 11, 2014, we sold 100 percent of the stock of Interthinx, Inc. At this time, it is not possible to determine the ultimate resolution of, or estimate the liability related to this matter.

MediConnect Global, Inc. Litigation

On October 11, 2013, we were served with a summons and complaint in an action titled Naveen Trehan v.

MediConnect Global, Inc., Amy Anderson and Verisk Health, Inc. filed on October 9, 2013 in the United States District Court for the District of Utah.

The complaint, brought by a former minority shareholder of the Company’s subsidiary, MediConnect Global, Inc., arises from MediConnect’s buyout of Naveen Trehan and his family members’ shares on October 15, 2010.

Plaintiff claims that the sale of the shares was based on MediConnect’s representations concerning third parties that had expressed interest in an acquisition, merger or investment in MediConnect at that time.

Plaintiff claims that MediConnect did not disclose the Company, which purchased MediConnect on March 23, 2012, as a possible suitor.

The complaint alleges four causes of action: (1) breach of fiduciary duty against MediConnect and Amy Anderson for failure to disclose the Company's interest in acquiring, merging with or investing in MediConnect prior to the buyout of his shares; (2) fraud against Amy Anderson and MediConnect for intentionally providing false information to plaintiff with the purpose of inducing him to agree to sell his shares at an artificially low price; (3) negligent misrepresentation against Amy Anderson and MediConnect for their negligent failure to discover and disclose the Company's

interest in acquiring MediConnect prior to the buyout of plaintiff’s shares and (4) a violation of SEC Rule 10b-5 against Amy Anderson and MediConnect for defrauding plaintiff and failing to disclose material information in connection with the sale of securities.

The complaint seeks joint and several recoveries from Amy Anderson and MediConnect for compensatory damages, punitive damages, and disgorgement of all profits earned through the investment of plaintiff’s funds, attorneys’ fees, interest and an order from the court that plaintiff’s funds be held in a constructive trust.

On November 2, 2015, the court issued a judgement in favor of the defendants and dismissed all claims with prejudice.

Plaintiff filed a Notice of Appeal on November 30, 2015.

The lawsuit alleges a breach of contract claim against insurers Harleysville, Nationwide and Kemper and an anticipatory breach of contract claim against insurer MetLife.

| [removed: þ] [added: ☑] | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |

For the fiscal year ended December 31, [removed: 2015][added: 2016]

| [removed: ¨] [added: ☐] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |

[removed: þ] [added: ☑] Yes [removed: ¨] [added: ☐] No

[removed: ¨] [added: ☐] Yes [removed: þ] [added: ☑] No

[removed: þ] [added: ☑] Yes [removed: ¨] [added: ☐] No

[removed: þ] [added: ☑] Yes [removed: ¨] [added: ☐] No

| [removed: þ] [added: ☑] Large accelerated filer | | [removed: o] [added: ☐] Accelerated filer | | [removed: o] [added: ☐] Non-accelerated filer | | [removed: o] [added: ☐] Smaller reporting company |

[removed: ¨] [added: ☐] Yes [removed: þ] [added: ☑] No

As of June 30, [removed: 2015,] [added: 2016,] 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 [removed: $11,382,668,479] [added: $12,787,681,387] based on the closing price reported on the NASDAQ Global Select Market on such date.

As of February [removed: 19, 2016,] [added: 17, 2017,] there were [removed: 168,034,463] [added: 166,341,316] shares outstanding of the registrant's Common Stock, par value $.001.

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 [removed: 2016] [added: 2017] Annual Meeting of Stockholders, which will be filed with the Securities and Exchange Commission not later than 120 days after December 31, [removed: 2015.][added: 2016.]

| | Item 1. | [removed: [Business](#sA699B69DB614579E8D3EB6974E971875)] [added: [Business](#s2E33787F58A15C0EA45407F88B2732E6)] | [removed: [4](#sA699B69DB614579E8D3EB6974E971875)] [added: [4](#s2E33787F58A15C0EA45407F88B2732E6)] |

| | Item 1A. | [Risk [removed: Factors](#sA580EB1E9256526C809311023B4C2884)] [added: Factors](#sDD2578BF70445B4290C6E7E4F4E3CB32)] | [removed: [15](#sA580EB1E9256526C809311023B4C2884)] [added: [15](#sDD2578BF70445B4290C6E7E4F4E3CB32)] |

| | Item 1B. | [Unresolved Staff [removed: Comments](#s18EF0F4301F45326B4810C582CFF05D1)] [added: Comments](#s6E33CC6EE2BD542087E515AE1466D361)] | [removed: [22](#s18EF0F4301F45326B4810C582CFF05D1)] [added: [22](#s6E33CC6EE2BD542087E515AE1466D361)] |

| | Item 2. | [removed: [Properties](#s15DFC088B4415F18AF5A60F514792DCA)] [added: [Properties](#sBEEA258077B452C19FDCEF9309F36660)] | [removed: [22](#s15DFC088B4415F18AF5A60F514792DCA)] [added: [22](#sBEEA258077B452C19FDCEF9309F36660)] |

| | Item 3. | [Legal [removed: Proceedings](#sFA6E437657195DEE88A9CB12985BBFF1)] [added: Proceedings](#s8E261597DA1157C0B593E430B0DEA8C0)] | [removed: [22](#sFA6E437657195DEE88A9CB12985BBFF1)] [added: [23](#s8E261597DA1157C0B593E430B0DEA8C0)] |

| | Item 4. | [Mine Safety [removed: Disclosures](#sB417D84AAB4D5DB39B7C69DEA13A64C7)] [added: Disclosures](#s346CA0EBD5FD5130B259128EFEA328BD)] | [removed: [24](#sB417D84AAB4D5DB39B7C69DEA13A64C7)] [added: [25](#s346CA0EBD5FD5130B259128EFEA328BD)] |

| | Item 5. | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#sA6F7070CCC965735A8A3D6E64148C030)] [added: Securities](#s6D51DC6E97865326B23E7EC31B7EA0D1)] | [removed: [24](#sA6F7070CCC965735A8A3D6E64148C030)] [added: [26](#s6D51DC6E97865326B23E7EC31B7EA0D1)] |

| | Item 6. | [Selected Financial [removed: Data](#s3A2E51D646BE5FEE90D5BCD509FDE59A)] [added: Data](#s7A7D67CBC90B5A2F88818EBD9098D15A)] | [removed: [26](#s3A2E51D646BE5FEE90D5BCD509FDE59A)] [added: [27](#s7A7D67CBC90B5A2F88818EBD9098D15A)] |

| | Item 7. | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#sFB0A7671F0025EBAB08DFFD5415268F3)] [added: Operations](#s4D7BF88F074E59C7B5C48D7D9180950B)] | [removed: [29](#sFB0A7671F0025EBAB08DFFD5415268F3)] [added: [31](#s4D7BF88F074E59C7B5C48D7D9180950B)] |

| | Item 7A. | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#s5B32A793C718596AA269BAA3BDA95FBB)] [added: Risk](#sA1B95632100B5A11B8881F1A0B11FBA0)] | [removed: [46](#s5B32A793C718596AA269BAA3BDA95FBB)] [added: [49](#sA1B95632100B5A11B8881F1A0B11FBA0)] |

| | Item 8. | [Financial Statements and Supplementary [removed: Data](#sE1EC849CF4365C45AB49F0035883264D)] [added: Data](#s05095ECE752153829AAC9B9049323B9F)] | [removed: [46](#sE1EC849CF4365C45AB49F0035883264D)] [added: [49](#s05095ECE752153829AAC9B9049323B9F)] |

| | | [Consolidated Balance [removed: Sheets](#s62C6C20D4FBC5448857E7374F0A59D55)] [added: Sheets](#s14CA2B28B08B5F09B423769BCD7E066B)] | [removed: [53](#s62C6C20D4FBC5448857E7374F0A59D55)] [added: [57](#s14CA2B28B08B5F09B423769BCD7E066B)] |

| | | [Consolidated Statements of [removed: Operations](#s114AE12A8E2459918F57C4A24FC187C5)] [added: Operations](#s1294B9CB8552503CBD3ED584BB2AD56B)] | [removed: [54](#s114AE12A8E2459918F57C4A24FC187C5)] [added: [58](#s1294B9CB8552503CBD3ED584BB2AD56B)] |

| | | [Consolidated Statements of Comprehensive [removed: Income](#s5F417FD5CD15597F9F87558542DD7CDE)] [added: Income](#sB091D03A253B505E8732600AE8264C0A)] | [removed: [55](#s5F417FD5CD15597F9F87558542DD7CDE)] [added: [59](#sB091D03A253B505E8732600AE8264C0A)] |

| | | [Consolidated Statements of Changes in Shareholders’ [removed: Equity](#s0C7C8D43CCA1567CAE52DFBE7D1A32FC)] [added: Equity](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] | [removed: [56](#s0C7C8D43CCA1567CAE52DFBE7D1A32FC)] [added: [60](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] |

| | | [Consolidated Statements of Cash [removed: Flows](#sA0412F272D9456D0AD303561ADB338D5)] [added: Flows](#sB0843B13B3A557E6ABCF42393826BE6E)] | [removed: [57](#sA0412F272D9456D0AD303561ADB338D5)] [added: [61](#sB0843B13B3A557E6ABCF42393826BE6E)] |

| | | [Notes to Consolidated Financial [removed: Statements](#s698EC5C0F6C55B5FA0D97677A42AEEBF)] [added: Statements](#sC354D685384E5466AE4E8FCCD0E3FC05)] | [removed: [59](#s698EC5C0F6C55B5FA0D97677A42AEEBF)] [added: [63](#sC354D685384E5466AE4E8FCCD0E3FC05)] |

| | Item 9. | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#s715972564D005D1BB5E5B07F22800741)] [added: Disclosure](#s56F38CAA8774589896678FF5DDF86E0B)] | [removed: [46](#s715972564D005D1BB5E5B07F22800741)] [added: [49](#s56F38CAA8774589896678FF5DDF86E0B)] |

| | Item 9A. | [Controls and [removed: Procedures](#sFE53F797AF5B5046AB861E81C72B9AC4)] [added: Procedures](#sB64E56C7E467568BB567A1C6E99E7DD0)] | [removed: [46](#sFE53F797AF5B5046AB861E81C72B9AC4)] [added: [49](#sB64E56C7E467568BB567A1C6E99E7DD0)] |

| | Item 9B. | [Other [removed: Information](#s0E64E78F622B5FB5AE40E6D0FDDCF16C)] [added: Information](#s0DA38679DDD05CF69EBE6A8C718B842D)] | [removed: [47](#s0E64E78F622B5FB5AE40E6D0FDDCF16C)] [added: [50](#s0DA38679DDD05CF69EBE6A8C718B842D)] |

| | Item 10. | [Directors, Executive Officers and Corporate [removed: Governance](#s9560B25A46835310B7D73B9A10B455A6)] [added: Governance](#s67B8C91C6C315604A035E1966C22C0BA)] | [removed: [47](#s9560B25A46835310B7D73B9A10B455A6)] [added: [51](#s67B8C91C6C315604A035E1966C22C0BA)] |

| | Item 11. | [Executive [removed: Compensation](#sB1EF73C768455B9DBA6A98689C33B122)] [added: Compensation](#s7991128CBA2056A09D3C898E12686942)] | [removed: [47](#sB1EF73C768455B9DBA6A98689C33B122)] [added: [51](#s7991128CBA2056A09D3C898E12686942)] |

| | Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#s53AF58D52E8E561FAF1B9C8D8BBAF44A)] [added: Matters](#s714B9919543858A1912DC64761557FE9)] | [removed: [47](#s53AF58D52E8E561FAF1B9C8D8BBAF44A)] [added: [51](#s714B9919543858A1912DC64761557FE9)] |

| | Item 13. | [Certain Relationships and Related Transactions and Director [removed: Independence](#sCEE9DC8B294553E5A54B6434E386E21D)] [added: Independence](#s5FAB3F287D2E5D009D01CA5B55B148A9)] | [removed: [47](#sCEE9DC8B294553E5A54B6434E386E21D)] [added: [51](#s5FAB3F287D2E5D009D01CA5B55B148A9)] |

| | Item 14. | [Principal Accounting Fees and [removed: Services](#s14BED3CAE2225007A47DE399F610D150)] [added: Services](#sA1524CDA63785DD885CA9EEA9E905581)] | [removed: [47](#s14BED3CAE2225007A47DE399F610D150)] [added: [51](#sA1524CDA63785DD885CA9EEA9E905581)] |

| | Item 15. | [Exhibits and Financial Statement [removed: Schedules](#s28D334A969C7523C965064906C2F2B97)] [added: Schedules](#s9318E0A92871518097D1FD2F6211EC90)] | [removed: [48](#s28D334A969C7523C965064906C2F2B97)] [added: [52](#s9318E0A92871518097D1FD2F6211EC90)] |

In this annual report on Form 10-K, all dollar amounts are expressed in [removed: thousands,] [added: millions,] unless indicated otherwise.

10-K 1 vrsk10k12312016.htm 10-K

| | Item 16. | [Form 10-K Summary](#s6bb30174d1204b0497b69b17cfea43e9) | [52](#s6bb30174d1204b0497b69b17cfea43e9) |

| | | | |

| | | [SIGNATURES](#s04DDA7C7B85F54B38322231BD7DB8E40) | [103](#s04DDA7C7B85F54B38322231BD7DB8E40) |

| | | [EXHIBIT INDEX](#sFD0D65189B04578A9D70CB40EA446B84) | [104](#sFD0D65189B04578A9D70CB40EA446B84) |

| | | Exhibit 10.16 | |

| | | Exhibit 10.17 | |

10-K 1 vrsk10k12312015.htm 10-K

| | | [SIGNATURES](#s27E8382838915B3F9432A581A4E8783A) | [99](#s27E8382838915B3F9432A581A4E8783A) |

| | | [EXHIBIT INDEX](#s423F4B84D8815F43BD09ED9F82EBE836) | [100](#s423F4B84D8815F43BD09ED9F82EBE836) |

As of December 31, [removed: 2015,] [added: 2016,] our principal offices consisted of the following properties:

We also lease offices in 16 states in the [removed: United States,] [added: U.S.,] and offices outside the [removed: United States] [added: U.S.] to support our international operations in Argentina, Australia, Bahrain, Brazil, Canada, China, Denmark, Germany, India, Indonesia, [added: Ireland,] Israel, Japan, Kazakhstan, Malaysia, [added: Mexico,] Nepal, Nigeria, Russia, Singapore, South Africa, South Korea, Spain, [added: Thailand, the] United Arab Emirates and the [removed: United Kingdom.][added: U.K.]

| White Plains, New York | 63,461 | | September 29, 2021 |

| Houston, Texas | 56,584 | | April 30, 2023 |

| South Jordan, Utah | 105,605 | | August 31, 2025 |

| Draper, Utah | 66,880 | | November 30, 2022 |

As of February [removed: 19, 2016,] [added: 17, 2017,] the closing price of our common stock was [removed: $67.95] [added: $84.90] per share, as reported by the NASDAQ Global Select Market.

As of February [removed: 19, 2016,] [added: 17, 2017,] there were approximately [removed: 38] [added: 40] stockholders of record.

We believe the number of beneficial owners is substantially greater than the number of record [removed: holders for,] [added: holders,] because a large portion of common stock is held in “street name” by brokers.

We [removed: do] have a publicly announced share repurchase plan and [removed: have] repurchased [removed: 46,310,780] [added: a total of 50,636,328] shares since our [removed: IPO.][added: IPO through December 31, 2016.]

The following table shows the quarterly range of the closing high and low per share [removed: sales] [added: trading] prices for our common stock as reported by the NASDAQ Global Select Market for the years ending December 31:

| | | High | | | [added: |] Low | | | [added: |] High | | | [added: |] Low | | [added: |]

| Fourth Quarter | [added: |] $ | [removed: 81.50] [added: 84.15] | | [added: |] $ | [removed: 69.03] [added: 79.36] | | [added: |] $ | [removed: 65.15] [added: 81.50] | | [added: |] $ | [removed: 59.07] [added: 69.03] | |

| Third Quarter | [added: |] $ | [removed: 78.60] [added: 85.75] | | [added: |] $ | [removed: 70.77] [added: 79.43] | | [added: |] $ | [removed: 64.77] [added: 78.60] | | [added: |] $ | [removed: 59.42] [added: 70.77] | |

| Second Quarter | [added: |] $ | [removed: 76.85] [added: 81.08] | | [added: |] $ | [removed: 71.53] [added: 76.00] | | [added: |] $ | [removed: 61.79] [added: 76.85] | | [added: |] $ | [removed: 56.55] [added: 71.53] | |

| First Quarter | [added: |] $ | [removed: 72.27] [added: 79.92] | | [added: |] $ | [removed: 62.70] [added: 65.95] | | [added: |] $ | [removed: 66.05] [added: 72.27] | | [added: |] $ | [removed: 59.87] [added: 62.70] | |

The graph below compares the cumulative total stockholder return on $100 invested in our common stock, with the cumulative total return (assuming reinvestment of dividends) on $100 invested in [removed: each of] the [removed: NASDAQ Composite Index,] S&P 500 [removed: Index, an aggregate of peer issuers in the information industry used in last year’s statement,] [added: Index] and [removed: a new group of] [added: an] aggregate of peer issuers in the information industry.

The [removed: prior] peer issuers used for this graph are [removed: Dun & Bradstreet Corporation,] Equifax Inc., Factset Research Systems Inc., [removed: Fair Isaac Corporation,] IHS [removed: Inc, Morningstar, Inc., MSCI Inc., and Solera Holdings, Inc. The new peer issuers used for this graph are Equifax Inc., Factset Research Systems Inc., IHS Inc,] [added: Markit,] MSCI Inc., Moody’s Corporation, [removed: McGraw Hill Financial, Inc.,] [added: S&P Global, and] Nielsen Holdings [removed: plc, and Solera Holdings, Inc. Each peer issuer was weighted according to its respective market capitalization on December 31, 2010.][added: plc.]

Assumes $100 Invested on December 31, [removed: 2010][added: 2011]

Fiscal Year Ended December 31, [removed: 2015][added: 2016]

[removed: \-][added: ]

There were no unregistered sales of equity securities by the Company during [removed: 2015.][added: 2016.]

Our board of directors has authorized a share repurchase program, or Repurchase Program, [added: since May 2010,] up to [removed: $2.3] [added: $2.8] billion, including an additional authorization of [removed: $300.0] [added: $500.0] million announced on December [removed: 1, 2015.][added: 8, 2016.]

As of December 31, [removed: 2015, $469.4] [added: 2016, $636.0] million remains available for share repurchases.

Our shares repurchased for the quarter ended December 31, [removed: 2015] [added: 2016] are set forth below:

As of December 31, 2016, we had 377,087,266 shares of treasury stock.

| | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | | | | | |

| | | 2016 | | | | | | | | 2015 | | | | | | |

Each peer issuer was weighted according to its respective market capitalization on December 31, 2011.

| | | | | | | | | | | | | (in millions) | |

| October 1, 2016 through October 31, 2016 | 964,938 | | | $ | 80.53 | | | 964,938 | | | $ | 201.8 | |

| November 1, 2016 through November 30, 2016 | 431,960 | | | $ | 82.51 | | | 431,960 | | | $ | 166.2 | |

| December 1, 2016 through December 31, 2016 | 366,836 | | | $ | 82.26 | | | 366,836 | | | $ | 636.0 | |

| | 1,763,734 | | | | | | | 1,763,734 | | | | | |

As of December 31, 2015, we had 374,578,057 shares of treasury stock.

| | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | | | | | | | | | | | | |

| | | 2015 | | | | | | 2014 | | | | |

The Company has selected a new peer group to include a broader selection of peer companies because of acquisitions and dispositions within Company’s lines of business.

In this transition year, the table and the graph below include both the prior and new indices of peer companies.

| | | | | | | | | | | | | (in thousands) | |

| October 1, 2015 through October 31, 2015 | — | | | $ | — | | | — | | | $ | 189,807 | |

| November 1, 2015 through November 30, 2015 | 248,153 | | | $ | 73.10 | | | 248,153 | | | $ | 171,667 | |

| December 1, 2015 through December 31, 2015 | 31,300 | | | $ | 73.98 | | | 31,300 | | | $ | 469,351 | |

| | 279,453 | | | | | | | 279,453 | | | | | |

In connection with the accelerated share repurchase program, or ASR program, upon payment of the aggregate purchase price in December 2014, we received an initial delivery of 6,372,472 shares of common stock.

Upon final settlement of the ASR agreement in June 2015, we received an additional 809,021 shares of common stock.

The consolidated statement of operations data for the years ended December 31, [removed: 2015, 2014] [added: 2016, 2015] and [removed: 2013] [added: 2014] and the consolidated balance sheet data as of December 31, [removed: 2015] [added: 2016] and [removed: 2014] [added: 2015] are derived from the audited consolidated financial statements included elsewhere in this annual report on Form 10-K.

The consolidated statement of operations data for the years ended December 31, [removed: 2012] [added: 2013] and [removed: 2011] [added: 2012] and the consolidated balance sheet data as of December 31, [removed: 2013, 2012] [added: 2014, 2013] and [removed: 2011] [added: 2012] are derived from consolidated financial statements that are not included in this annual report on Form 10-K.

Results for the year ended December 31, [removed: 2015] [added: 2016] are not necessarily indicative of results that may be expected in any other future period.

Between January 1, [removed: 2011] [added: 2012] and December 31, [removed: 2015,] [added: 2016,] we acquired [removed: 12] [added: 15] businesses (most notably Wood Mackenzie on May 19, 2015), which may affect the comparability of our consolidated financial statements.

Our consolidated financial statements have been retroactively adjusted in all periods presented to give recognition to the discontinued operations of our [added: heathcare business and] mortgage services business.

| | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | |

| | (In [removed: thousands,] [added: millions,] except for share and per share data) | | | | | | | | | | | | | | | | | | |

| Gain on derivative instruments | | [removed: 85,187] [added: —] | | | | [removed: —] [added: 85.2] | | | | — | | | | — | | | | — | |

| Income from discontinued operations, net of tax [removed: (2)] [added: (1)] | | [removed: —] [added: 139.7] | | | | [removed: 29,177] [added: 20.1] | | | | [removed: 6,066] [added: 46.0] | | | | [removed: 11,679] [added: 29.5] | | | | [removed: 20,302] [added: 40.4] | |

| Income from discontinued operations | | [removed: —] [added: 0.83] | | | | [removed: 0.17] [added: 0.12] | | | | [removed: 0.03] [added: 0.27] | | | | [removed: 0.07] [added: 0.17] | | | | [removed: 0.12] [added: 0.24] | |

| Basic net income per share | $ | [removed: 3.07] [added: 3.51] | | | $ | [removed: 2.41] [added: 3.07] | | | $ | [removed: 2.07] [added: 2.41] | | | $ | [removed: 1.98] [added: 2.07] | | | $ | [removed: 1.70] [added: 1.98] | |

| Income from discontinued operations | | [removed: —] [added: 0.81] | | | | [removed: 0.17] [added: 0.12] | | | | [removed: 0.03] [added: 0.27] | | | | [removed: 0.07] [added: 0.17] | | | | [removed: 0.12] [added: 0.24] | |

| Diluted net income per share | $ | [removed: 3.01] [added: 3.45] | | | $ | [removed: 2.37] [added: 3.01] | | | $ | [removed: 2.02] [added: 2.37] | | | $ | [removed: 1.92] [added: 2.02] | | | $ | [removed: 1.63] [added: 1.92] | |

| Basic | | [removed: 165,090,380] [added: 168,248,304] | | | | [removed: 165,823,803] [added: 165,090,380] | | | | [removed: 168,031,412] [added: 165,823,803] | | | | [removed: 165,890,258] [added: 168,031,412] | | | | [removed: 166,015,238] [added: 165,890,258] | |

| Diluted | | [removed: 168,451,343] [added: 171,171,572] | | | | [removed: 169,132,423] [added: 168,451,343] | | | | [removed: 172,276,360] [added: 169,132,423] | | | | [removed: 171,709,518] [added: 172,276,360] | | | | [removed: 173,325,110] [added: 171,709,518] | |

| | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | |

| EBITDA [removed: (3):] [added: (2):] | | | | | | | | | | | | | | | | | | | |

| Depreciation and amortization of fixed and intangible assets from continuing operations | | [removed: 215,484] [added: 211.6] | | | | [removed: 142,376] [added: 167.0] | | | | [removed: 129,931] [added: 95.5] | | | | [removed: 98,844] [added: 85.4] | | | | [removed: 73,120] [added: 65.8] | |

| Depreciation, amortization, interest and provision for income taxes from discontinued operations | | [removed: —] [added: 126.3] | | | | [removed: 26,411] [added: 61.6] | | | | [removed: 9,400] [added: 84.6] | | | | [removed: 13,058] [added: 65.6] | | | | [removed: 17,423] [added: 65.8] | |

| | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | | | [removed: 2011] [added: 2012] | | |

| [removed: (2)] [added: (1)] | On [added: June 1, 2016 and] March 11, 2014, we sold our [added: healthcare business and] mortgage services [removed: business.] [added: business, respectively.] Results of operations for the [added: healthcare and] mortgage services [removed: business] [added: businesses] are reported as [removed: a] discontinued [removed: operation] [added: operations] for the year ended December 31, [removed: 2014] [added: 2016] and for all prior periods presented. As necessary, the amounts have been retroactively adjusted in all periods presented to give recognition to the discontinued operations. See Note 10 of our consolidated financial statements included in this annual report on Form 10-K. |

| [removed: (3)] [added: (2)] | EBITDA is the financial measure [removed: which] [added: that] management uses to evaluate the performance of our segments. “EBITDA” is defined as net income before interest expense, provision for income taxes, [added: and] depreciation and amortization of fixed and intangible assets. Because EBITDA is calculated from net income, this presentation includes EBITDA from discontinued operations of our [added: healthcare business and] mortgage services business. In addition, [removed: this Management’s Discussion and Analysis includes] references to EBITDA margin, which is computed as EBITDA divided by revenues from continuing and discontinued operations. See Note 18 of our consolidated financial statements included in this annual report on Form 10-K. |

| • | EBITDA does not reflect our cash expenditures, or future requirements for capital expenditures or contractual [removed: commitments;] [added: commitments.] |

| ▪ | EBITDA does not reflect changes in, or cash requirements for, our working capital [removed: needs;] [added: 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 [removed: replacements; and] [added: replacements.] |

| [removed: (4)] [added: (3)] | Includes capital lease obligations. |

| [removed: (5)] [added: (4)] | Subsequent to our corporate reorganization on October 6, 2009, share repurchases are recorded as treasury stock within stockholders’ [removed: equity (deficit),] [added: equity,] as we intend to reissue shares from treasury stock in the future. For the years ended December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] we repurchased [removed: $120.5] [added: $333.3] million and [removed: $675.4] [added: $120.5] million, respectively, of treasury stock. |

| Decision Analytics | $ | 1,270.9 | | | $ | 1,072.5 | | | $ | 780.5 | | | $ | 705.9 | | | $ | 605.4 | |

| Risk Assessment | | 724.3 | | | | 688.2 | | | | 650.6 | | | | 618.3 | | | | 579.5 | |

| Revenues | | 1,995.2 | | | | 1,760.7 | | | | 1,431.1 | | | | 1,324.2 | | | | 1,184.9 | |

| Cost of revenues (exclusive of items shown separately below) | | 714.4 | | | | 612.0 | | | | 516.0 | | | | 472.5 | | | | 411.5 | |

| Selling, general and administrative | | 301.6 | | | | 278.3 | | | | 187.3 | | | | 186.8 | | | | 183.8 | |

| Depreciation and amortization of fixed assets | | 119.1 | | | | 96.6 | | | | 65.4 | | | | 49.2 | | | | 36.7 | |

| Amortization of intangible assets | | 92.5 | | | | 70.4 | | | | 30.1 | | | | 36.2 | | | | 29.1 | |

| Total expenses | | 1,227.6 | | | | 1,057.3 | | | | 798.8 | | | | 744.7 | | | | 661.1 | |

| Operating income | | 767.6 | | | | 703.4 | | | | 632.3 | | | | 579.5 | | | | 523.8 | |

| Investment income and others, net | | 6.1 | | | | 16.9 | | | | 0.2 | | | | 0.3 | | | | 0.1 | |

| Interest expense | | (120.0 | ) | | | (121.4 | ) | | | (70.0 | ) | | | (76.1 | ) | | | (72.5 | ) |

| Total other expense, net | | (113.9 | ) | | | (19.3 | ) | | | (69.8 | ) | | | (75.8 | ) | | | (72.4 | ) |

| Income before income taxes from continuing operations | | 653.7 | | | | 684.1 | | | | 562.5 | | | | 503.7 | | | | 451.4 | |

| Provision for income taxes | | (202.2 | ) | | | (196.6 | ) | | | (208.5 | ) | | | (184.8 | ) | | | (162.7 | ) |

| Income from continuing operations | | 451.5 | | | | 487.5 | | | | 354.0 | | | | 318.9 | | | | 288.7 | |

| Net income | $ | 591.2 | | | $ | 507.6 | | | $ | 400.0 | | | $ | 348.4 | | | $ | 329.1 | |

| Income from continuing operations | $ | 2.68 | | | $ | 2.95 | | | $ | 2.14 | | | $ | 1.90 | | | $ | 1.74 | |

| Income from continuing operations | $ | 2.64 | | | $ | 2.89 | | | $ | 2.10 | | | $ | 1.85 | | | $ | 1.68 | |

| | (In millions) | | | | | | | | | | | | | | | | | | |

| Decision Analytics EBITDA | $ | 835.8 | | | $ | 647.7 | | | $ | 489.8 | | | $ | 413.4 | | | $ | 379.6 | |

| Risk Assessment EBITDA | | 415.5 | | | | 406.5 | | | | 368.8 | | | | 346.9 | | | | 316.3 | |

| EBITDA | $ | 1,251.3 | | | $ | 1,054.2 | | | $ | 858.6 | | | $ | 760.3 | | | $ | 695.9 | |

| Net income | $ | 591.2 | | | $ | 507.6 | | | $ | 400.0 | | | $ | 348.4 | | | $ | 329.1 | |

| Interest expense from continuing operations | | 120.0 | | | | 121.4 | | | | 70.0 | | | | 76.1 | | | | 72.5 | |

| Provision for income taxes from continuing operations | | 202.2 | | | | 196.6 | | | | 208.5 | | | | 184.8 | | | | 162.7 | |

| EBITDA | $ | 1,251.3 | | | $ | 1,054.2 | | | $ | 858.6 | | | $ | 760.3 | | | $ | 695.9 | |

| | (In millions) | | | | | | | | | | | | | | | | | | |

| Cash and cash equivalents | $ | 135.1 | | | $ | 138.3 | | | $ | 39.3 | | | $ | 165.8 | | | $ | 89.8 | |

| Total assets | $ | 4,631.2 | | | $ | 5,593.7 | | | $ | 2,335.1 | | | $ | 2,492.8 | | | $ | 2,347.3 | |

| Total debt (3) | $ | 2,387.0 | | | $ | 3,145.7 | | | $ | 1,426.7 | | | $ | 1,264.2 | | | $ | 1,448.4 | |

| Stockholders’ equity (4) | $ | 1,332.4 | | | $ | 1,372.0 | | | $ | 211.0 | | | $ | 547.6 | | | $ | 255.6 | |

| Decision Analytics | $ | 1,379,819 | | | $ | 1,096,074 | | | $ | 977,427 | | | $ | 828,342 | | | $ | 639,100 | |

| Risk Assessment | | 688,191 | | | | 650,652 | | | | 618,276 | | | | 579,506 | | | | 552,293 | |

| Revenues | | 2,068,010 | | | | 1,746,726 | | | | 1,595,703 | | | | 1,407,848 | | | | 1,191,393 | |

| Cost of revenues | | 803,274 | | | | 716,598 | | | | 622,523 | | | | 516,708 | | | | 440,979 | |

| Selling, general and administrative | | 312,690 | | | | 227,306 | | | | 228,982 | | | | 220,068 | | | | 199,495 | |

| Depreciation and amortization of fixed assets | | 120,620 | | | | 85,506 | | | | 66,190 | | | | 46,637 | | | | 40,135 | |

| Amortization of intangible assets | | 94,864 | | | | 56,870 | | | | 63,741 | | | | 52,207 | | | | 32,985 | |

| Acquisition related liabilities adjustment (1) | | — | | | | — | | | | — | | | | — | | | | (3,364 | ) |

| Total expenses | | 1,331,448 | | | | 1,086,280 | | | | 981,436 | | | | 835,620 | | | | 710,230 | |

| Operating income | | 736,562 | | | | 660,446 | | | | 614,267 | | | | 572,228 | | | | 481,163 | |

| Investment income and others, net | | 17,003 | | | | 158 | | | | 609 | | | | 106 | | | | 879 | |

| Interest expense | | (121,316 | ) | | | (69,984 | ) | | | (76,136 | ) | | | (72,508 | ) | | | (53,847 | ) |

| Total other expense, net | | (19,126 | ) | | | (69,826 | ) | | | (75,527 | ) | | | (72,402 | ) | | | (52,968 | ) |

| Income before income taxes from continuing operations | | 717,436 | | | | 590,620 | | | | 538,740 | | | | 499,826 | | | | 428,195 | |

| Provision for income taxes | | (209,859 | ) | | | (219,755 | ) | | | (196,426 | ) | | | (182,363 | ) | | | (165,739 | ) |

| Income from continuing operations | | 507,577 | | | | 370,865 | | | | 342,314 | | | | 317,463 | | | | 262,456 | |

| Net income | $ | 507,577 | | | $ | 400,042 | | | $ | 348,380 | | | $ | 329,142 | | | $ | 282,758 | |

| Income from continuing operations | $ | 3.07 | | | $ | 2.24 | | | $ | 2.04 | | | $ | 1.91 | | | $ | 1.58 | |

| Income from continuing operations | $ | 3.01 | | | $ | 2.20 | | | $ | 1.99 | | | $ | 1.85 | | | $ | 1.51 | |

| | (In thousands) | | | | | | | | | | | | | | | | | | |

| Decision Analytics EBITDA | $ | 647,738 | | | $ | 489,798 | | | $ | 413,342 | | | $ | 379,655 | | | $ | 305,837 | |

| Risk Assessment EBITDA | | 406,498 | | | | 368,770 | | | | 346,931 | | | | 316,260 | | | | 287,050 | |

| EBITDA | $ | 1,054,236 | | | $ | 858,568 | | | $ | 760,273 | | | $ | 695,915 | | | $ | 592,887 | |

| Net income | $ | 507,577 | | | $ | 400,042 | | | $ | 348,380 | | | $ | 329,142 | | | $ | 282,758 | |

| Interest expense from continuing operations | | 121,316 | | | | 69,984 | | | | 76,136 | | | | 72,508 | | | | 53,847 | |

| Provision for income taxes from continuing operations | | 209,859 | | | | 219,755 | | | | 196,426 | | | | 182,363 | | | | 165,739 | |

| EBITDA | $ | 1,054,236 | | | $ | 858,568 | | | $ | 760,273 | | | $ | 695,915 | | | $ | 592,887 | |

| | (In thousands) | | | | | | | | | | | | | | | | | | |

| Cash and cash equivalents | $ | 138,348 | | | $ | 39,359 | | | $ | 165,801 | | | $ | 89,819 | | | $ | 191,603 | |

| Total assets | $ | 5,615,927 | | | $ | 2,345,330 | | | $ | 2,504,451 | | | $ | 2,360,336 | | | $ | 1,541,106 | |

| Total debt (4) | $ | 3,167,990 | | | $ | 1,436,932 | | | $ | 1,275,887 | | | $ | 1,461,425 | | | $ | 1,105,886 | |

| Stockholders’ equity (deficit) (5) | $ | 1,372,011 | | | $ | 211,043 | | | $ | 547,589 | | | $ | 255,591 | | | $ | (98,490 | ) |

| | |

| --- | --- |

| (1) | During the second quarter of 2011, we reevaluated the probability of D2Hawkeye and Strategic Analytics achieving the specified predetermined EBITDA and revenue targets for exceptional performance in fiscal year 2011 and reversed the contingent consideration related to these acquisitions. |

Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s 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 the Company and our subsidiaries other than [removed: Wood Mackenzie and its subsidiaries] [added: Greentech Media, Inc.,] which [removed: we] [added: was] acquired on [removed: May 19, 2015, Infield] [added: July 26, 2016, Analyze Re, Inc.,] which [removed: we] [added: was] acquired on [removed: November 6, 2015] [added: October 20, 2016,] and [removed: PCI] [added: the GeoInformation Group Limited,] which [removed: we] [added: was] acquired on November [removed: 20, 2015.][added: 11,2016.]

Management excluded from its assessment the internal control over financial reporting [removed: at Wood Mackenzie and subsidiaries, Infield, and PCI] [added: of these acquisitions] and collectively [removed: represented] [added: represents] approximately [removed: 4.9%] [added: 0.2%] of total [removed: assets,] [added: assets] and [removed: 10.2%] [added: 0.3%] of revenues as of and for the year ended December 31, [removed: 2015.][added: 2016.]

Based upon the foregoing assessments, our Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, [removed: 2015,] [added: 2016,] our disclosure controls and procedures were effective at the reasonable assurance level.

Management’s Report on Internal Control Over Financial Reporting as of December 31, [removed: 2015] [added: 2016] is set forth in Item 8.

The Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting as of December 31, [removed: 2015] [added: 2016] is set forth in Item 8.

We are in the process of integrating [removed: Wood Mackenzie and its subsidiaries, Infield] [added: Greentech Media, Analyze Re] and [removed: PCI] [added: GeoInformation] (which we acquired in [removed: May 2015] [added: July 2016, October 2016] and November [removed: 2015,] [added: 2016,] respectively) 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 [removed: 2015] [added: 2016] that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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, [removed: 2015] [added: 2016] (the “Proxy Statement”).

| | |

| --- | --- |

| | |

None.

| Verisk Analytics, Inc. Consolidated Financial Statements as of December 31, [removed: 2015] [added: 2016] and [removed: 2014] [added: 2015] and for the Years Ended December 31, [removed: 2015, 2014] [added: 2016, 2015] and [removed: 2013.] [added: 2014.] | |

| [Management’s Report on Internal Controls Over Financial [removed: Reporting](#s6D811928990C5CDD8F7FE75A482149BB)] [added: Reporting](#s076B24A05F4F55DE836DA6DA30DBE2D9)] | [removed: [50](#s6D811928990C5CDD8F7FE75A482149BB)] [added: [54](#s076B24A05F4F55DE836DA6DA30DBE2D9)] |

| [Report of Independent Registered Public Accounting [removed: Firm](#s87EEEE65B69C54F0B23FD804C58100DA)] [added: Firm](#s4463E5C7FF13542FAEB0729B1B04218A)] | [removed: [51](#s87EEEE65B69C54F0B23FD804C58100DA)] [added: [56](#s4463E5C7FF13542FAEB0729B1B04218A)] |

| [Report of Independent Registered Public Accounting Firm on Internal Controls Over Financial [removed: Reporting](#sA54E3041306654A6A9E295B41366CFD4)] [added: Reporting](#sECB51EE996D35D2EA6A3050919836E0D)] | [removed: [52](#sA54E3041306654A6A9E295B41366CFD4)] [added: [55](#sECB51EE996D35D2EA6A3050919836E0D)] |

| [Consolidated Balance [removed: Sheets](#s62C6C20D4FBC5448857E7374F0A59D55)] [added: Sheets](#s14CA2B28B08B5F09B423769BCD7E066B)] | [removed: [53](#s62C6C20D4FBC5448857E7374F0A59D55)] [added: [57](#s14CA2B28B08B5F09B423769BCD7E066B)] |

| [Consolidated Statements of [removed: Operations](#s114AE12A8E2459918F57C4A24FC187C5)] [added: Operations](#s1294B9CB8552503CBD3ED584BB2AD56B)] | [removed: [54](#s114AE12A8E2459918F57C4A24FC187C5)] [added: [58](#s1294B9CB8552503CBD3ED584BB2AD56B)] |

| [Consolidated Statements of Comprehensive [removed: Income](#s5F417FD5CD15597F9F87558542DD7CDE)] [added: Income](#sB091D03A253B505E8732600AE8264C0A)] | [removed: [55](#s5F417FD5CD15597F9F87558542DD7CDE)] [added: [59](#sB091D03A253B505E8732600AE8264C0A)] |

| [Consolidated Statements of Changes in Stockholders’ [removed: Equity (Deficit)](#s0C7C8D43CCA1567CAE52DFBE7D1A32FC)] [added: Equity](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] | [removed: [56](#s0C7C8D43CCA1567CAE52DFBE7D1A32FC)] [added: [60](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] |

| [Consolidated Statements of Cash [removed: Flows](#sA0412F272D9456D0AD303561ADB338D5)] [added: Flows](#sB0843B13B3A557E6ABCF42393826BE6E)] | [removed: [57](#sA0412F272D9456D0AD303561ADB338D5)] [added: [61](#sB0843B13B3A557E6ABCF42393826BE6E)] |

| [Notes to Consolidated Financial [removed: Statements](#s698EC5C0F6C55B5FA0D97677A42AEEBF)] [added: Statements](#sC354D685384E5466AE4E8FCCD0E3FC05)] | [removed: [59](#s698EC5C0F6C55B5FA0D97677A42AEEBF)] [added: [63](#sC354D685384E5466AE4E8FCCD0E3FC05)] |

| [Schedule II, Valuation and Qualifying Accounts and [removed: Reserves](#sC0A80DED16DC54F499D3F483E5AC3036)] [added: Reserves](#s54D5D5CC7D65570FBFCBAA68F9B78429)] | [removed: [98](#sC0A80DED16DC54F499D3F483E5AC3036)] [added: [102](#s54D5D5CC7D65570FBFCBAA68F9B78429)] |

Based on this assessment, management concluded that our internal control over financial reporting was effective at December 31, [removed: 2015.][added: 2016.]

Management excluded from its assessment the internal control over financial reporting at [removed: Wood Mackenzie Limited ("Wood Mackenzie"),] [added: Greentech Media, Inc.,] which was acquired on [removed: May 19, 2015, Infield Systems Limited ("Infield"),] [added: July 26, 2016, Analyze Re, Inc.,] which was acquired on [removed: November 6, 2015,] [added: October 20, 2016,] and [removed: The PCI] [added: the GeoInformation] Group [removed: ("PCI"),] [added: Limited,] which was acquired on November [removed: 20, 2015.][added: 11, 2016.]

The excluded financial statements of [removed: the] [added: these] acquisitions constitute approximately [removed: 4.9%] [added: 0.2%] of total assets and [removed: 10.2%] [added: 0.3%] of [removed: total] revenues collectively included within our consolidated financial [removed: statement amounts] [added: statements] as of and for the year ended December 31, [removed: 2015.][added: 2016.]

Due to the timing of the acquisitions, management did not assess the [removed: effectiveness] [added: effectivness] of internal control over financial reporting for [removed: Wood Mackenzie, Infield and PCI.][added: 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, [removed: 2015,] [added: 2016,] as stated in their report which is included herein.

We have audited the accompanying consolidated balance sheets of Verisk Analytics, Inc. and subsidiaries (the "Company") as of December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] and the related consolidated statements of operations, comprehensive income, changes in stockholders’ equity, and cash flows for each of the three years in the period ended December 31, [removed: 2015.][added: 2016.]

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Verisk Analytics, Inc. and subsidiaries as of December 31, [removed: 2015] [added: 2016] and [removed: 2014,] [added: 2015,] and the results of their operations and their cash flows for each of the three years in the period ended December 31, [removed: 2015,] [added: 2016,] 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), the Company’s internal control over financial reporting as of December 31, [removed: 2015,] [added: 2016,] based on the criteria established in Internal Control ---- Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 23, 2016] [added: 21, 2017] expressed an unqualified opinion on the Company’s 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, [removed: 2015,] [added: 2016,] based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

As described in Management’s Report on Internal Controls over Financial Reporting, management excluded from its assessment the internal control over financial reporting at [removed: Wood Mackenzie Limited,] [added: Greentech Media, Inc.,] which was acquired on [removed: May 19, 2015, Infield Systems Limited,] [added: July 26, 2016, Analyze Re, Inc.,] which was acquired on [removed: November 6, 2015,] [added: October 20, 2016,] and [removed: The PCI Group,] [added: the GeoInformation Group Limited,] which was acquired on November [removed: 20, 2015.][added: 11,2016.]

The financial statements of these acquisitions constitute [removed: 4.9%] [added: 0.2%] of total assets and [removed: 10.2%] [added: 0.3%] of revenues collectively of the consolidated financial statements of the Company as of and for the year ended December 31, [removed: 2015.][added: 2016.]

Accordingly, our audit did not include the internal control over financial reporting at [removed: WoodMackenzie Limited, Infield Systems Limited] [added: Greentech Media, Inc., Analyze Re, Inc.] or [removed: The PCI Group.][added: the GeoInformation Group Limited.]

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2015,] [added: 2016,] based on the criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement schedule as of and for the year ended December 31, [removed: 2015] [added: 2016] of the Company and our report dated February [removed: 23, 2016] [added: 21, 2017] expressed an unqualified opinion on those financial statements and financial statement schedule.

As of December 31, [removed: 2015] [added: 2016] and [removed: 2014][added: 2015]

| | [added: 2016 | | | |] 2015 | | | | 2014 | | |

| | (In [removed: thousands,] [added: millions,] except for share and per share data) | | | | | | |

| Cash and cash equivalents | $ | [removed: 138,348 | | | $ | 39,359] [added: 2.1] | |

| Available-for-sale securities | | [removed: 3,576] [added: 3.4] | | | | [removed: 3,801] [added: 3.6] | |

| Prepaid expenses | | [removed: 40,741] [added: —] | | | | [removed: 31,496] [added: 6.6] | |

| Deferred income taxes, net | | [removed: — | | | | 4,772] [added: 4.7] | |

| Income taxes receivable | | [removed: 48,853] [added: —] | | | | [removed: 65,512] [added: 0.3] | |

| Other current assets | | [removed: 52,952] [added: 20.3] | | | | [removed: 18,875] [added: 52.9] | |

| Other assets | | [removed: 48,697 | | | | 26,363] [added: 6.8] | |

| Accounts payable and accrued liabilities | $ | [removed: 245,664] [added: —] | | | $ | [removed: 180,726] [added: 23.6] | |

| Short-term debt and current portion of long-term debt | | [removed: 874,811] [added: 106.8] | | | | [removed: 336,058] [added: 874.8] | |

| Pension and postretirement benefits, current | | [removed: 1,831] [added: 0.9] | | | | [removed: 1,894] [added: 1.8] | |

| Deferred income taxes, net | [added: $] | [removed: 396,430] [added: —] | | | [added: $] | [removed: 202,540] [added: 67.3] | |

| Other liabilities | | [removed: 60,098 | | | | 43,388] [added: 8.1] | |

February 21, 2017

February 21, 2017

| | 2016 | | | | 2015 | | |

| Cash and cash equivalents | $ | 135.1 | | | $ | 138.3 | |

| Accounts receivable, net | | 263.9 | | | | 251.0 | |

| Prepaid expenses | | 28.9 | | | | 34.1 | |

| Income taxes receivable | | 49.3 | | | | 48.6 | |

| Current assets held-for-sale | | — | | | | 76.1 | |

| Total current assets | | 500.9 | | | | 604.6 | |

| Fixed assets, net | | 380.3 | | | | 350.3 | |

| Intangible assets, net | | 1,010.8 | | | | 1,245.1 | |

| Goodwill | | 2,578.1 | | | | 2,753.0 | |

| Pension assets | | 19.6 | | | | 32.9 | |

| Deferred income tax assets | | 15.6 | | | | — | |

| Other assets | | 125.9 | | | | 25.9 | |

| Noncurrent assets held-for-sale | | — | | | | 581.9 | |

| Total assets | $ | 4,631.2 | | | $ | 5,593.7 | |

| Deferred revenues | | 330.8 | | | | 340.9 | |

| Current liabilities held-for-sale | | — | | | | 39.7 | |

| Total current liabilities | | 621.6 | | | | 1,479.3 | |

| Long-term debt | | 2,280.2 | | | | 2,270.9 | |

| Pension benefits | | 12.6 | | | | 12.9 | |

| Postretirement benefits | | 1.7 | | | | 2.0 | |

| Deferred income tax liabilities | | 322.2 | | | | 329.2 | |

| Other liabilities | | 60.5 | | | | 58.4 | |

| Noncurrent liabilities held-for-sale | | — | | | | 69.0 | |

| Total liabilities | | 3,298.8 | | | | 4,221.7 | |

| Additional paid-in capital | | 2,121.6 | | | | 2,023.4 | |

| Retained earnings | | 2,752.9 | | | | 2,161.7 | |

| Total stockholders’ equity | | 1,332.4 | | | | 1,372.0 | |

| Revenues | $ | 1,995.2 | | | $ | 1,760.7 | | | $ | 1,431.1 | |

| Selling, general and administrative | | 301.6 | | | | 278.3 | | | | 187.3 | |

| Amortization of intangible assets | | 92.5 | | | | 70.4 | | | | 30.1 | |

| Total expenses | | 1,227.6 | | | | 1,057.3 | | | | 798.8 | |

| Operating income | | 767.6 | | | | 703.4 | | | | 632.3 | |

| Interest expense | | (120.0 | ) | | | (121.4 | ) | | | (70.0 | ) |

| Income before income taxes | | 653.7 | | | | 684.1 | | | | 562.5 | |

| Provision for income taxes | | (202.2 | ) | | | (196.6 | ) | | | (208.5 | ) |

| Income from discontinued operations (Note 10) | | 253.0 | | | | 33.4 | | | | 82.6 | |

| Provision for income taxes from discontinued operations | | (113.3 | ) | | | (13.3 | ) | | | (36.6 | ) |

February 23, 2016

February 23, 2016

| --- | --- | --- | --- | --- | --- | --- | --- |

| Accounts receivable, net | | 320,099 | | | | 220,668 | |

| Total current assets | | 604,569 | | | | 384,483 | |

| Fixed assets, net | | 418,168 | | | | 302,273 | |

| Intangible assets, net | | 1,376,745 | | | | 406,476 | |

| Goodwill | | 3,134,826 | | | | 1,207,146 | |

| Pension assets | | 32,922 | | | | 18,589 | |

| Total assets | $ | 5,615,927 | | | $ | 2,345,330 | |

| Deferred revenues | | 356,951 | | | | 252,592 | |

| Total current liabilities | | 1,479,257 | | | | 771,270 | |

| Long-term debt | | 2,293,179 | | | | 1,100,874 | |

| Pension benefits | | 12,971 | | | | 13,805 | |

| Postretirement benefits | | 1,981 | | | | 2,410 | |

| Total liabilities | | 4,243,916 | | | | 2,134,287 | |

| Unearned KSOP contributions | | — | | | | (161 | ) |

| Additional paid-in capital | | 2,023,390 | | | | 1,171,196 | |

| Retained earnings | | 2,161,726 | | | | 1,654,149 | |

| Total stockholders’ equity | | 1,372,011 | | | | 211,043 | |

| Revenues | $ | 2,068,010 | | | $ | 1,746,726 | | | $ | 1,595,703 | |

| Selling, general and administrative | | 312,690 | | | | 227,306 | | | | 228,982 | |

| Amortization of intangible assets | | 94,864 | | | | 56,870 | | | | 63,741 | |

| Total expenses | | 1,331,448 | | | | 1,086,280 | | | | 981,436 | |

| Operating income | | 736,562 | | | | 660,446 | | | | 614,267 | |

| Interest expense | | (121,316 | ) | | | (69,984 | ) | | | (76,136 | ) |

| Income before income taxes | | 717,436 | | | | 590,620 | | | | 538,740 | |

| Provision for income taxes | | (209,859 | ) | | | (219,755 | ) | | | (196,426 | ) |

| Income from continuing operations | | 507,577 | | | | 370,865 | | | | 342,314 | |

| Income from discontinued operations, net of tax of $0, $25,305 and $4,753, respectively (Note 10) | | — | | | | 29,177 | | | | 6,066 | |

| Net income | $ | 507,577 | | | $ | 400,042 | | | $ | 348,380 | |

| | (In thousands) | | | | | | | | | | |

| Net income | $ | 507,577 | | | $ | 400,042 | | | $ | 348,380 | |

| Total other comprehensive (loss) income | | (161,538 | ) | | | (37,026 | ) | | | 45,672 | |

| Comprehensive income | $ | 346,039 | | | $ | 363,016 | | | $ | 394,052 | |

| Balance, January 1, 2013 | 544,003,038 | | | $ | 137 | | | $ | (483 | ) | | $ | 1,044,746 | | | $ | (1,605,376 | ) | | $ | 905,727 | | | $ | (89,160 | ) | | $ | 255,591 | |

| Treasury stock acquired (4,532,552 shares) | — | | | | — | | | | — | | | | — | | | | (278,938 | ) | | | — | | | | — | | | | (278,938 | ) |

| KSOP shares earned | — | | | | — | | | | 177 | | | | 14,753 | | | | — | | | | — | | | | — | | | | 14,930 | |

| Balance, December 31, 2013 | 544,003,038 | | | | 137 | | | | (306 | ) | | | 1,202,106 | | | | (1,864,967 | ) | | | 1,254,107 | | | | (43,488 | ) | | | 547,589 | |

| KSOP shares earned | — | | | | — | | | | 145 | | | | 15,206 | | | | — | | | | — | | | | — | | | | 15,351 | |