Verisk Analytics (VRSK) 10-K risk factor changes: FY2017 vs FY2016

During the year ended December 31, [removed: 2016,] [added: 2017,] approximately 48.9% of our revenue was derived from solutions provided to U.S. P&C primary insurers.

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

We provide many types of data and services that already are subject to regulation under the Fair Credit Reporting Act, Gramm-Leach-Bliley Act, Driver’s Privacy Protection Act, the European Union’s Data Protection [removed: Directive,] [added: Directive and its successor] the [added: General Data Protection Regulation, the] Dodd Frank Wall Street Reform and Consumer Protection Act and to a lesser extent, various other federal, state, and local laws and regulations.

The Company has implemented various measures to comply with the Data Protection [removed: Directive,] [added: Directive and the forthcoming General Data Protection Regulation,] 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 [removed: Directive,] [added: Directive and the forthcoming General Data Protection Regulation,] 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.

In order to finance acquisitions, which are an important part of our long term growth [removed: strategy ,] [added: strategy,] we may incur substantial additional indebtedness and such increased leverage could adversely affect our business.

[removed: A downturn or perceived downturn in the economy,] particularly the energy industry, could add pricing pressure, delay subscription renewals or lead to more challenging or protracted fee negotiations or generally lower acceptance of our solutions by Wood Mackenzie’s customers, which could cause a decline in our revenues and have a material adverse effect on our financial condition, results of operations and cash flows.

Conducting extensive international operations subjects us to risks that are inherent in international operations, including challenges posed by different pricing environments and different forms of competition; lack of familiarity and burdens of complying with foreign laws, legal standards, regulatory requirements, tariffs and other barriers; unexpected changes in regulatory requirements, taxes, trade laws, tariffs, export quotas, custom duties, or other trade restrictions; differing technology standards; difficulties in collecting accounts receivable; difficulties in managing and staffing international operations; varying expectations as to employee standards; potentially adverse tax consequences, including possible restrictions on the repatriation of earnings; and reduced or [added: varied protection for intellectual property rights in some countries.]

As a result of [removed: the Acquisition,] [added: our acquisition of Wood Mackenzie,] we face greater exposure to movements in currency exchange rates, which may cause our revenue and operating results to differ materially from expectations.

As of December 31, [removed: 2016,] [added: 2017,] our ten largest shareholders owned [removed: 39.6%] [added: 41.0%] of our common stock, including [removed: 5.1%] [added: 4.4%] of our common stock owned by our Employee Stock Ownership Plan or ESOP.

Pursuant to our equity incentive plans, options to purchase approximately [removed: 8,666,698] [added: 8,703,249] shares of common stock were outstanding as of February [removed: 17, 2017.][added: 16, 2018.]

[removed: We filed a registration statement under the Securities Act, which covers the shares] available for issuance under our equity incentive plans (including for such outstanding options) as well as shares held for resale by our existing stockholders that were previously issued under our equity incentive plans.

We are a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be [added: beneficial to our existing stockholders.]

As cyber threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any information security vulnerabilities or incidents.

Despite efforts to ensure the integrity of our systems and implement controls, processes, policies and other protective measures, we may not be able to anticipate all security breaches, nor may we be able to implement guaranteed preventive measures against such security breaches.

Cyber threats are rapidly evolving and we may not be able to anticipate or prevent all such attacks and could be held liable for any security breach or loss.

Our business relies on the secure processing, transmission, storage and retrieval of confidential, proprietary and other information in our computer and data management systems and networks, and in the computer and data management systems and networks of third parties.

In addition, to access our network, products and services, our customers and other third parties may use personal mobile devices or computing devices that are outside of our network environment and are subject to their own cybersecurity risks.

A downturn or perceived downturn in the economy,

We filed a registration statement under the Securities Act, which covers the shares

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

varied protection for intellectual property rights in some countries.

beneficial to our existing stockholders.

We organize our business in two segments: [removed: Risk Assessment and] Decision [removed: Analytics.][added: Analytics and Risk Assessment.]

Our Risk Assessment segment revenues represented [removed: 36.3%] [added: 35.9%] and [removed: 39.1%] [added: 36.3%] of our revenues for the years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively.

Our Decision Analytics segment revenues represented approximately [removed: 63.7%] [added: 64.1%] and [removed: 60.9%] [added: 63.7%] of our revenues for the years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively.

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

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

See Note [removed: 10] [added: 9] of our consolidated financial statements included in this annual report on Form 10-K.

For the years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015, 16.5%] [added: 2016, 19.2%] and [removed: 17.2%] [added: 16.5%] of our revenues were derived from providing transactional recurring and non-recurring solutions, respectively.

For the [removed: the] years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015, 92.0%] [added: 2016, 90.8%] and [removed: 90.1%] [added: 92.0%] of the revenues in our Risk Assessment segment were derived from subscriptions and long-term agreements for our solutions, respectively.

[removed: Our customers in this segment include most of the P&C insurance providers in the U.S.] For the years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015, 78.6%] [added: 2016, 75.2%] and [removed: 78.1%] [added: 78.6%] of the revenues in our Decision Analytics segment were derived from subscriptions and long-term agreements for our solutions, respectively.

Personnel expenses, which represented [removed: 47.7%] [added: 50.1%] and [removed: 46.5%] [added: 47.7%] of our total expenses for the years ended December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively, include salaries, benefits, incentive compensation, equity compensation costs, sales commissions, employment taxes, recruiting costs, and outsourced temporary agency costs.

For insurers, the keys to profitability include [added: increasing] investment [removed: income and] [added: income,] premium [removed: growth.][added: growth and disciplined underwriting of risks.]

Growth in 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, 4.4% in [removed: 2014] [added: 2014, 3.7% in 2015] and 3.7% in [removed: 2015.][added: 2016.]

Based on our experience, insurers more closely scrutinize their spending in periods of more challenging [removed: growth.][added: growth and tend to focus on making an underwriting profit.]

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

We will continue to evolve our offerings to meet the needs of our customers in [removed: an] [added: a dynamic market and remain] increasingly [removed: complex market.][added: well positioned to serve our customers' information and analytical needs.]

We acquired [removed: twelve] [added: twenty-one] businesses since January 1, [removed: 2014.][added: 2015.]

MarketStance has become part of [removed: ISO within the] [added: our] Risk Assessment segment.

MarketStance has built a proprietary analytics model to provide actionable insights on customer's profitability [removed: and] that enhances our [added: existing] offerings.

See Note [removed: 9] [added: 8] to our consolidated financial statements included in this annual report on Form 10-K for further [removed: discussions.][added: discussions on the below acquisitions.]

The data and subscriptions business has become part of [removed: Wood Mackenzie] [added: the energy vertical] within the Decision Analytics segment and complements its existing upstream analysis expertise.

On July 26, [removed: 2016,we] [added: 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 [removed: Wood Mackenzie] [added: the energy vertical] within the Decision Analytics segment and enables [removed: Wood Mackenzie] [added: us] to provide [removed: its] [added: our] customers with market intelligence across several categories, including solar generation, energy storage, and smart grids that react to changes in supply and demand.

RII enhances the ability of [removed: the Company's] [added: our] Risk Assessment segment to serve the international insurance market.

PCI has become part of [removed: Wood Mackenzie,] [added: the energy vertical,] and continues to provide services to enhance [removed: Wood Mackenzie's] [added: our] chemicals capabilities in the Decision Analytics segment.

[removed: See] [added: For a discussion of recent accounting pronouncements, refer to] Note [removed: 9] [added: 2(r)] to [removed: our] [added: the audited] consolidated financial statements included [added: elsewhere] in this annual report on Form [removed: 10-K for the final purchase price allocations.][added: 10-K.]

Infield has become part of [removed: Wood Mackenzie] [added: the energy vertical] and continues to provide services to enhance [removed: Wood Mackenzie's] [added: our] upstream and supply chain capabilities in the Decision Analytics segment.

Both [removed: categories,] [added: types of categories within Risk Assessment,] industry-standard insurance programs and property-specific rating and underwriting information, [removed: within Risk Assessment] contributed to its revenue growth.

Cost of revenues was $714.4 million for the year ended December 31, 2016 compared to $612.0 million for the year ended December 31, 2015, an increase of $102.4 million or [removed: 16.7%.][added: 16.7% .]

These increases were offset by [removed: a decrease] [added: decreases] in information technology expense of $0.9 million and other general and administrative of $0.9 million.

Our EBITDA margin for the year ended December 31, 2016 was positively impacted by the discontinued operations, including the gain on sale of our healthcare [added: business, of 15.6%.]

[added: Our EBITDA margin for the year ended December 31, 2016 was positively impacted by the discontinued operations, including the gain on sale of our healthcare] business, of 10.0%, which was partially offset by the impacts from an ESOP charge of 0.9%.

Revenues for our Decision Analytics segment were $1,270.9 million for the year ended December 31, 2016 compared to $1,072.5 million for the year ended December 31, 2015, an increase of $198.4 million or [removed: 18.5% .][added: 18.5%.]

The [removed: non-recurring] [added: nonrecurring] derivative gain, net of transaction costs related to the Wood Mackenzie acquisition and the warrant exercise and payout, positively impacted our EBITDA margin by 5.4%, which was offset by the impact from the discontinued operations of 5.9% for year ended December 31, 2015.

[removed: Excluding the impact of our recent acquisitions, our cost of revenues increased $22.4 million or 11.2%] The increase was primarily due to increases in salaries and employee benefit costs of $10.3 million, an ESOP charge of $8.3 million, data costs and data processing fees of $1.1 million, information technology expense of $1.1 million, and other operating costs of $1.6 million.

Year Ended December 31, [removed: 2015] [added: 2017] Compared to Year Ended December 31, [removed: 2014][added: 2016]

Revenues were [removed: $1,760.7] [added: $2,145.2] million for the year ended December 31, [removed: 2015] [added: 2017] compared to [removed: $1,431.1] [added: $1,995.2] million for the year ended December 31, [removed: 2014,] [added: 2016,] an increase of [removed: $329.6] [added: $150.0] million or [removed: 23.0%.][added: 7.5%.]

Excluding [added: the impact of our] recent acquisitions, [added: our cost of] revenues increased [removed: $110.0] [added: $24.1] million or [removed: 7.7%.][added: 3.4%.]

Revenue growth within Decision Analytics was primarily driven by our insurance [removed: and financial services] categories.

Cost of revenues was [removed: $612.0] [added: $783.8] million for the year ended December 31, [removed: 2015] [added: 2017] compared to [removed: $516.0] [added: $714.4] million for the year ended December 31, [removed: 2014,] [added: 2016,] an increase of [removed: $96.0] [added: $69.4] million or [removed: 18.6%.][added: 9.7%.]

Our recent acquisitions within the Decision Analytics segment [removed: accounted for] [added: represented] an increase of [removed: $82.4] [added: $39.6] million in cost of revenues, [removed: of] which [removed: $6.0 million were non-recurring equity compensation associated with the Wood Mackenzie acquisition and the remaining amount] was primarily related to salaries and employee benefits.

Our customers in this segment include most of the P&C insurance providers in the U.S.

In addition, 2017 has been a challenging year for insurers with the catastrophe losses related to the three major hurricanes - Harvey, Irma, and Maria - making landfall in the U.S. in the third quarter 2017 causing insurance industry’s net income to decline.

These events also illustrate the need for broader coverages, such as flood to meet the changing needs of communities.

We continue to provide the necessary resources to meet insurer needs.

During 2017, oil prices showed a modest improvement and we expect a continued sense of optimism in the energy markets in 2018.

In the upstream sector there are five global trends.

First, capital investments are anticipated to grow moderately in 2018, signaling an end to the period of reductions since 2014.

Second, there is a surge in tight oil production in 2018 driven by a considerable increase from the Permian Basin in the U.S. (a region benefiting from new fracking production technology).

Third, over-supplies in the service sector provide an opportunity for operators to lock in prices below historical market rates.

Fourth, opportunities from discovered resources and exploration have been increasingly undertaken.

Several Middle Eastern countries expect to award significant contracts to further develop discovered resources.

In addition, there will likely be growing interest in Latin American opportunities.

Fifth, many countries are reviewing their existing fiscal policies to ensure that they are competitive, as well as developing new terms to attract investment in new opportunities.

In terms of the wider energy sector, we foresee the continued growth of the electric vehicle market, albeit from a low base, which is anticipated to develop into one of the most disruptive forces in the sector.

Falling renewable energy costs around the world will also underpin the ongoing shift towards a low carbon economy.

As we look forward towards 2018, increasing trends in delinquency and fraud rates have resulted in an increased demand for robust risk solutions.

In order to better serve our customers, add to our data asset, and expand our expertise, we made a number of strategic acquisitions in the

past year, most importantly (1) G2, which provides merchant risk intelligence solutions for acquirers, commercial banks and their value chain partners.

G2 provides solutions to manage and monitor merchant and business risk within an increasingly complex payments ecosystem using advanced artificial intelligence technologies combined with expert analysts.

(2) LCI, a company that provides bankruptcy management solutions to improve customer's profitability through recovery of bankrupt accounts while protecting the customer's brand by conforming to industry compliance.

LCI maintains bankruptcy data (servicing more than 1.3 billion accounts), bankruptcy process automation software, expert services, and research to automate expensive processes in the bankruptcy lifecycle.

(3) Fintellix, a company that provides Risk and Regulatory Reporting solutions to enterprise banks at a significantly lower cost of compliance, as well as jumpstarting analytics capabilities in smaller and regional banks.

We stand confident of our position with these acquisitions, with the proprietary data and solutions we offer, to help our customers achieve their business and regulatory objectives.

2017 Acquisitions

On December 29, 2017, we acquired 100 percent of the stock of PowerAdvocate, Inc., or PowerAdvocate, a provider of market, cost intelligence, and supply chain solutions serving the energy sector.

Within our Decision Analytics segment, PowerAdvocate expands our offerings to the energy sector by adding proprietary spend data and cost models and providing insight into customers' cost savings opportunities.

On December 22, 2017, we acquired the net assets of Service Software, LLC., or Service Software, a provider of business management software for the construction industry.

Within our Decision Analytics segment, Service Software expands our offerings to the insurance sector by integrating with the existing loss quantification solutions, which makes it possible for restoration professionals to save time by sharing job information, reducing duplicate data entry, and increasing productivity.

On November 9, 2017, we acquired 100 percent of the stock of Rebmark Legal Solutions Ltd., or Rebmark, a provider of injury claims solutions, within the Decision Analytics segment.

Rebmark’s solutions aid claimant and defendant lawyers, barristers, and claims handlers with the preparation of schedules of loss, which is useful in complex, high-value injury claims where calculations can be time-consuming and there is greater potential for error.

On August 31, 2017, we acquired 100 percent of the stock of Lundquist Consulting, Inc., or LCI, a provider of risk insight, prediction, and management solutions for banks and creditors.

LCI has become part of the financial services vertical within the Decision Analytics segment.

This acquisition brings together our proprietary data assets and LCI's proprietary time-series data, including consumer and commercial bankruptcies, consumer behavior, and legal and technical terms associated with debtor settlements.

On August 23, 2017, we acquired 100 percent of the stock of Sequel Business Solutions Ltd., or Sequel, a provider of commercial and specialty insurance and reinsurance software based in the U.K. Sequel has become part of the insurance vertical within the Decision Analytics segment.

The acquisition of Sequel further enhances our comprehensive offerings to the global complex commercial and specialty insurance industry, enabling integrated global data analytics through a specialized end-to-end workflow solution.

On August 3, 2017, we acquired 100 percent of the stock of G2 Web Services LLC, or G2, a provider of merchant risk intelligence solutions for acquirers, commercial banks, and other payment system providers.

G2 has become part of the financial services vertical within the Decision Analytics segment.

The acquisition of G2 positions us to further enhance our offerings to clients and partners, by providing solutions that help fight fraud, transaction laundering, and reputational risk within the global payments and e-commerce ecosystem.

During the three months ended June 30, 2017, we acquired the net assets of Blue Skies Consulting, LLC, ControlCam, LLC, Krawietz Aerial Photography, LLC, Richard Crouse & Associates, Inc., Rocky Mountain Aerial Surveys, Inc., Skyview Aerial Photo, Inc., and Valley Air Photos, LLC , altogether the Aerial Imagery acquisitions, a group of similar but unrelated companies, which give us broad geographic coverage of the U.S. for aerial image capture purposes.

The Aerial Imagery acquisitions provide multi-spectral aerial photographic services with expertise in offering digital photogrammetric and remote sensing data for mapping and surveying applications.

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

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.

The ongoing incentivizing of growth in renewable energy and other low carbon 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.

Most notable among the recent trends affecting the vertical includes a significant increase in the number of alternative lenders and alternative payment instruments in the market.

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

As well, our unique ability to analyze the customer adoption rates of new alternative payment instruments from our syndicated study datasets is enabling us to serve as the “go to” solution for the industry’s analytic needs in the space.

A strengthening of the U.S. dollar relative to the currencies of our international customers and a softening of the global economy is putting an even greater level of

downward pressure on our revenues from such customers.

However, we are also observing a growing appetite for our expense-focused solutions and regulatory-focused solutions among those customers.

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

We stand confident of our position at this stage, given the unique nature and strength of our partnerships coupled by the comprehensiveness of our data, particularly as it relates to seeing the full wallet spend of a consumer.

On December 8, 2014, we acquired 100 percent of the stock of Maplecroft.

Using a proprietary data aggregation and analytical approach, Maplecroft enables its customers to assess, monitor, and forecast a growing range of worldwide risks, including geopolitical and societal risks.

Within our Decision Analytics segment, this acquisition positions us as a provider of value chain optimization tools, providing comprehensive quantitative risk analytics and platforms by which customers can visualize, quantify, mitigate, and manage their risk.

Maplecroft is headquartered in Bath, England.

On October 31, 2014, we acquired the net assets of Dart Consulting Limited, or Dart.

Dart is a provider of benchmarking and advisory solutions to financial services institutions in Australia, New Zealand, and other key Asia-Pacific markets.

As part of our Decision Analytics segment, Dart provides benchmarking solutions and professional services critical to financial services institutions in the management of lending and payment portfolios.

On January 29, 2014, we acquired the net assets of Inovatus, LLC, or Inovatus.

The assets primarily consisted of software and are embedded in our existing models focusing on reducing fraud and premium leakage for personal auto insurance carriers.

The technology is included in our Decision Analytics segment as part of its solutions to leverage data and analytics to help insurance companies improve results.

On March 11, 2014, we sold our mortgage services business, Interthinx, for a price of $151.2 million.

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

Gain on Derivative Instruments

In December 2014, we acquired Maplecroft and in 2015, we acquired Wood Mackenzie, Infield, and PCI, all within our Decision Analytics segment; these comprise our recent acquisitions.

These recent acquisitions provided an increase of $219.6 million in revenues for the year ended December 31, 2015.

Other increases include data costs and data processing fees of $2.4 million, rent expense of $2.2 million, travel expense of $2.0 million, and other operating costs of $1.5 million.

These increases were offset by a decrease in professional consulting fees of $3.6 million.

The increase was primarily related to intangible assets associated with our recent acquisitions of $44.0 million.

Excluding recent acquisitions, the amortization of intangible assets decreased $3.7 million associated with assets from prior acquisitions that have been fully amortized.

The increase was primarily related to a gain of $15.6 million in connection with the exercise and payout of common stock warrants.

The remaining increase was mostly attributable to a net gain on foreign currencies.

Gain on derivative instruments was $85.2 million for the year ended December 31, 2015 resulting from the execution of a nonrecurring foreign currency hedging strategy in connection with the acquisition of Wood Mackenzie within our Decision Analytics segment.

At December 31, [removed: 2016,] [added: 2017,] we had borrowings outstanding under our credit facility of [removed: $100.0] [added: $715.0] 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: 2016,] [added: 2017,] a one percent change in interest rate would result in a change in annual pre-tax interest expense of approximately [removed: $1.0] [added: $7.2] 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: 2016.][added: 2017.]

The information required by this Item is set forth on pages 54 through [removed: 102] [added: 106] of this annual report on Form 10-K.

Verisk [removed: Analytics] is a leading data analytics provider serving customers in insurance, [removed: natural resources] [added: energy] and [added: specialized markets, and] financial services.

We believe our solutions for analyzing risk [removed: positively] [added: have a positive] impact [added: on] our customers’ revenues and help them better manage their costs.

In [removed: 2016,] [added: 2017,] our customers included all of the top 100 property and casualty, or P&C, insurance providers in the U.S. for the lines of P&C services we offer, and [removed: 28] [added: all] of the top 30 credit card issuers in North America, the United Kingdom and Australia, as well as [removed: 8] [added: 9] of the top 10 global energy providers around the world.

- Deep Domain Expertise - We have specialized and in-depth knowledge in a number of defined vertical markets, including insurance, [removed: healthcare,] energy, financial services, and risk management.

Typically, the marketplace assumes that those [removed: that] [added: who] 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 over 80% of our revenues in [removed: 2016.][added: 2017.]

For the year ended December 31, [removed: 2016,] [added: 2017,] we had revenues of [removed: $1,995.2] [added: $2,145.2] million and net income of [removed: $591.2] [added: $555.1] million.

For the five year period ended December 31, [removed: 2016,] [added: 2017,] our revenues and net income grew at a compound annual growth rate, or CAGR, of [removed: 13.9%] [added: 12.8%] and [removed: 15.8%,] [added: 12.4%,] respectively.

Verisk was initially formed as a wholly-owned subsidiary [removed: of ISO.]

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

We organize our business in two segments: [removed: Risk Assessment and] Decision [removed: Analytics.][added: Analytics and Risk Assessment.]

See Note [removed: 18] [added: 17] of our consolidated financial statements included in this annual report on Form 10-K for further information.

Our Risk Assessment segment serves our P&C insurance customers and focuses on [added: the] prediction of loss, [added: the] selection and pricing of 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. In recent [removed: years] [added: years,] we have expanded our offerings to also serve certain non-U.S. markets.

We provide policy language, prospective loss costs, policy writing rules, and a variety of other solutions for [removed: 26] [added: 29] lines of insurance.

To meet their needs, we process approximately 2,400 regulatory filings and interface with state regulators in all 50 states plus the District of Columbia, Guam, Puerto [removed: Rico] [added: Rico,] and the Virgin Islands each year to ensure smooth implementation of our rules and forms.

Standardized coverage language, which has been tested in litigation and tailored to reflect judicial interpretation, helps [removed: to] ensure consistent treatment of claimants.

We have more than 120 specialized lawyers and insurance experts reviewing changes in each state’s insurance rules and regulations, including an average of more than [removed: 16,500] [added: 13,500] legislative bills, [removed: 6,100] [added: 9,000] 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 homeowners line of insurance, we maintain policy language and rules for 6 basic coverages, [removed: 289] [added: 292] national endorsements, and [removed: 601] [added: 633] state-specific endorsements.

Each year, P&C insurers send us approximately [removed: 3.5] [added: 3.8] billion detailed individual records of insurance transactions, such as insurance premiums collected or losses incurred.

We maintain a database of more than [removed: 20.0] [added: 21.0] billion statistical records, including approximately [removed: 8.2] [added: 8.6] billion commercial lines records and approximately [removed: 11.8] [added: 12.4] billion personal lines records.

[removed: In addition, our actuarial consultants provide customized services for our] 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 also supply information to [removed: a wide variety of] [added: various] customers in other markets including reinsurance and government agencies.

For most P&C insurers, in most lines of business, we believe [added: that] our estimates of future costs are an essential input to rating decisions.

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

Our property-specific rating and underwriting [removed: information] [added: data and analytics] allow our customers to understand, quantify, [removed: underwrite,] mitigate, and avoid potential [removed: loss] [added: losses, while matching price] to [removed: commercial properties.][added: exposure.]

[added: Our ProMetrix® platform contains information on 6 million commercial buildings, 26 million businesses, and virtually all communities in the U.S.] We have a staff of approximately 600 field representatives strategically located around the U.S. who observe and report on conditions at commercial and residential properties, evaluate community fire-protection capabilities and assess the effectiveness of municipal building-code enforcement.

Each year, our field staff visits [removed: over] [added: approximately] 285,000 commercial properties to collect information on new buildings and verify building attributes.

To supplement our data on specific commercial properties and individual communities, we have assembled, from a variety of internal and select third-party sources, information on hazards related to geographic locations representing every postal address in the U.S. Insurers use this information for policy quoting and analyzing risk concentration in geographical [added: areas.]

Our solutions are built on unique data sets [removed: which] [added: that] are dynamic and updated based on new data and events.

We have a comprehensive system used by claims adjusters and [removed: investigations] [added: investigation] professionals to process claims and fight fraud.

Our database contains information [removed: on approximately 1.1] [added: for more than 1.2] billion claims and is the world’s largest database of P&C claims information used for claims and investigations.

We are also a leader in and pioneered the field of probabilistic catastrophe modeling used by insurers, [removed: reinsurers and] [added: reinsurers,] financial [removed: institutions] [added: institutions, and government] to manage their [removed: catastrophe risk.][added: risk from extreme events.]

Our [removed: models of global natural hazards,] [added: models,] which form the basis of our solutions, enable companies to identify, quantify and plan for the financial consequences of [removed: catastrophic events.][added: catastrophes.]

We have developed [removed: models, covering natural hazards, including] [added: models for] hurricanes, earthquakes, winter storms, tornadoes, hailstorms, and [removed: floods, for potential loss events] [added: floods] in more than 100 countries, as well as pandemics worldwide.

We have [removed: also] developed [removed: and introduced] a probabilistic terrorism model capable of quantifying the risk in the U.S. from this [removed: emerging] [added: evolving] threat, which supports pricing and underwriting decisions down to the level of an individual [removed: policy.][added: policy, as well as models for estimating losses to crop insurance programs in the U.S., Canada and China.]

| • | aiding in the settlement of insurance claims, [added: and] |

[added: The program allows our customers to sketch floor plans, roof plans] and wall-framing plans and automatically calculates material and labor quantities for the construction of walls, floors, footings, and roofs.

We revise this information monthly, [removed: and,] [added: and] in the aftermath of a major disaster, we can update the price lists as often as weekly to reflect rapid price changes.

We estimate that [removed: about] [added: more than] 80% of insurance repair contractors and service providers in the U.S. and Canada with computerized estimating systems use our building and repair pricing data.

of ISO.

In 2017, we acquired a group of similar but unrelated companies for aerial image capture purposes, or Aerial Imagery acquisitions, in our insurance vertical.

Additionally, in 2017, we acquired G2 Web Services, LLC, or G2; Sequel Business Solutions Ltd., or Sequel; Lundquist Consulting, Inc., or LCI; and PowerAdvocate, Inc., or PowerAdvocate, to further strengthen our position in the insurance, financial services and energy verticals.

The Aerial Imagery acquisitions provide multi-spectral aerial photographic services with expertise in offering digital photogrammetric and remote sensing data for mapping and surveying applications.

G2 provides merchant risk intelligence solutions for acquirers, commercial banks, and other payment system providers.

Sequel is a leading insurance and reinsurance software specialist based in London.

LCI offers risk insight, prediction, and management solutions for banks and creditors.

PowerAdvocate is a leading data analytics provider with a one-of-a-kind spend and cost data that are curated from millions of transactions across thousands of services, materials, and equipment categories in the energy industry.

Our newest models offer risk management solutions for the cyber and casualty lines of business.

In addition, we provide an efficient multitier, multispectral terrestrial imagery and data acquisition, processing, analytics, and distribution system.

Using the latest remote sensing and machine learning technologies, we gather, store, process, and deliver geographic and spatially referenced information that supports uses in many markets, including insurance, commercial property, energy, banking, architecture, engineering, emergency response, and urban planning.

Mapping professionals and firms leverage our data to accurately understand growth and change, determine damage, discover hazards, assess risk, and perform valuations.

the insurer.

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.

We maintain the largest bank account consortia to provide competitive benchmarking, decisioning algorithms, business intelligence, and customized analytic services to financial institutions, payment networks and processors, alternative lenders, regulators and merchants - enabling better strategy, marketing, and risk decisions.

Our teams are located across U.S., U.K., Canada, Australia, New Zealand, the United Arab Emirates, and India, delivering unique products and services to an expanding customer base.

Complimenting this, we leverage our partnerships with processors and credit bureaus, to not only augment the richness of our data, but also to provide expanded solutions across the broad span of consumer banking and retail products.

Meanwhile, we offer services and a suite of solutions to satisfy growing customer needs for better forecasting and expense tools, and regulatory-focused solutions.

In addition, we provide solutions in the media effectiveness space given the unique nature and strength of our partnerships, the comprehensiveness of our data and the full wallet spend view of a consumer.

analysis and analytical solutions.

In addition, our actuarial consultants provide customized services for our

We believe we can continue to expand

We estimate that more than 80% of insurance repair contractors and service providers in the U.S. and Canada with computerized estimating systems use our building and repair pricing data.

opportunities for their assigned products and segments.

Sixth, we independently collect data on geographic and spatially referenced information relating to residential and commercial structures by using the latest remote sensing and machine learning technologies.

revenue.

The contents of our website are not incorporated into this filing.

Our ProMetrix operating platform contains business and risk information on 26 million entities, loss costs and other vital information on more than 3.7 million commercial buildings in the U.S. and also holds information on more than 6.5 million individual businesses occupying those buildings.

areas.

Our newest model also addresses cyber losses.

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

We focus on providing competitive benchmarking, scoring solutions, analytics, and customized services to financial services institutions in the Americas, Europe, the Middle East, Africa and Asia-Pacific.

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 also maintain the most comprehensive depersonalized direct observation consortium data sets for the payments industry.

We leverage our consortium data and provide proprietary solutions and information that enable customers to achieve higher profitability and growth through enhanced marketing and risk management decisions.

We have deployed unique technology to manage vast data sets efficiently and manage vast amount of payments data.

We offer services and a suite of solutions to a customer base that includes credit and debit card issuers, retail banks and other consumer financial services providers, payment processors, insurance companies, and other industry stakeholders.

governments, and markets.

our actuarial services and industry-standard insurance programs.

created from their data.

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

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 our subsidiary Intellicorp Records, [removed: Inc. (“Intellicorp.”)] [added: Inc., or Intellicorp,] titled Sherri Legrand v.

Plaintiffs filed their First Amended Class Action Complaint on November 5, [removed: 2015 (“Amended Complaint”),] [added: 2015, or Amended Complaint,] which like the prior complaint claims violations of the Fair Credit Reporting [removed: Act ("FCRA")] [added: Act, or 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 [removed: Intellicorp] [added: 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 [removed: prepared] [added: prepared,] and (ii) a section 1681e(b) claim on behalf of all individuals who were the subjects of consumer reports furnished by [removed: Intellicorp] [added: 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.

Counts II and III allege that Intellicorp violated the FCRA section 1681e (b) by failing to follow reasonable procedures to assure maximum accuracy of the adverse information included in its consumer reports and FCRA section 1681k (a) by failing to maintain strict procedures to assure that the public record information [removed: reported] [added: reported,] which was likely to have an adverse effect on the consumer was complete and up to date, respectively.

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

The complaint alleges that our Roof InSight, Property InSight and Aerial Sketch products [added: infringe seven patents owned by Eagle View and Pictometry namely, Patent Nos. 436, 840, 152, 880, 770, 732 and 454.]

[removed: infringe seven patents owned by Eagle View and Pictometry namely, Patent Nos. 436, 840, 152, 880, 770, 732 and 454 (collectively the “Patents-in-Suit”)] On November 30, 2015, plaintiffs filed a First Amended Complaint [removed: (“First Amended Complaint”)] adding Patent Nos. 376 and 737 to the Patents in Suit.

The 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 [removed: Patents in Suit,] [added: Patents-in-Suit,] permanent injunctive relief, damages, costs and attorney’s fees.

Plaintiffs claim that we and ISO, along with all [removed: of] the other defendants, violated state and federal antitrust and racketeering laws as well as state common law.

It claims that we and ISO, along with all [removed: of] the other defendants, violated state and federal antitrust and racketeering laws as well as state common law, and seeks all available relief [removed: including,] [added: including] injunctive, statutory, actual and punitive damages as well as attorneys’ fees.

On April 24, 2017, the parties agreed to resolve the litigation in a Settlement Agreement and Release and plaintiffs filed their Motion for Preliminary Approval of the settlement on the same day.

The settlement provides for a non-material cash payment by us, as well as certain non-monetary relief.

The District Court granted the Motion for Preliminary Approval on April 25, 2017 and issued its Final Approval Order on October 31, 2017.

On May 17, 2017, the District Court so ordered a Joint Stipulated Order of Partial Dismissal with Prejudice dismissing all claims or assertions pertaining to Pictometry Patents Nos. 880 and 732 and certain enumerated claims or assertions pertaining to Eagle View Patents Nos. 436, 840, 152, 770, 454, 376 and 737, or collectively the “Patents in Suit”.

On April 6, 2017, the Court of Appeals for the 10th Circuit affirmed the Court’s dismissal of the Third Amended Complaint.

Appellants filed a motion for en banc reconsideration of the 10th Circuit’s affirmance of the dismissal of the Third Amended Complaint which was denied on May 26, 2017.

Appellants filed their petition for a writ of certiorari in the Supreme Court on August 24, 2017 which was denied on October 30, 2017.

Plaintiffs filed a Petition for Rehearing to the Supreme Court on November 27, 2017 which was denied on January 8, 2018.

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 Intellicorp.

The complaint titled Frank DiSalvo v.

Intellicorp Records, Inc. claims violations of the 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.

The class complaint alleges that Intellicorp violated the FCRA section 1681b(b)(1) by failing to obtain the required specific certification from its customers to whom Intellicorp furnished consumer reports as to each consumer report provided before providing the specific consumer report that was the subject of the certification.

The complaint alleges that the violations were willful or in the alternative negligent and seeks statutory damages for the class 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 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.

Interthinx, Inc. Litigation

On April 20, 2015, we were served with a putative class action titled John Weber v.

Interthinx, Inc. and Verisk Analytics, Inc. The plaintiff, a former employee of 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 class complaint claims that the review appraiser employees were misclassified as exempt employees and, as a result, were denied certain wages and benefits that would have been received if they were properly classified as non-exempt employees.

It pleads a Collective Action under section 216(b) of the Fair Labor Standards Act for unpaid overtime and seeks overtime wages, liquidated damages, declaratory relief, interest, costs and attorneys’ fees.

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.

v.

On February 19, 2016, we were served with a notice of a summons and complaint filed on January 29, 2016 against ISO in the U.S. District Court for the District of Connecticut titled Halloran et al.

Harleysville Preferred Insurance Co. et al.

As alleged in the First Amended Complaint, the putative class action is brought by four policyholders on behalf of a class of similarly situated policyholders in eastern Connecticut who allege that their homeowner’s insurance carriers have denied or will deny their claims for damage to their homes caused by defective concrete.

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

It also alleges that ISO as the drafter of the standardized policy language at issue violated the Connecticut Unfair Trade Practices ("CUTPA") and the Connecticut Unfair Insurance Practices Act ("CUIPA").

The plaintiffs ask that the Court certify a class of persons similarly situated and seek relief in the form of the cost for the replacement of their concrete 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.

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.

For the fiscal year ended December 31, [removed: 2016][added: 2017]

(201) [removed: 469-2000][added: 469-3000]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, [removed: or] a smaller reporting [added: company or an emerging growth] company.

See the definitions of “large accelerated filer,” “accelerated [removed: filer” and] [added: filer”,] “smaller reporting company” [added: and “emerging growth company”] in Rule 12b-2 of the Exchange Act.

| [removed: ☑ Large accelerated filer | | ☐ Accelerated] [added: Non-accelerated] filer | | ☐ [removed: Non-accelerated filer] [added: (Do not check if a smaller reporting company)] | | [removed: ☐] Smaller reporting company | [added: | ☐ |]

As of June 30, [removed: 2016,] [added: 2017,] 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: $12,787,681,387] [added: $13,053,902,417] based on the closing price reported on the NASDAQ Global Select Market on such date.

As of February [removed: 17, 2017,] [added: 16, 2018,] there were [removed: 166,341,316] [added: 165,020,572] 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: 2017] [added: 2018] Annual Meeting of Stockholders, which will be filed with the Securities and Exchange Commission not later than 120 days after December 31, [removed: 2016.][added: 2017.]

| | Item 1. | [removed: [Business](#s2E33787F58A15C0EA45407F88B2732E6)] [added: [Business](#s4EC20597942A5C3398C79743870D9051)] | [removed: [4](#s2E33787F58A15C0EA45407F88B2732E6)] [added: [4](#s4EC20597942A5C3398C79743870D9051)] |

| | Item 1A. | [Risk [removed: Factors](#sDD2578BF70445B4290C6E7E4F4E3CB32)] [added: Factors](#s096DA084DB9B5A349DE59C255FA7273B)] | [removed: [15](#sDD2578BF70445B4290C6E7E4F4E3CB32)] [added: [15](#s096DA084DB9B5A349DE59C255FA7273B)] |

| | Item 1B. | [Unresolved Staff [removed: Comments](#s6E33CC6EE2BD542087E515AE1466D361)] [added: Comments](#s4B82643E63685F6DA365EC8D8A22BBE7)] | [removed: [22](#s6E33CC6EE2BD542087E515AE1466D361)] [added: [22](#s4B82643E63685F6DA365EC8D8A22BBE7)] |

| | Item 2. | [removed: [Properties](#sBEEA258077B452C19FDCEF9309F36660)] [added: [Properties](#s3BED494A6CD35E93A6B43AE2DE11F9BA)] | [removed: [22](#sBEEA258077B452C19FDCEF9309F36660)] [added: [22](#s3BED494A6CD35E93A6B43AE2DE11F9BA)] |

| | Item 3. | [Legal [removed: Proceedings](#s8E261597DA1157C0B593E430B0DEA8C0)] [added: Proceedings](#sF52B519EFEB85D79888E32CAA484273F)] | [removed: [23](#s8E261597DA1157C0B593E430B0DEA8C0)] [added: [23](#sF52B519EFEB85D79888E32CAA484273F)] |

| | Item 4. | [Mine Safety [removed: Disclosures](#s346CA0EBD5FD5130B259128EFEA328BD)] [added: Disclosures](#sE33EA8DD12E85355AEC5D89D23A9BA98)] | [removed: [25](#s346CA0EBD5FD5130B259128EFEA328BD)] [added: [24](#sE33EA8DD12E85355AEC5D89D23A9BA98)] |

| | Item 5. | [Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity [removed: Securities](#s6D51DC6E97865326B23E7EC31B7EA0D1)] [added: Securities](#sD0E6751CFA435901A726A557A12F3DEC)] | [removed: [26](#s6D51DC6E97865326B23E7EC31B7EA0D1)] [added: [25](#sD0E6751CFA435901A726A557A12F3DEC)] |

| | Item 6. | [Selected Financial [removed: Data](#s7A7D67CBC90B5A2F88818EBD9098D15A)] [added: Data](#s72B9F4FA7A4E5D6CB0FF536326D00280)] | [removed: [27](#s7A7D67CBC90B5A2F88818EBD9098D15A)] [added: [27](#s72B9F4FA7A4E5D6CB0FF536326D00280)] |

| | Item 7. | [Management’s Discussion and Analysis of Financial Condition and Results of [removed: Operations](#s4D7BF88F074E59C7B5C48D7D9180950B)] [added: Operations](#sDE21ED4B85AD5E489AE8D84CBC68E32B)] | [removed: [31](#s4D7BF88F074E59C7B5C48D7D9180950B)] [added: [30](#sDE21ED4B85AD5E489AE8D84CBC68E32B)] |

| | Item 7A. | [Quantitative and Qualitative Disclosures About Market [removed: Risk](#sA1B95632100B5A11B8881F1A0B11FBA0)] [added: Risk](#s12F583F3F6FD505098211454C2B674C1)] | [removed: [49](#sA1B95632100B5A11B8881F1A0B11FBA0)] [added: [50](#s12F583F3F6FD505098211454C2B674C1)] |

| | Item 8. | [Financial Statements and Supplementary [removed: Data](#s05095ECE752153829AAC9B9049323B9F)] [added: Data](#s5C270CF61D9F5741AE8145114CD0C387)] | [removed: [49](#s05095ECE752153829AAC9B9049323B9F)] [added: [50](#s5C270CF61D9F5741AE8145114CD0C387)] |

| | | [Consolidated Balance [removed: Sheets](#s14CA2B28B08B5F09B423769BCD7E066B)] [added: Sheets](#s39E7F60AC45E524AA4348085C3A12CE1)] | [removed: [57](#s14CA2B28B08B5F09B423769BCD7E066B)] [added: [59](#s39E7F60AC45E524AA4348085C3A12CE1)] |

| | | [Consolidated Statements of [removed: Operations](#s1294B9CB8552503CBD3ED584BB2AD56B)] [added: Operations](#s99A1B8DD05135BF3998211BE25AD53D2)] | [removed: [58](#s1294B9CB8552503CBD3ED584BB2AD56B)] [added: [60](#s99A1B8DD05135BF3998211BE25AD53D2)] |

| | | [Consolidated Statements of Comprehensive [removed: Income](#sB091D03A253B505E8732600AE8264C0A)] [added: Income](#sD8953054BB745D8790CD0704E792A127)] | [removed: [59](#sB091D03A253B505E8732600AE8264C0A)] [added: [61](#sD8953054BB745D8790CD0704E792A127)] |

| | | [Consolidated Statements of Changes in Shareholders’ [removed: Equity](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] [added: Equity](#s6BAF48D07D405527920E532F4554B01A)] | [removed: [60](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] [added: [62](#s6BAF48D07D405527920E532F4554B01A)] |

| | | [Consolidated Statements of Cash [removed: Flows](#sB0843B13B3A557E6ABCF42393826BE6E)] [added: Flows](#sD760F7D88D1C586BAAF096B1BBDE81C9)] | [removed: [61](#sB0843B13B3A557E6ABCF42393826BE6E)] [added: [63](#sD760F7D88D1C586BAAF096B1BBDE81C9)] |

| | | [Notes to Consolidated Financial [removed: Statements](#sC354D685384E5466AE4E8FCCD0E3FC05)] [added: Statements](#s09939ED0FEA758769B53D82CCAACD902)] | [removed: [63](#sC354D685384E5466AE4E8FCCD0E3FC05)] [added: [65](#s09939ED0FEA758769B53D82CCAACD902)] |

| | Item 9. | [Changes in and Disagreements with Accountants on Accounting and Financial [removed: Disclosure](#s56F38CAA8774589896678FF5DDF86E0B)] [added: Disclosure](#s6382B864FE235CD3B81234C63B51AB5D)] | [removed: [49](#s56F38CAA8774589896678FF5DDF86E0B)] [added: [50](#s6382B864FE235CD3B81234C63B51AB5D)] |

| | Item 9A. | [Controls and [removed: Procedures](#sB64E56C7E467568BB567A1C6E99E7DD0)] [added: Procedures](#sDC42CCA932EE5B7B93A83966B28FAAEC)] | [removed: [49](#sB64E56C7E467568BB567A1C6E99E7DD0)] [added: [50](#sDC42CCA932EE5B7B93A83966B28FAAEC)] |

| | Item 9B. | [Other [removed: Information](#s0DA38679DDD05CF69EBE6A8C718B842D)] [added: Information](#s7C7C86E68B55585D81974886A8A43A09)] | [removed: [50](#s0DA38679DDD05CF69EBE6A8C718B842D)] [added: [51](#s7C7C86E68B55585D81974886A8A43A09)] |

| | Item 10. | [Directors, Executive Officers and Corporate [removed: Governance](#s67B8C91C6C315604A035E1966C22C0BA)] [added: Governance](#s1901BE4565435BD19A99D89295327B28)] | [removed: [51](#s67B8C91C6C315604A035E1966C22C0BA)] [added: [52](#s1901BE4565435BD19A99D89295327B28)] |

| | Item 11. | [Executive [removed: Compensation](#s7991128CBA2056A09D3C898E12686942)] [added: Compensation](#s4A00D174EC53532F816EF91B75FA9C7C)] | [removed: [51](#s7991128CBA2056A09D3C898E12686942)] [added: [52](#s4A00D174EC53532F816EF91B75FA9C7C)] |

| | Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#s714B9919543858A1912DC64761557FE9)] [added: Matters](#s3F41291570525DFB96643B363D161EDC)] | [removed: [51](#s714B9919543858A1912DC64761557FE9)] [added: [52](#s3F41291570525DFB96643B363D161EDC)] |

| | Item 13. | [Certain Relationships and Related Transactions and Director [removed: Independence](#s5FAB3F287D2E5D009D01CA5B55B148A9)] [added: Independence](#sA6577A687C1E55209C86716CAEBFE7A4)] | [removed: [51](#s5FAB3F287D2E5D009D01CA5B55B148A9)] [added: [52](#sA6577A687C1E55209C86716CAEBFE7A4)] |

| | Item 14. | [Principal Accounting Fees and [removed: Services](#sA1524CDA63785DD885CA9EEA9E905581)] [added: Services](#sE5FA1088F7B4565FAA0E041BDDAD3990)] | [removed: [51](#sA1524CDA63785DD885CA9EEA9E905581)] [added: [52](#sE5FA1088F7B4565FAA0E041BDDAD3990)] |

| | Item 15. | [Exhibits and Financial Statement [removed: Schedules](#s9318E0A92871518097D1FD2F6211EC90)] [added: Schedules](#sB4B11D4F1864548D81A852353569A0E1)] | [removed: [52](#s9318E0A92871518097D1FD2F6211EC90)] [added: [53](#sB4B11D4F1864548D81A852353569A0E1)] |

| | Item 16. | [Form 10-K [removed: Summary](#s6bb30174d1204b0497b69b17cfea43e9)] [added: Summary](#s6199E45F4D4B52D1B1B17F4C35D8CCDF)] | [removed: [52](#s6bb30174d1204b0497b69b17cfea43e9)] [added: [53](#s6199E45F4D4B52D1B1B17F4C35D8CCDF)] |

10-K 1 vrsk10k12312017.htm 10-K

| Large accelerated filer | | ☑ | | Accelerated filer | | ☐ |

| | | | | | | |

| | | | | | | |

| | | | | Emerging growth company | | ☐ |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

| | | [SIGNATURES](#s7626DE8301BA5802920AE3C908A2211A) | [107](#s7626DE8301BA5802920AE3C908A2211A) |

| | | [EXHIBIT INDEX](#sB5A11A8AE6645233B625E2D9981A9201) | [108](#sB5A11A8AE6645233B625E2D9981A9201) |

10-K 1 vrsk10k12312016.htm 10-K

| (Do not check if a smaller reporting company) | | | | | | |

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

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

| | | Exhibit 10.16 | |

| | | Exhibit 10.17 | |

As of December 31, [removed: 2016,] [added: 2017,] our principal offices consisted of the following properties:

We also lease offices in [removed: 16] [added: 24] states in the U.S., and offices outside the U.S. to support our international operations in Argentina, Australia, [added: Austria,] Bahrain, Brazil, Canada, China, Denmark, Germany, India, Indonesia, Ireland, Israel, Japan, Kazakhstan, Malaysia, Mexico, Nepal, [added: New Zealand,] Nigeria, [added: Peru,] Russia, Singapore, South Africa, South Korea, Spain, Thailand, the United Arab [removed: Emirates] [added: Emirates,] and the U.K.

As of February [removed: 17, 2017,] [added: 16, 2018,] the closing price of our common stock was [removed: $84.90] [added: $98.79] per share, as reported by the NASDAQ Global Select Market.

As of February [removed: 17, 2017,] [added: 16, 2018,] there were approximately [removed: 40] [added: 41] stockholders of record.

We have a publicly announced share repurchase plan and repurchased a total of [removed: 50,636,328] [added: 53,992,688] shares since our IPO through December 31, [removed: 2016.][added: 2017.]

| Fourth Quarter | | $ | [removed: 84.15] [added: 96.45] | | | $ | [removed: 79.36] [added: 83.33] | | | $ | [removed: 81.50] [added: 84.15] | | | $ | [removed: 69.03] [added: 79.36] | |

| Third Quarter | | $ | [removed: 85.75] [added: 87.32] | | | $ | [removed: 79.43] [added: 79.23] | | | $ | [removed: 78.60] [added: 85.75] | | | $ | [removed: 70.77] [added: 79.43] | |

| Second Quarter | | $ | [removed: 81.08] [added: 84.37] | | | $ | [removed: 76.00] [added: 76.75] | | | $ | [removed: 76.85] [added: 81.08] | | | $ | [removed: 71.53] [added: 76.00] | |

| First Quarter | | $ | [removed: 79.92] [added: 85.19] | | | $ | [removed: 65.95] [added: 79.35] | | | $ | [removed: 72.27] [added: 79.92] | | | $ | [removed: 62.70] [added: 65.95] | |

Each peer issuer was weighted according to its respective market capitalization on December 31, [removed: 2011.][added: 2012.]

Assumes $100 Invested on December 31, [removed: 2011][added: 2012]

Fiscal Year Ended December 31, [removed: 2016][added: 2017]

[removed: ][added: ]

There were no unregistered sales of equity securities by the Company during [removed: 2016.][added: 2017.]

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

As of December 31, [removed: 2016, $636.0] [added: 2017, $366.2] million remains available for share repurchases.

As of December 31, 2017, we had 379,124,108 shares of treasury stock.

| | | 2017 | | | | | | | | 2016 | | | | | | |

We had no share repurchases for the quarter ended December 31, 2017.

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

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

Our shares repurchased for the quarter ended December 31, 2016 are set forth below:

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

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

| Period | Total Number of Shares Purchased | | | | Average Price Paid per Share | | | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | | | | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs | |

| | | | | | | | | | | | | (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 | | | | | |

The consolidated statement of operations data for the years ended December 31, [added: 2017,] 2016, [removed: 2015] and [removed: 2014] [added: 2015] and the consolidated balance sheet data as of December 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] 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: 2013] [added: 2014] and [removed: 2012] [added: 2013] and the consolidated balance sheet data as of December 31, [added: 2015,] 2014, [removed: 2013] and [removed: 2012] [added: 2013] 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: 2016] [added: 2017] are not necessarily indicative of results that may be expected in any other future period.

Between January 1, [removed: 2012] [added: 2013] and December 31, [removed: 2016,] [added: 2017,] we acquired [removed: 15] [added: 22] businesses (most notably Wood Mackenzie on May 19, 2015), which may affect the comparability of our consolidated financial statements.

| | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |

| Decision Analytics | $ | [removed: 1,270.9] [added: 1,374.9] | | | $ | [removed: 1,072.5] [added: 1,270.9] | | | $ | [removed: 780.5] [added: 1,072.5] | | | $ | [removed: 705.9] [added: 780.5] | | | $ | [removed: 605.4] [added: 705.9] | |

| Risk Assessment | | [removed: 724.3] [added: 770.3] | | | | [removed: 688.2] [added: 724.3] | | | | [removed: 650.6] [added: 688.2] | | | | [removed: 618.3] [added: 650.6] | | | | [removed: 579.5] [added: 618.3] | |

| Revenues | | [removed: 1,995.2] [added: 2,145.2] | | | | [removed: 1,760.7] [added: 1,995.2] | | | | [removed: 1,431.1] [added: 1,760.7] | | | | [removed: 1,324.2] [added: 1,431.1] | | | | [removed: 1,184.9] [added: 1,324.2] | |

| Cost of revenues (exclusive of items shown separately below) | | [removed: 714.4] [added: 783.8] | | | | [removed: 612.0] [added: 714.4] | | | | [removed: 516.0] [added: 612.0] | | | | [removed: 472.5] [added: 516.0] | | | | [removed: 411.5] [added: 472.5] | |

| Selling, general and administrative | | [removed: 301.6] [added: 322.8] | | | | [removed: 278.3] [added: 301.6] | | | | [removed: 187.3] [added: 278.3] | | | | [removed: 186.8] [added: 187.3] | | | | [removed: 183.8] [added: 186.8] | |

| Depreciation and amortization of fixed assets | | [removed: 119.1] [added: 135.6] | | | | [removed: 96.6] [added: 119.1] | | | | [removed: 65.4] [added: 96.6] | | | | [removed: 49.2] [added: 65.4] | | | | [removed: 36.7] [added: 49.2] | |

| Amortization of intangible assets | | [removed: 92.5] [added: 101.8] | | | | [removed: 70.4] [added: 92.5] | | | | [removed: 30.1] [added: 70.4] | | | | [removed: 36.2] [added: 30.1] | | | | [removed: 29.1] [added: 36.2] | |

| Total expenses | | [removed: 1,227.6] [added: 1,344.0] | | | | [removed: 1,057.3] [added: 1,227.6] | | | | [removed: 798.8] [added: 1,057.3] | | | | [removed: 744.7] [added: 798.8] | | | | [removed: 661.1] [added: 744.7] | |

| Operating income | | [removed: 767.6] [added: 801.2] | | | | [removed: 703.4] [added: 767.6] | | | | [removed: 632.3] [added: 703.4] | | | | [removed: 579.5] [added: 632.3] | | | | [removed: 523.8] [added: 579.5] | |

| Investment income and others, net | | [removed: 6.1] [added: 9.2] | | | | [removed: 16.9] [added: 6.1] | | | | [removed: 0.2] [added: 16.9] | | | | [removed: 0.3] [added: 0.2] | | | | [removed: 0.1] [added: 0.3] | |

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

| Interest expense | | [removed: (120.0] [added: (119.4] | ) | | | [removed: (121.4] [added: (120.0] | ) | | | [removed: (70.0] [added: (121.4] | ) | | | [removed: (76.1] [added: (70.0] | ) | | | [removed: (72.5] [added: (76.1] | ) |

| Total other expense, net | | [removed: (113.9] [added: (110.2] | ) | | | [removed: (19.3] [added: (113.9] | ) | | | [removed: (69.8] [added: (19.3] | ) | | | [removed: (75.8] [added: (69.8] | ) | | | [removed: (72.4] [added: (75.8] | ) |

| Income before income taxes from continuing operations | | [removed: 653.7] [added: 691.0] | | | | [removed: 684.1] [added: 653.7] | | | | [removed: 562.5] [added: 684.1] | | | | [removed: 503.7] [added: 562.5] | | | | [removed: 451.4] [added: 503.7] | |

| Provision for income taxes | | [removed: (202.2] [added: (135.9] | ) | | | [removed: (196.6] [added: (202.2] | ) | | | [removed: (208.5] [added: (196.6] | ) | | | [removed: (184.8] [added: (208.5] | ) | | | [removed: (162.7] [added: (184.8] | ) |

| Income from continuing operations | | [removed: 451.5] [added: 555.1] | | | | [removed: 487.5] [added: 451.5] | | | | [removed: 354.0] [added: 487.5] | | | | [removed: 318.9] [added: 354.0] | | | | [removed: 288.7] [added: 318.9] | |

| Income from discontinued operations, net of tax (1) | | [removed: 139.7] [added: —] | | | | [removed: 20.1] [added: 139.7] | | | | [removed: 46.0] [added: 20.1] | | | | [removed: 29.5] [added: 46.0] | | | | [removed: 40.4] [added: 29.5] | |

| Net income | $ | [removed: 591.2] [added: 555.1] | | | $ | [removed: 507.6] [added: 591.2] | | | $ | [removed: 400.0] [added: 507.6] | | | $ | [removed: 348.4] [added: 400.0] | | | $ | [removed: 329.1] [added: 348.4] | |

| Income from continuing operations | $ | [removed: 2.68] [added: 3.36] | | | $ | [removed: 2.95] [added: 2.68] | | | $ | [removed: 2.14] [added: 2.95] | | | $ | [removed: 1.90] [added: 2.14] | | | $ | [removed: 1.74] [added: 1.90] | |

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

| Basic net income per share | $ | [removed: 3.51] [added: 3.36] | | | $ | [removed: 3.07] [added: 3.51] | | | $ | [removed: 2.41] [added: 3.07] | | | $ | [removed: 2.07] [added: 2.41] | | | $ | [removed: 1.98] [added: 2.07] | |

| Income from continuing operations | $ | [removed: 2.64] [added: 3.29] | | | $ | [removed: 2.89] [added: 2.64] | | | $ | [removed: 2.10] [added: 2.89] | | | $ | [removed: 1.85] [added: 2.10] | | | $ | [removed: 1.68] [added: 1.85] | |

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

| Diluted net income per share | $ | [removed: 3.45] [added: 3.29] | | | $ | [removed: 3.01] [added: 3.45] | | | $ | [removed: 2.37] [added: 3.01] | | | $ | [removed: 2.02] [added: 2.37] | | | $ | [removed: 1.92] [added: 2.02] | |

| Basic | | [removed: 168,248,304] [added: 165,168,224] | | | | [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] | |

| Diluted | | [removed: 171,171,572] [added: 168,688,868] | | | | [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] | |

| Decision Analytics EBITDA | $ | [removed: 835.8] [added: 589.1] | | | $ | [removed: 647.7] [added: 835.8] | | | $ | [removed: 489.8] [added: 647.7] | | | $ | [removed: 413.4] [added: 489.8] | | | $ | [removed: 379.6] [added: 413.4] | |

| Risk Assessment EBITDA | | [removed: 415.5] [added: 458.7] | | | | [removed: 406.5] [added: 415.5] | | | | [removed: 368.8] [added: 406.5] | | | | [removed: 346.9] [added: 368.8] | | | | [removed: 316.3] [added: 346.9] | |

| EBITDA | $ | [removed: 1,251.3] [added: 1,047.8] | | | $ | [removed: 1,054.2] [added: 1,251.3] | | | $ | [removed: 858.6] [added: 1,054.2] | | | $ | [removed: 760.3] [added: 858.6] | | | $ | [removed: 695.9] [added: 760.3] | |

| Depreciation and amortization of fixed and intangible assets from continuing operations | | [removed: 211.6] [added: 237.4] | | | | [removed: 167.0] [added: 211.6] | | | | [removed: 95.5] [added: 167.0] | | | | [removed: 85.4] [added: 95.5] | | | | [removed: 65.8] [added: 85.4] | |

| Interest expense from continuing operations | | [removed: 120.0] [added: 119.4] | | | | [removed: 121.4] [added: 120.0] | | | | [removed: 70.0] [added: 121.4] | | | | [removed: 76.1] [added: 70.0] | | | | [removed: 72.5] [added: 76.1] | |

| Provision for income taxes from continuing operations | | [removed: 202.2] [added: 135.9] | | | | [removed: 196.6] [added: 202.2] | | | | [removed: 208.5] [added: 196.6] | | | | [removed: 184.8] [added: 208.5] | | | | [removed: 162.7] [added: 184.8] | |

| Depreciation, amortization, interest and provision for income taxes from discontinued operations | | [removed: 126.3] [added: —] | | | | [removed: 61.6] [added: 126.3] | | | | [removed: 84.6] [added: 61.6] | | | | [removed: 65.6] [added: 84.6] | | | | [removed: 65.8] [added: 65.6] | |

| Cash and cash equivalents | $ | [removed: 135.1] [added: 142.3] | | | $ | [removed: 138.3] [added: 135.1] | | | $ | [removed: 39.3] [added: 138.3] | | | $ | [removed: 165.8] [added: 39.3] | | | $ | [removed: 89.8] [added: 165.8] | |

| Total assets | $ | [removed: 4,631.2] [added: 6,020.3] | | | $ | [removed: 5,593.7] [added: 4,631.2] | | | $ | [removed: 2,335.1] [added: 5,593.7] | | | $ | [removed: 2,492.8] [added: 2,335.1] | | | $ | [removed: 2,347.3] [added: 2,492.8] | |

| | 2017 | | | | 2016 | | | | 2015 | | | | 2014 | | | | 2013 | | |

| Net income | $ | 555.1 | | | $ | 591.2 | | | $ | 507.6 | | | $ | 400.0 | | | $ | 348.4 | |

| EBITDA | $ | 1,047.8 | | | $ | 1,251.3 | | | $ | 1,054.2 | | | $ | 858.6 | | | $ | 760.3 | |

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

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

| | 2017 | | | | 2016 | | | | 2015 | | | | 2014 | | | | 2013 | | |

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

| | |

| --- | --- |

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

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: Greentech Media, Inc., which was acquired on July 26, 2016, Analyze Re, Inc., which was acquired on October 20, 2016, and the GeoInformation Group Limited, which was acquired] [added: our recent acquisitions in 2017 (See Note 8 of our consolidated financial statements included in this annual report] on [removed: November 11,2016.][added: Form 10-K).]

Management excluded from its assessment the internal control over financial reporting of these acquisitions and collectively represents approximately [removed: 0.2%] [added: 2.0%] of total assets [added: (excluding goodwill] and [removed: 0.3%] [added: intangible assets which were integrated into the Company's systems and control environment) and 1.9%] of revenues as of and for the year ended December 31, [removed: 2016.][added: 2017.]

Based upon the foregoing assessments, our Chief Executive Officer and Chief Financial Officer have concluded that, as of December 31, [removed: 2016,] [added: 2017,] 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: 2016] [added: 2017] 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: 2016] [added: 2017] is set forth in Item 8.

We are in the process of integrating [removed: Greentech Media, Analyze Re and GeoInformation (which we acquired] [added: our recent acquisitions] in [removed: July 2016, October 2016 and November 2016, respectively)] [added: 2017] 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: 2016] [added: 2017] 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: 2016] [added: 2017] (the “Proxy Statement”).

| Verisk Analytics, Inc. Consolidated Financial Statements as of December 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] and for the Years Ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014.] [added: 2015.] | |

| [Management’s Report on Internal Controls Over Financial [removed: Reporting](#s076B24A05F4F55DE836DA6DA30DBE2D9)] [added: Reporting](#sFAF0219AC70C583985AB9589F98D7DCD)] | [removed: [54](#s076B24A05F4F55DE836DA6DA30DBE2D9)] [added: [55](#sFAF0219AC70C583985AB9589F98D7DCD)] |

| [Report of Independent Registered Public Accounting Firm on Internal Controls Over Financial [removed: Reporting](#sECB51EE996D35D2EA6A3050919836E0D)] [added: Reporting](#s0873A3DF8C615C0D97465DCFD23FDCBD)] | [removed: [55](#sECB51EE996D35D2EA6A3050919836E0D)] [added: [56](#s0873A3DF8C615C0D97465DCFD23FDCBD)] |

| [Report of Independent Registered Public Accounting [removed: Firm](#s4463E5C7FF13542FAEB0729B1B04218A)] [added: Firm](#sEDA9ADC6CD46574BA491C5ED9BEF785E)] | [removed: [56](#s4463E5C7FF13542FAEB0729B1B04218A)] [added: [58](#sEDA9ADC6CD46574BA491C5ED9BEF785E)] |

| [Consolidated Balance [removed: Sheets](#s14CA2B28B08B5F09B423769BCD7E066B)] [added: Sheets](#s39E7F60AC45E524AA4348085C3A12CE1)] | [removed: [57](#s14CA2B28B08B5F09B423769BCD7E066B)] [added: [59](#s39E7F60AC45E524AA4348085C3A12CE1)] |

| [Consolidated Statements of [removed: Operations](#s1294B9CB8552503CBD3ED584BB2AD56B)] [added: Operations](#s99A1B8DD05135BF3998211BE25AD53D2)] | [removed: [58](#s1294B9CB8552503CBD3ED584BB2AD56B)] [added: [60](#s99A1B8DD05135BF3998211BE25AD53D2)] |

| [Consolidated Statements of Comprehensive [removed: Income](#sB091D03A253B505E8732600AE8264C0A)] [added: Income](#sD8953054BB745D8790CD0704E792A127)] | [removed: [59](#sB091D03A253B505E8732600AE8264C0A)] [added: [61](#sD8953054BB745D8790CD0704E792A127)] |

| [Consolidated Statements of Changes in Stockholders’ [removed: Equity](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] [added: Equity](#s6BAF48D07D405527920E532F4554B01A)] | [removed: [60](#sB92E3596D4A25FAAAB43A3A5ED4D0DD3)] [added: [62](#s6BAF48D07D405527920E532F4554B01A)] |

| [Consolidated Statements of Cash [removed: Flows](#sB0843B13B3A557E6ABCF42393826BE6E)] [added: Flows](#sD760F7D88D1C586BAAF096B1BBDE81C9)] | [removed: [61](#sB0843B13B3A557E6ABCF42393826BE6E)] [added: [63](#sD760F7D88D1C586BAAF096B1BBDE81C9)] |

| [Notes to Consolidated Financial [removed: Statements](#sC354D685384E5466AE4E8FCCD0E3FC05)] [added: Statements](#s09939ED0FEA758769B53D82CCAACD902)] | [removed: [63](#sC354D685384E5466AE4E8FCCD0E3FC05)] [added: [65](#s09939ED0FEA758769B53D82CCAACD902)] |

| [Schedule II, Valuation and Qualifying Accounts and [removed: Reserves](#s54D5D5CC7D65570FBFCBAA68F9B78429)] [added: Reserves](#sC37B7DAF423B5BBE9ACD7AAB94420B98)] | [removed: [102](#s54D5D5CC7D65570FBFCBAA68F9B78429)] [added: [106](#sC37B7DAF423B5BBE9ACD7AAB94420B98)] |

Based on this assessment, management concluded that our internal control over financial reporting was effective at December 31, [removed: 2016.][added: 2017.]

The excluded financial statements of these acquisitions constitute approximately [removed: 0.2%] [added: 2.0%] of total assets [added: (excluding goodwill] and [removed: 0.3%] [added: intangible assets which were integrated into the Company's systems and control environment) and 1.9%] of revenues collectively included within our consolidated financial statements as of and for the year ended December 31, [removed: 2016.][added: 2017.]

Due to the timing of the acquisitions, management did not assess the [removed: effectivness] [added: effectiveness] of internal control over financial reporting for these acquisitions.

Deloitte & Touche LLP, the independent registered public accounting firm that audited the consolidated financial statements included in this annual report on Form 10-K has also audited the effectiveness of our internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] as stated in their report which is included herein.

To the [added: Stockholders and the] Board of Directors [removed: and Stockholders] of [added: Verisk Analytics, Inc.]

We have audited the internal control over financial reporting of Verisk Analytics, Inc. and subsidiaries (the "Company") as of December 31, [removed: 2016,] [added: 2017,] based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Accordingly, our audit did not include the internal control over financial reporting at [removed: Greentech Media, Inc., Analyze Re, Inc. or] the [removed: GeoInformation Group Limited.][added: 2017 acquired businesses.]

We conducted our audit in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]

A company’s internal control over financial reporting is a process designed [removed: by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of directors, management, and other personnel] to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Also, projections of any evaluation of [removed: the] effectiveness [removed: of the internal control over financial reporting] to future periods are subject to the risk that [removed: the] controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on [removed: the] criteria established in Internal Control - Integrated Framework (2013) issued by [removed: the Committee of Sponsoring Organizations of the Treadway Commission.][added: COSO.]

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States),] [added: States) (PCAOB),] the consolidated financial statements [removed: and financial statement schedule] as of and for the year ended December 31, [removed: 2016] [added: 2017,] of the Company and our report dated February [removed: 21, 2017] [added: 20, 2018,] expressed an unqualified opinion on those financial [removed: statements and financial statement schedule.][added: statements.]

We have audited the accompanying consolidated balance sheets of Verisk Analytics, Inc. and subsidiaries (the "Company") as of December 31, [removed: 2016 and 2015,] [added: 2017] and [added: 2016,] the related consolidated statements of operations, comprehensive income, [removed: changes in] stockholders’ equity, and cash [removed: flows] [added: flows,] for each of the three years in the period ended December 31, [removed: 2016.][added: 2017, and the related notes and the schedule listed in the Index at Item 15 (collectively referred to as the "financial statements").]

These financial statements [removed: and financial statement schedule] are the responsibility of the Company's management.

Our responsibility is to express an opinion on the [added: Company's] financial statements [removed: and financial statement schedule] based on our audits.

We conducted our audits in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material [removed: misstatement.][added: misstatement, whether due to error or fraud.]

[removed: An audit includes] [added: Such procedures included] examining, on a test basis, evidence [removed: supporting] [added: regarding] the amounts and disclosures in the financial statements.

[removed: An audit] [added: Our audits] also [removed: includes assessing] [added: included evaluating] the accounting principles used and significant estimates made by management, as well as evaluating the overall [added: presentation of the] financial [removed: statement presentation.][added: statements.]

In our opinion, [removed: such consolidated] [added: the] financial statements present fairly, in all material respects, the financial position of [removed: Verisk Analytics, Inc. and subsidiaries] [added: the Company] as of December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the results of [removed: their] [added: its] operations and [removed: their] [added: its] cash flows for each of the three years in the period ended December 31, [removed: 2016,] [added: 2017,] 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 [removed: States),] [added: States) (PCAOB),] the [removed: Company’s] [added: Company's] internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on [removed: the] criteria established in Internal Control [removed: ----] [added: -] Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 21, 2017] [added: 20, 2018,] expressed an unqualified opinion on the [removed: Company’s] [added: Company's] internal control over financial reporting.

As of December 31, [removed: 2016] [added: 2017] and [removed: 2015][added: 2016]

| | [added: 2017 | | | |] 2016 | | | | 2015 | | |

| Cash and cash equivalents | $ | [removed: 135.1] [added: 142.3] | | | $ | [removed: 138.3] [added: 135.1] | |

| Available-for-sale securities | | [removed: 3.4] [added: 3.8] | | | | [removed: 3.6] [added: 3.4] | |

| Accounts receivable, net | | [removed: 263.9] [added: 345.5] | | | | [removed: 251.0] [added: 263.9] | |

| Prepaid expenses | | [removed: 28.9] [added: 38.1] | | | | [removed: 34.1] [added: 28.9] | |

| Income taxes receivable | | [removed: 49.3] [added: 28.8] | | | | [removed: 48.6] [added: 49.3] | |

| Other current assets | | [removed: 20.3] [added: 39.1] | | | | [removed: 52.9] [added: 20.3] | |

Management excluded from its assessment the internal control over financial reporting for our acquisitions in 2017 (See Note 8 of our consolidated financial statements included in this annual report on Form 10-K).

Opinion on Internal Control over Financial Reporting

As described in Management’s Report on Internal Controls over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Arium Limited, which was acquired on January 21, 2017, Healix International Holdings Limited, which was acquired on February 16, 2017, Emergent Network Intelligence Limited, which was acquired on February 24, 2017, Fintellix Solutions Private Limited, which was acquired on March 31, 2017, MAKE Consulting A/S, which was acquired on May 19, 2017, Aerial Imagery group of companies, which were acquired during the three months ended June 30, 2017, G2 Web Services LLC, which was acquired on August 3, 2017, Sequel Business Solutions Ltd., which was acquired on August 23, 2017, Lundquist Consulting, Inc., which was acquired on August 31, 2017, Rebmark Legal Solutions Ltd., which was acquired on November 9, 2017, Service Software, LLC., which was acquired on December 22, 2017 and PowerAdvocate, Inc., which was acquired on December 29, 2017 (collectively the “2017 acquired businesses”).

The financial statements of the 2017 acquired businesses constitute 2.0% of total assets (excluding goodwill and intangible assets which were integrated into the Company's systems and control environment) and 1.9% of revenues collectively of the consolidated financial statement amounts as of and for the year ended December 31, 2017.

Basis for Opinion

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Definition and Limitations of Internal Control over Financial Reporting

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

February 20, 2018

To the Stockholders and the Board of Directors of Verisk Analytics, Inc.

Opinion on the Financial Statements

Basis for Opinion

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

February 20, 2018

We have served as the Company's auditor since 2001.

| | 2017 | | | | 2016 | | |

| Income taxes payable | | 3.1 | | | | — | |

For The Years Ended December 31, 2017, 2016 and 2015

| Net income | $ | 555.1 | | | $ | 591.2 | | | $ | 507.6 | |

For The Years Ended December 31, 2017, 2016 and 2015

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

| Treasury stock acquired (3,356,360 shares) | — | | | | — | | | | — | | | | — | | | | (269.8 | ) | | | — | | | | — | | | | (269.8 | ) |

| Stock options exercised (1,125,004 shares reissued from treasury stock) | — | | | | — | | | | — | | | | 28.7 | | | | 9.2 | | | | — | | | | — | | | | 37.9 | |

| Restricted stock lapsed (143,557 shares reissued from treasury stock) | — | | | | — | | | | — | | | | (1.1 | ) | | | 1.1 | | | | — | | | | — | | | | — | |

| Balance, December 31, 2017 | 544,003,038 | | | $ | 0.1 | | | $ | — | | | $ | 2,180.1 | | | $ | (3,150.5 | ) | | $ | 3,308.0 | | | $ | (412.3 | ) | | $ | 1,925.4 | |

For The Years Ended December 31, 2017, 2016 and 2015

| Net income | $ | 555.1 | | | $ | 591.2 | | | $ | 507.6 | |

For The Years Ended December 31, 2017, 2016 and 2015

Verisk Analytics, Inc. and its consolidated subsidiaries (“Verisk” or the “Company”) is a data analytics provider serving customers in insurance, energy and specialized markets, and financial services.

Using various technologies to collect and analyze billions of records, Verisk draws on numerous data assets and domain expertise to provide first-to-market innovations that are integrated into customer workflows.

Around the world, Verisk helps customers protect people, property, and financial assets.

Certain reclassifications have been made to assets and liabilities for pension and postretirement benefits and cash flows from investing activities within the consolidated financial statements and in the notes to conform to the respective 2017 presentation.

The Company adopted Accounting Standards Update (“ASU”) No. 2016-09, Improvements to Employee Share-Based Payment Accounting (“ASU No. 2016-09”) on January 1, 2017.

Excess tax benefit from exercised stock options is recorded as an income tax benefit in the accompanying consolidated statements of operations.

liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

Topic 606 replaces numerous requirements in U.S. GAAP, including industry-specific requirements, and provides companies with a single revenue recognition model for recognizing revenue from contracts with customers.

The core principle of Topic 606 is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services.

The two permitted transition methods under Topic 606 are the full retrospective method, in which case the standard would be applied to each prior reporting period presented and the cumulative effect of applying the standard would be recognized at the earliest period shown, or the modified retrospective method, in which case the cumulative effect of applying the standard would be recognized at the date of initial application.

In July 2015, the FASB approved the deferral of Topic 606's effective date by one year.

Management excluded from its assessment the internal control over financial reporting at Greentech Media, Inc., which was acquired on July 26, 2016, Analyze Re, Inc., which was acquired on October 20, 2016, and the GeoInformation Group Limited, which was acquired on November 11, 2016.

Jersey City, New Jersey

As described in Management’s Report on Internal Controls over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Greentech Media, Inc., which was acquired on July 26, 2016, Analyze Re, Inc., which was acquired on October 20, 2016, and the GeoInformation Group Limited, which was acquired on November 11,2016.

The financial statements of these acquisitions constitute 0.2% of total assets and 0.3% of revenues collectively of the consolidated financial statements of the Company as of and for the year ended December 31, 2016.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis.

February 21, 2017

Our audits also included the financial statement schedule listed in the Index at Item 15.

Also, in our opinion, such financial statement schedule, when considered in relation to the basic consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

| | | | | | | | |

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

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

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

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

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

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

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

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

| Balance, January 1, 2014 | 544,003,038 | | | $ | 0.1 | | | $ | (0.3 | ) | | $ | 1,202.1 | | | $ | (1,864.9 | ) | | $ | 1,254.1 | | | $ | (43.5 | ) | | $ | 547.6 | |

| Treasury stock acquired (10,802,087 shares) | — | | | | — | | | | — | | | | (100.0 | ) | | | (675.4 | ) | | | — | | | | — | | | | (775.4 | ) |

| KSOP shares earned | — | | | | — | | | | 0.1 | | | | 15.2 | | | | — | | | | — | | | | — | | | | 15.3 | |

| Stock options exercised, including tax benefit of $15.4 (1,091,746 shares reissued from treasury stock) | — | | | | — | | | | — | | | | 34.0 | | | | 5.8 | | | | — | | | | — | | | | 39.8 | |

| Restricted stock lapsed, including tax benefit of $0.5 (134,713 shares reissued from treasury stock) | — | | | | — | | | | — | | | | (0.2 | ) | | | 0.7 | | | | — | | | | — | | | | 0.5 | |

| Excess tax benefits from exercised stock options | | (31.4 | ) | | | (40.1 | ) | | | (22.6 | ) |

| Purchase of non-controlling equity investments in non-public companies | | — | | | | (0.1 | ) | | | (5.0 | ) |

| Sale of non-controlling equity investments in non-public companies | | 8.5 | | | | — | | | | — | |

| Excess tax benefits from exercised stock options | | 31.4 | | | | 40.1 | | | | 22.6 | |

Verisk Analytics, Inc. and its consolidated subsidiaries (“Verisk” or the “Company”) enable risk-bearing businesses to better understand and manage their risks.

The Company provides its customers proprietary data that, combined with analytic methods, create embedded decision support solutions.

The Company is one of the largest aggregators and providers of data pertaining to property and casualty (“P&C”) insurance risks in the United States of America (“U.S.”).

The mortgage services business was sold on March 11, 2014.

(f) Investments

The Company’s investments at December 31, 2016 and 2015 included registered investment companies and equity investments in non-public companies.

The Company accounts for short-term investments in accordance with ASC 320, Investments-Debt and Equity Securities (“ASC 320”).

There were no investments classified as trading securities at December 31, 2016 or 2015.

All investments with readily determinable market values are classified as available-for-sale.

While these investments are not held with the specific intention to sell them, they may be sold to support the Company’s investment strategies.

All available-for-sale investments are carried at fair value.

The cost of all available-for-sale investments sold is based on the specific

identification method, with the exception of mutual fund-based investments, which is based on the weighted average cost method.

Dividend income is accrued on the ex-dividend date.