Verisk Analytics Pricing Spineometer: 3 of 5 Vertebrae

Verisk , a data, analytics, and technology provider to the insurance industry, had a positive FY 2024. Revenue from continuing operations rose 7.5% to $2.9 billion, and operating profit rose 10.8% to $1.3 billion over the last year.

A review of Verisk’s 26 February 2025 earnings call and associated financial reports provided insight regarding the importance of pricing on performance.

LEARNINGS FROM EARNINGS CALL AND FINANCIAL REPORT

Lee Shavel, CEO of Verisk, spoke many times about the importance of value-based pricing for driving financial performance.  His comments include:

• “[W]e introduced pricing optimization strategies and tools to drive a more value-based conversation with clients.” 
• “Specifically, in our Extreme Events business, where we recently introduced our global suite of next-generation models, we benefited from this new client-centric approach as we are capturing strong value-based pricing realization and extending duration in contract renewals.”
• “[O]ur pricing and bundling strategy is driving solid growth in our anti-fraud business.”
• “[F]ocusing on delivering more value and then also communicating and orienting our sales efforts around that value orientation.”
• “So across the business, that value-driven pricing impact has been one of the key elements of the strength that we're seeing in subscription. And those aren't one-time effects. I think that that has been an overall structural and philosophical change in terms of how we approach pricing, that we expect to continue to drive results for us in 2025 and beyond.”

These CEO remarks of Lee Shavel demonstrate Verisk is focused on having a strong pricing capability, which would include both professionals and technology. 

IMPLIED PRICING CAPABILITY NEEDS

Among the 7,800 employees of Verisk, industry benchmarks suggest 6 to 30 professionals focused on pricing.  Due to the complexity and dynamics of their market, we would expect Verisk to be at the upper end of this range. 

1. Verisk sells a broad range of offerings. For underwriting insurance, Verisk offers (1) Forms, rules and Loss Costs, (2) Underwriting Data and Analytics Solutions, (3) Extreme Event Solutions, (4) Life Insurance Solutions, (5) Specialty Business Solutions, (6) Marketing Solutions, and (7) International Underwriting Solutions.  For claims, Verisk offers (1) Property Estimating Solutions, (2) Anti-Fraud Solutions, Casualty Solutions, and (3) International Claims Solutions.  Best practices require pricing teams to manage high offering complexity and complexity within each offering.  These teams would define appropriate price structures and metrics and set the pricing of those metrics in proportion to value delivered, informed by competitive alternatives.
2. Verisk serves a dominant share of insurance and reinsurance companies across the United States and the world.  Pricing professionals are experts in price segmenting markets and using that segmentation for price structuring and setting.
3. Verisk invests continually in new solution offerings.  Pricing experts are necessary for pricing new offerings and evaluating the value of potential offerings before they enter the product development lifecycle. 
4. Verisk assigns accounts as Tier 1, 2, or 3 and engages Managing Directors, Account Executives, Account Managers, and Subject Matter Experts in the sales cycle.  To support this sales-focused team in their negotiations and account management, pricing professionals should define price guardrails (high, expected, and low price for each sale) and work to develop account management goals related to mix and price capture variance between accounts.  (See Smith, Margin Variance Analysis for Informing Customer Engagement Strategy.)
5. Many factors create business risk, including the revolution in generative AI, regulatory shifts, and general economic conditions.  Other factors create an opportunity for growth, such as Verisk’s engagement in acquisitions.  Research has demonstrated that industries going through rapid changes benefit from greater pricing due diligence to prevent unnecessary and costly errors as well as to seize underappreciated opportunities. 
6. A majority of Verisk’s business is in the United States, with some activity in the United Kingdom. As such, we would expect the majority of pricing professionals at Verisk to be in the States.

Research into the investment by Verisk Analytics in pricing was rather challenging.

1. A significant team of pricing analysts based in Krakow, Poland, exists, yet it appears they are not working on pricing Verisk’s offering but rather on providing insurance pricing guidance to Verisk’s customers. 
2. Many executives work on revenue management at Verisk, but it appears this term implies sales and account management, where price and value discussions are a part of their responsibility, rather than price structuring, setting, and capturing itself is the focus. 
3. A retired vice president of pricing and strategy was identified, but no current team was identified.
4. No openings within the pricing function at Verisk were found on their job board, distinct from the Krakow team providing pricing guidance to Verisk’s customers rather than pricing guidance to Verisk itself.

Verisk declined to comment for this article. 

Given the importance and capability of pricing at Verisk Analytics as indicated in financial reports, management statements, and our pricing team research, and given their performance, we have come to the following conclusion as of April 2025.

Verisk Analytics Pricing Spineometer: 3 out of 5 Vertebrae.

Value-based pricing and selling is the CEO driven strategy at Verisk, and management reports investment in pricing capability, yet I could not identify who is executing this strategy.  Is pricing a product, finance, or sales responsibility?  While it would be easy to say “yes, all of the above”, anything that is everybody’s responsibility quickly becomes no one’s responsibility.  Verisk requires a team to coordinate and drive this strategy to implement the CEO’s mandate.  I often give a company where I could not find a pricing team within industry benchmarks a 2 of 5, yet the CEO's clear mandate is interpreted to imply that pricing capability is a work in progress at Verisk.

VRSK (Verisk Analytics, Inc.) was relatively unchanged at 299 the day prior to their earnings call and one week later. FY 2024 revenue of $2.88 billion with a 43.5% operating margin and P/E ratio near 40. 

For FY 2024, a 1% improvement in price would yield a 2.3% improvement in operating profits, holding all else constant at Verisk Analytics.

SIGNY by Wiglaf Pricing, an AI tool for multi-SKU businesses to predict and manage price capture, has launched. Contact me at tsmith@wiglafpricing.com