Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No x

As of July ~~27, 2012,~~26, 2013, there was the following number of shares outstanding of each of the issuer’s classes of common stock:


		2012							2013
		unaudited			2011				(unaudited)			2012
		(In thousands, except for share and per share data)							(In thousands, except for share and per share data)
ASSETS	ASSETS							ASSETS
Current assets:
Cash and cash equivalents		$	97,198		$	191,603			$	172,587		$	89,819
Available-for-sale securities			4,782			5,066				4,254			4,883
Accounts receivable, net of allowance for doubtful accounts as of June 30, 2012 and December 31, 2011 of $4,088 and $4,158, respectively			173,607			153,339
Accounts receivable, net of allowance for doubtful accounts of $4,936 and $4,753, respectively										186,549			178,430
Prepaid expenses			28,492			21,905				31,048			21,946
Deferred income taxes, net			15,613			3,818				10,463			10,397
Federal and foreign income taxes receivable			27,705			25,242
State and local income taxes receivable			3,638			11,433
Income taxes receivable										54,013			45,975
Other current assets			46,460			41,248				34,695			39,109

Total current assets			397,495			453,654				493,609			390,559

Noncurrent assets:
Fixed assets, net			133,731			119,411				185,928			154,084
Intangible assets, net			363,555			226,424				486,532			520,935
Goodwill			934,762			709,944				1,249,271			1,247,459
Deferred income taxes, net			—			10,480
Other assets			23,800			21,193				24,011			47,299

Total assets		$	1,853,343		$	1,541,106			$	2,439,351		$	2,360,336

LIABILITIES AND STOCKHOLDERS’ EQUITY/(DEFICIT)
LIABILITIES AND STOCKHOLDERS’ EQUITY								LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities		$	153,684		$	162,992			$	157,961		$	187,648
Acquisition related liabilities			—			250
Short-term debt and current portion of long-term debt			201,783			5,554				137,870			195,263
Pension and postretirement benefits, current			2,912			4,012				1,734			1,734
Fees received in advance			253,880			176,842				287,571			200,705

Total current liabilities			612,259			349,650				585,136			585,350

Noncurrent liabilities:
Long-term debt			1,054,395			1,100,332				1,266,910			1,266,162
Pension benefits			24,997			109,161				32,138			38,655
Postretirement benefits			10,624			18,587				2,267			2,627
Deferred income taxes, net			41,880			—				135,257			133,761
Other liabilities			62,506			61,866				52,138			78,190

Total liabilities			1,806,661			1,639,596				2,073,846			2,104,745

Commitments and contingencies
Stockholders’ equity/(deficit):
Common stock, $.001 par value; 1,200,000,000 shares authorized; 544,003,038 shares issued and 165,721,412 and 164,285,227 outstanding as of June 30, 2012 and December 31, 2011, respectively			137			137
Stockholders’ equity:
Class A common stock, $.001 par value; 1,200,000,000 shares authorized; 544,003,038 shares issued and 167,629,024 and 167,727,073 outstanding, respectively										137			137
Unearned KSOP contributions			(591	)		(691	)			(402	)		(483	)
Additional paid-in capital			963,052			874,808				1,116,948			1,044,746
Treasury stock, at cost, 378,281,626 and 379,717,811 shares as of June 30, 2012 and December 31, 2011, respectively			(1,563,079	)		(1,471,042	)
Treasury stock, at cost, 376,374,014 and 376,275,965 shares, respectively										(1,733,283	)		(1,605,376	)
Retained earnings			724,517			576,585				1,070,443			905,727
Accumulated other comprehensive losses			(77,354	)		(78,287	)			(88,338	)		(89,160	)

Total stockholders’ equity/(deficit)			46,682			(98,490	)
Total stockholders’ equity										365,505			255,591

Total liabilities and stockholders’ equity/(deficit)		$	1,853,343		$	1,541,106
Total liabilities and stockholders’ equity									$	2,439,351		$	2,360,336

The accompanying notes are an integral part of these condensed consolidated financial statements.


	Three Months Ended June 30,						Six Months Ended June 30,						Three Months Ended June 30,						Six Months Ended June 30,
	2012			2011			2012			2011			2013			2012			2013			2012
	(In thousands)												(In thousands)
Net income	$	73,331		$	65,577		$	147,932		$	131,453		$	84,205		$	73,331		$	164,716		$	147,932

Other comprehensive income, net of tax:
Unrealized holding loss on investments		(116	)		(126	)		(313	)		(252	)
Unrealized foreign currency (loss)/gain		(287	)		235			(134	)		573
Unrealized foreign currency loss														(275	)		(287	)		(681	)		(134	)
Unrealized holding loss on available-for-sale securities														(84	)		(116	)		(314	)		(313	)
Pension and postretirement unfunded liability adjustment		452			1,220			1,380			1,974			948			452			1,817			1,380

Total other comprehensive income		49			1,329			933			2,295			589			49			822			933

Comprehensive income	$	73,380		$	66,906		$	148,865		$	133,748		$	84,794		$	73,380		$	165,538		$	148,865

The accompanying notes are an integral part of these condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ ~~EQUITY/~~EQUITY (DEFICIT) (UNAUDITED)

For The Year Ended December 31, ~~2011~~2012 and The Six Months Ended June 30, ~~2012~~2013


	��																				Accumulated						Class A Common Stock		Par Value		Unearned KSOP Contributions			Additional Paid-in Capital		Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Losses			Total Stockholders’ Equity (Deficit)
											Unearned			Additional							Other			Total			(In thousands, except for share data)
	Common Stock Issued										KSOP			Paid-in		Treasury			Retained		Comprehensive			Stockholders’
	Class A		Class B (Series 1)			Class B (Series 2)			Par Value		Contributions			Capital		Stock			Earnings		Losses			Equity/(Deficit)
	(In thousands, except for share data)
Balance, December 31, 2010		150,179,126		198,327,962			193,665,008		$	135	$	(988	)	$	754,708	$	(1,106,321	)	$	293,827	$	(55,803	)	$	(114,442	)
Balance, December 31, 2011																												544,003,038	$	137	$	(691	)	$	874,808	$	(1,471,042	)	$	576,585	$	(78,287	)	$	(98,490	)
Net income		—		—			—			—		—			—		—			282,758		—			282,758			—		—		—			—		—			329,142		—			329,142
Other comprehensive loss		—		—			—			—		—			—		—			—		(22,484	)		(22,484	)		—		—		—			—		—			—		(10,873	)		(10,873	)
Conversion of Class B (Series 1) common stock		198,327,962		(198,327,962	)		—			—		—			—		—			—		—			—
Conversion of Class B (Series 2) common stock		193,665,008		—			(193,665,008	)		—		—			—		—			—		—			—
Treasury stock acquired—Class A (11,326,624 shares)		—		—			—			—		—			—		(380,710	)		—		—			(380,710	)
Treasury stock acquired (3,491,591 shares)																												—		—		—			—		(162,586	)		—		—			(162,586	)
KSOP shares earned		—		—			—			—		297			12,318		—			—		—			12,615			—		—		208			12,903		—			—		—			13,111
Stock options exercised, including tax benefit of $57,684 (3,716,165 shares reissued from treasury stock)		1,830,942		—			—			2		—			85,051		15,978			—		—			101,031
Stock options exercised, including tax benefit of $88,185 (6,880,678 shares reissued from treasury stock)																												—		—		—			131,824		28,039			—		—			159,863
Restricted stock lapsed, including tax benefit of $202 (41,908 shares reissued from treasury stock)																												—		—		—			34		167			—		—			201
Employee stock purchase plan (6,074 shares issued from treasury stock)																												—		—		—			268		26			—		—			294
Stock based compensation		—		—			—			—		—			22,656		—			—		—			22,656			—		—		—			24,696		—			—		—			24,696
Other stock issuances		—		—			—			—		—			75		11			—		—			86
Other stock issuances (4,777 shares reissued from treasury stock)																												—		—		—			213		20			—		—			233

Balance, December 31, 2011		544,003,038		—			—			137		(691	)		874,808		(1,471,042	)		576,585		(78,287	)		(98,490	)

Balance, December 31, 2012																												544,003,038		137		(483	)		1,044,746		(1,605,376	)		905,727		(89,160	)		255,591
Net income		—		—			—			—		—			—		—			147,932		—			147,932			—		—		—			—		—			164,716		—			164,716
Other comprehensive income		—		—			—			—		—			—		—			—		933			933			—		—		—			—		—			—		822			822
Treasury stock acquired—Class A (2,351,655 shares)		—		—			—			—		—			—		(107,041	)		—		—			(107,041	)
Treasury stock acquired (2,326,130 shares)																												—		—		—			—		(137,634	)		—		—			(137,634	)
KSOP shares earned		—		—			—			—		100			6,086		—			—		—			6,186			—		—		81			7,276		—			—		—			7,357
Stock options exercised, including tax benefit of $49,974 (3,787,840 shares reissued from treasury stock)		—		—			—			—		—			68,505		15,004			—		—			83,509
Stock options exercised, including tax benefit of $31,242 (2,075,394 shares reissued from treasury stock)																												—		—		—			52,759		9,062			—		—			61,821
Restricted stock lapsed, including tax benefit of $969 (136,940 shares reissued from treasury stock)																												—		—		—			375		594			—		—			969
Employee stock purchase plan (15,173 shares issued from treasury stock)																												—		—		—			805		68			—		—			873
Stock based compensation		—		—			—			—		—			13,653		—			—		—			13,653			—		—		—			10,955		—			—		—			10,955
Other stock issuances (574 shares reissued from treasury stock)																												—		—		—			32		3			—		—			35

Balance, June 30, 2012		544,003,038		—			—		$	137	$	(591	)	$	963,052	$	(1,563,079	)	$	724,517	$	(77,354	)	$	46,682
Balance, June 30, 2013																												544,003,038	$	137	$	(402	)	$	1,116,948	$	(1,733,283	)	$	1,070,443	$	(88,338	)	$	365,505

The accompanying notes are an integral part of these condensed consolidated financial statements.


	2012			2011			2013			2012
	(In thousands)						(In thousands)
Cash flows from operating activities:
Net income	$	147,932		$	131,453		$	164,716		$	147,932
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of fixed assets		24,734			22,160			32,025			24,734
Amortization of intangible assets		20,774			17,332			34,403			20,774
Amortization of debt issuance costs and original issue discount		1,096			754			1,368			1,096
Allowance for doubtful accounts		461			557			633			461
KSOP compensation expense		6,186			6,408			7,357			6,186
Stock based compensation		13,653			12,331			10,955			13,653
Noncash charges associated with performance-based appreciation awards		—			583
Acquisition related liabilities adjustment		—			(3,364	)
Realized gain on securities, net		(300	)		(487	)
Realized loss (gain) on available-for-sale securities, net								100			(300	)
Deferred income taxes		(535	)		1,660			1,007			(535	)
Loss on disposal of assets		21			221
Loss on disposal of fixed assets								428			21
Excess tax benefits from exercised stock options		(31,624	)		(5,470	)		(63,934	)		(31,624	)
Other operating		(18	)		30
Other operating activities, net								28			(18	)
Changes in assets and liabilities, net of effects from acquisitions:
Accounts receivable		(13,652	)		(16,979	)		(8,752	)		(13,652	)
Prepaid expenses and other assets		4,289			(8,082	)		(1,696	)		4,289
Federal and foreign income taxes		51,957			7,703
State and local income taxes		7,972			(140	)
Income taxes								24,171			59,929
Accounts payable and accrued liabilities		(24,124	)		(15,190	)		(12,833	)		(24,124	)
Fees received in advance		77,038			50,520			86,866			77,038
Pension and postretirement benefits		(90,808	)		(9,747	)		(4,099	)		(90,808	)
Other liabilities		(7,617	)		(5,166	)		(26,052	)		(7,617	)

Net cash provided by operating activities		187,435			187,087			246,691			187,435

Cash flows from investing activities:
Acquisitions, net of cash acquired for 2012 and 2011 of $29,387 and $590, respectively		(331,330	)		(121,721	)
Purchase of non-controlling equity investment in non-public companies		(2,000	)		—
Acquisitions, net of cash acquired of $0 and $29,387, respectively								(983	)		(331,330	)
Purchase of non-controlling interest in non-public companies								—			(2,000	)
Earnout payments		(250	)		(3,500	)		—			(250	)
Proceeds from release of acquisition related escrows								192			—
Escrow funding associated with acquisitions		(17,000	)		(19,560	)		—			(17,000	)
Purchases of fixed assets		(36,532	)		(28,171	)		(63,505	)		(36,532	)
Purchases of available-for-sale securities		(1,128	)		(1,338	)		(4,967	)		(1,128	)
Proceeds from sales and maturities of available-for-sale securities		1,203			1,704			5,826			1,203
Other investing activities, net								439			—

Net cash used in investing activities		(387,037	)		(172,586	)		(62,998	)		(387,037	)

Cash flows from financing activities:
Proceeds from issuance of long-term debt, net of original issue discount		—			448,956
Repayment of current portion of long-term debt		—			(50,000	)		(45,000	)		—
Repayment of short-term debt refinanced on a long-term basis		—			(295,000	)
Proceeds/(repayments) of short-term debt, net		150,000			72,919
Payment of debt issuance costs		—			(4,434	)
Repurchase of Class A common stock		(106,305	)		(214,021	)
(Repayment) proceeds of short-term debt, net								(10,000	)		150,000
Excess tax benefits from exercised stock options								63,934			31,624
Repurchase of common stock								(135,595	)		(106,305	)
Proceeds from stock options exercised		33,453			18,032			30,528			33,453
Excess tax benefits from exercised stock options		31,624			5,470
Other financing, net		(3,441	)		—
Other financing activities, net								(4,111	)		(3,441	)

Net cash provided by/(used in) financing activities		105,331			(18,078	)
Net cash (used in) provided by financing activities								(100,244	)		105,331

Effect of exchange rate changes		(134	)		573			(681	)		(134	)

Decrease in cash and cash equivalents		(94,405	)		(3,004	)
Increase (decrease) in cash and cash equivalents								82,768			(94,405	)
Cash and cash equivalents, beginning of period		191,603			54,974			89,819			191,603

Cash and cash equivalents, end of period	$	97,198		$	51,970		$	172,587		$	97,198

Supplemental disclosures:
Taxes paid	$	37,736		$	80,924		$	71,029		$	37,736

Interest paid	$	26,619		$	17,997		$	39,029		$	26,619

Noncash investing and financing activities:
Repurchase of Class A common stock included in accounts payable and accrued liabilities	$	1,936		$	5,292
Repurchase of common stock included in accounts payable and accrued liabilities							$	3,550		$	1,936

Deferred tax liability established on date of acquisition	$	40,358		$	1,280
Deferred tax asset (liability) established on date of acquisition							$	343		$	(40,358	)

Capital lease obligations	$	3,043		$	8,013		$	2,106		$	3,043

Capital expenditures included in accounts payable and accrued liabilities	$	1,864		$	307		$	3,426		$	1,864

The accompanying notes are an integral part of these condensed consolidated financial statements.

(Amounts in thousands, except for share and per share data, unless otherwise stated)

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 Company offers solutions for detecting fraud in the U.S. P&C insurance, ~~mortgage~~financial services, and healthcare industries and sophisticated methods to predict and quantify loss in diverse contexts ranging from natural catastrophes to supply chain to health insurance. The Company provides solutions, including data, statistical models or tailored analytics, all designed to allow clients to make more logical decisions.

Verisk was established to serve as the parent holding company of Insurance Services Office, Inc. (“ISO”). ISO was formed in 1971 as an advisory and rating organization for the P&C insurance industry to provide statistical and actuarial services, to develop insurance programs and to assist insurance companies in meeting state regulatory requirements. Over the past decade, the Company has broadened its data assets, entered new markets, placed a greater emphasis on analytics, and pursued strategic acquisitions. Verisk’s ~~Class A~~ common stock trades under the ticker symbol “VRSK” on the NASDAQ Global Select Market.

The accompanying unaudited condensed consolidated financial statements have been prepared on the basis of accounting principles generally accepted in the U.S. (“U.S. GAAP”). The preparation of financial statements in conformity with these accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates include acquisition purchase price allocations, the fair value of goodwill, the realization of deferred tax assets, ~~and liabilities, acquisition related liabilities,~~ fair value of stock based compensation, liabilities for pension and postretirement benefits, and the estimate for the allowance for doubtful accounts. Actual results may ultimately differ from those estimates. Certain ~~reclassifications~~combinations have been made related to federal and state income taxes and to the segment reporting within ~~Decision Analytics’~~ revenue categories in ~~the notes to~~ the condensed consolidated financial statements and the notes to conform to the respective ~~2012~~2013 presentation.

The condensed consolidated financial statements as of June 30, ~~2012~~2013 and for the three and six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, in the opinion of management, include all adjustments, consisting of normal recurring accruals, to present fairly the Company’s financial position, results of operations and cash flows. The operating results for the three and six months ended June 30, ~~2012~~2013 are not necessarily indicative of the results to be expected for the full year. The condensed consolidated financial statements and related notes for the three and six months ended June 30, ~~2012~~2013 have been prepared on the same basis as and should be read in conjunction with the annual report on Form 10-K for the year ended December 31, ~~2011.~~2012. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules of the Securities and Exchange Commission (“SEC”). The Company believes the disclosures made are adequate to keep the information presented from being misleading.

In ~~June 2011,~~February 2013, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. ~~2011-05,~~2013-02,~~Presentation~~Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (“(“ASU No. ~~2011-05”~~2013-02”). Under ASU No. 2011-05, an entity has the option to present the total of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices,2013-02, an entity is required to ~~present each component~~provide information about the

amounts reclassified out of ~~net income along with total net income, each component of~~accumulated other comprehensive income ~~along with a total for other comprehensive~~by component, either on the face of the financial statement where net income ~~and a total amount for comprehensive income.~~is presented or in the notes thereto. ASU No. ~~2011-05~~2013-02 is effective prospectively for reporting periods beginning after December 15, 2012. ASU 2013-02 was adopted by the Company on January 1, ~~2012~~2013. The Company elected to present the information as a separate disclosure in the notes to the condensed consolidated financial statements. Refer to Note 9 for further discussion.

In February 2013, the FASB issued ASU No. 2013-04,Obligations Resulting from Joint and ~~did~~Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date(“ASU No. 2013-04”). Under ASU No. 2013-04, an entity is required to measure and disclose the amounts and nature of obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. ASU No. 2013-04 is effective for fiscal years, and interim reporting periods within those years, beginning after December 15, 2013. Early adoption is permitted. The Company has elected not to early adopt. The adoption of ASU 2013-04 will not have a material impact on the Company’s condensed consolidated financial statements as the long-term debt resulting from joint and several liability arrangements has been measured on a gross basis and disclosed in Note 8. Other obligations resulting from joint and several liability arrangements, such as contingencies, retirement benefits and income taxes, are excluded from the scope of this ASU.

In March 2013, the FASB issued ASU No. 2013-05,Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity(“ASU No. 2013-05”). Under ASU No. 2013-05, an entity is required to release any related cumulative translation adjustment into net income upon cessation to have a controlling financial interest in a subsidiary or group of assets within a foreign entity. ASU 2013-05 is effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2013. Early adoption is permitted. The Company has elected not to early adopt. The adoption of ASU 2013-05 is not expected to have a material impact on the Company’s condensed consolidated financial statements.

~~The following is a summary~~Available-for-sale securities consisted of ~~available-for-sale securities:~~the following:

In addition to the available-for-sale securities above, the Company has equity investments in non-public companies in which the Company acquired non-controlling interests and for which no readily determinable market value exists. These securities were accounted for under the cost method in accordance with Accounting Standards Codification (“ASC”) 323-10-25,The Equity Method of Accounting for Investments in Common Stock. At June 30, ~~2012~~2013 and December 31, ~~2011,~~2012, the carrying value of such securities was ~~$5,443~~$3,737 and ~~$3,443,~~$5,015, respectively, and has been included in “Other assets” in the accompanying condensed consolidated balance sheets.

Certain assets and liabilities of the Company are reported at fair value in the accompanying condensed consolidated balance sheets. Such assets and liabilities include amounts for both financial and non-financial instruments. To increase consistency and comparability of assets and liabilities recorded at fair value, ASC 820-10,Fair Value Measurements (“(“ASC 820-10”) ~~establishes~~, established a three-level fair value hierarchy to prioritize the inputs to valuation techniques used to measure fair value. ASC 820-10 requires disclosures detailing the extent to which companies measure assets and liabilities at fair value, the methods and assumptions used to measure fair value and the effect of fair value measurements on earnings. In accordance with ASC 820-10, the Company applied the following fair value hierarchy:

The following table provides information for such assets and liabilities as of June 30, ~~2012~~2013 and December 31, ~~2011.~~2012. The fair values of cash and cash equivalents (other than money-market funds, which are recorded on a reported net asset value basis disclosed below), accounts receivable, accounts payable and accrued liabilities, acquisition related liabilities prior to the adoption of ASC 805,Business Combinations(“ASC 805”), short-term debt, and short-term debt expected to be refinanced approximate their carrying amounts because of the short-term ~~maturity~~nature of these instruments.

The ~~short-term~~Company has not elected to carry its long-term debt ~~would be a Level 2 liability if it was measured~~ at fair value. The carrying value onof the ~~condensed consolidated balance sheets.~~long-term debt represents amortized cost. The Company assesses the fair value of ~~the Company’s~~its long-term debt was estimated at $1,209,082 and $1,181,788 as of June 30, 2012 and December 31, 2011, respectively, and would be a Level 2 liability if the long-term debt was measured at fair value on the condensed consolidated balance sheets. The long-term debt is based on quoted market prices if available, and if not, an estimate of interest rates available to the Company for debt with similar features, the Company’s current credit rating and spreads applicable to the Company. ~~These assets~~The fair value of the long-term debt would be a Level 2 liability if the long-term debt was measured at fair value on the condensed consolidated balance sheets. The following table summarizes the carrying value and ~~liabilities are not presented in~~estimated fair value of the ~~following table.~~long-term debt as of June 30, 2013 and December 31, 2012, respectively:

On December 20, 2012, the Company acquired the net assets of Insurance Risk Management Solutions (“IRMS”). IRMS provided integrated property risk assessment technology underlying one of the Company’s geographic information system (“GIS”) underwriting solutions. At the end of 2012, the long-term contract with IRMS was expiring and precipitated a change in the business relationship. Instead of continuing forward with a new service agreement, the Company acquired IRMS as this will enable the Company to better manage, enhance and continue to use the solutions as part of its Risk Assessment segment. The Company paid a net cash purchase price of $26,422 and funded $1,000 of indemnity escrows.

On August 31, 2012, the Company acquired Argus Information & Advisory Services, LLC (“Argus”), a provider of information, competitive benchmarking, scoring solutions, analytics, and customized services to financial institutions and regulators in North America, Latin America, and Europe, for a net cash purchase price of approximately $404,995 and funded $20,000 of indemnity escrows. Argus leverages its comprehensive payment data sets and provides proprietary solutions to a client base that includes credit and debit card issuers, retail banks and other consumer financial services providers, payment processors, insurance companies, and other industry stakeholders. Within the Company’s Decision Analytics segment, this acquisition enhances the Company’s position as a provider of data, analytics, and decision-support solutions to financial institutions globally.

On March 30, 2012, the Company acquired 100% of the stock of MediConnect Global, Inc. (“MediConnect”), a service provider of medical record retrieval, digitization, coding, extraction, and analysis, for a net cash purchase price of approximately ~~$331,330~~$331,405 and funded $17,000 of indemnity escrows. Within the Company’s Decision Analytics segment, MediConnect further supports the Company’s objective as the leading provider of data, analytics, and decision-support solutions to the healthcare and property casualty industry.

The preliminary ~~purchase price allocation of the acquisition resulted in the following:~~

~~The amounts assigned to intangible assets by type for the current year acquisition are summarized in the table below:~~

~~The~~ allocations of the purchase ~~price (noted within the tables above)~~prices for IRMS, Argus and ALP as disclosed as of December 31, 2012 are all subject to revisions as additional information is obtained about the facts and circumstances that existed as of the acquisition ~~date.~~dates. The revisions may have an impact on the condensed consolidated financial statements. The allocations of the purchase ~~price~~prices will be finalized once all information is obtained, but not to exceed one year from the acquisition ~~date.~~

The goodwill associated with MediConnect is not deductible for tax purposes. For the three and six months ended June 30, 2012, the Company incurred transaction costs related to this acquisition of $17 and $827, respectively, included within “Selling, general and administrative” expenses in the accompanying condensed consolidated statements of operations.dates.

Supplemental information on an unaudited pro forma basis is presented below as if the acquisition of ~~MediConnect~~Argus occurred at the beginning of the year ~~2011.~~2012. The pro forma information for the six months ended June 30, 2012 ~~and 2011~~ presented below is based on estimates and assumptions, which the Company believes are reasonable and not necessarily indicative of the consolidated financial position or results of operations in future periods or the results that actually would have been realized had ~~this acquisition~~these acquisitions been completed at the beginning of ~~2011.~~2012. The unaudited pro forma information includes intangible asset amortization charges and incremental borrowing costs as a result of the ~~acquisition,~~acquisitions, net of related tax, estimated using the Company’s effective tax rate for continuing operations for the ~~periods.~~

On June 17, 2011, the Company acquired the net assets of Health Risk Partners, LLC (“HRP”), a provider of solutions to optimize revenue, ensure compliance and improve quality of care for Medicare Advantage and Medicaid health plans, for a net cash purchase price of approximately $46,400 and funded $3,000 of indemnity escrows and $10,000 of contingency escrows. Within the Company’s Decision Analytics segment, this acquisition further advances the Company’s position as a major provider of data, analytics, and decision-support solutions to the healthcare vertical market.

On April 27, 2011, the Company acquired 100% of the stock of Bloodhound Technologies, Inc. (“Bloodhound”), a provider of real-time pre-adjudication medical claims editing, for a net cash purchase price of approximately $75,321 and funded $6,560 of indemnity escrows. Within the Company’s Decision Analytics segment, Bloodhound addresses the need of healthcare payers to control fraud and waste in a real-time claims-processing environment, and these capabilities align with the Company’s existing fraud identification tools in the healthcare vertical market.

The goodwill associated with Bloodhound is not deductible for tax purposes; whereas the goodwill associated with HRP is deductible for tax purposes as this was an asset purchase rather than a stock purchase. For the three and six months ended June 30, 2012, the Company incurred no transaction costs related to these acquisitions. In accordance with ASC 805, the allocation of the purchase prices for HRP and Bloodhound was revised during the measurement period. Refer to Note 6. Goodwill and Intangible Assets for further discussion.30:

Pursuant to the related acquisition agreements, the Company has funded various escrow accounts to satisfy pre-acquisition indemnity and tax claims arising subsequent to the acquisition ~~date,~~dates, as well as a portion of the contingent payments. At June 30, ~~2012~~2013 and December 31, ~~2011,~~2012, the current portion of the escrows amounted to ~~$45,508~~$31,716 and ~~$36,967,~~$29,277, and the noncurrent portion of the escrow amounted to $5,000 and ~~$4,508,~~$26,803, respectively. The current and noncurrent portions of the escrows have been included in “Other current assets” and “Other assets” in the accompanying condensed consolidated balance sheets, respectively.

The following is a summary of the change in goodwill from December 31, ~~2011~~2012 through June 30, ~~2012,~~2013, both in total and as allocated to the Company’s operating segments:


	Risk Assessment		Decision Analytics		Total		Risk Assessment		Decision Analytics		Total
Goodwill at December 31, 2011 (1)	$	27,908	$	682,036	$	709,944
Goodwill at December 31, 2012 (1)							$	55,555	$	1,191,904	$	1,247,459
Current year acquisition		—		223,982		223,982		—		705		705
Purchase accounting reclassifications		—		836		836		—		1,107		1,107

Goodwill at June 30, 2012 (1)	$	27,908	$	906,854	$	934,762
Goodwill at June 30, 2013 (1)							$	55,555	$	1,193,716	$	1,249,271

The Company finalized the purchase accounting for the ~~acquisitions~~acquisition of ~~HRP and Bloodhound~~MediConnect during the quarter ended ~~June 30, 2012.~~March 31, 2013. The ~~Company’s purchase accounting reclassifications primarily related to~~impact of the finalization of HRP and Bloodhound resulted in an increase in goodwill of $836, and an increase in liabilities of $1,233, an increase in other assets of $882 and a decrease in fixed assets of $226. The impact of these adjustments on the purchase accounting for MediConnect was immaterial to the condensed consolidated statements of operations for the three and six months ended June 30, ~~2012 and 2011 was immaterial.~~2013.

Goodwill and intangible assets with indefinite lives are subject to impairment testing annually as of June 30, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. Goodwill impairment testing compares the carrying value of each reporting unit to its fair value. If the fair value of the reporting unit exceeds the carrying value of the net assets, including goodwill assigned to that reporting unit, goodwill is not impaired. If the carrying value of the reporting unit’s net assets including goodwill exceeds the fair value of the reporting unit, then the Company will determine the implied fair value of the reporting unit’s goodwill. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value, then an impairment loss is recorded for the difference between the carrying amount and the implied fair value of goodwill. The Company completed the required annual impairment test as of June 30, ~~2012,~~2013, which resulted in no impairment of goodwill.

The Company’s intangible assets and related accumulated amortization consisted of the following:


	Weighted Average Useful Life	Cost		Accumulated Amortization			Net		Weighted Average Useful Life		Cost		Accumulated Amortization			Net
June 30, 2012
June 30, 2013
Technology-based	7 years	$	278,764	$	(165,511	)	$	113,253		8 years	$	313,590	$	(190,837	)	$	122,753
Marketing-related	5 years		63,552		(35,907	)		27,645		5 years		79,101		(46,703	)		32,398
Contract-based	6 years		6,555		(6,555	)		—		6 years		6,555		(6,555	)		—
Customer-related	12 years		273,237		(50,580	)		222,657		13 years		413,043		(81,662	)		331,381

Total intangible assets		$	622,108	$	(258,553	)	$	363,555			$	812,289	$	(325,757	)	$	486,532

December 31, 2011
December 31, 2012
Technology-based	7 years	$	235,654	$	(155,333	)	$	80,321		8 years	$	313,590	$	(177,929	)	$	135,661
Marketing-related	5 years		48,770		(33,190	)		15,580		5 years		79,101		(41,079	)		38,022
Contract-based	6 years		6,555		(6,482	)		73		6 years		6,555		(6,555	)		—
Customer-related	13 years		173,224		(42,774	)		130,450		13 years		413,043		(65,791	)		347,252

Total intangible assets		$	464,203	$	(237,779	)	$	226,424			$	812,289	$	(291,354	)	$	520,935

~~Consolidated amortization~~Amortization expense related to intangible assets for the three months ended June 30, 2013 and 2012 was $17,196 and ~~2011, was~~ $12,187, ~~and $8,877,~~ respectively. ~~Consolidated amortization~~Amortization expense related to intangible assets for the six months ended June 30, 2013 and 2012 was $34,403 and ~~2011, was~~ $20,774, ~~and $17,332,~~ respectively. Estimated amortization expense in future periods through ~~2017~~2018 and thereafter for intangible assets subject to amortization is as follows:


Year	Amount		Amount
2012	$	24,092
2013		42,977	$	29,903
2014		35,851		57,168
2015		33,387		51,252
2016		32,255		49,421
2017 and Thereafter		194,993
2017				48,518
2018 and Thereafter				250,270

	$	363,555	$	486,532

The Company’s effective tax rate for the three and six months ended June 30, ~~2012~~2013 was ~~39.47%~~36.17%, and ~~39.41%~~36.43%, respectively, compared to the effective tax rate for the three and six months ended June 30, ~~2011~~2012 of ~~39.86%~~39.47% and ~~40.00%~~39.41%, respectively. The ~~June 30, 2012~~ effective tax rate for the three and six months ended June 30, 2013 is lower than the June 30, ~~2011~~2012 effective tax rate primarily due to the continued execution of tax planning ~~strategies.~~strategies and the benefits of the Research & Development (“R&D”) tax credit. The American Taxpayer Relief Act of 2012 was enacted on January 2, 2013, which retroactively extended the R&D tax credit for the years 2012 and 2013 and enabled the Company to recognize the tax benefit of the 2012 credit in the first quarter of 2013. The difference between statutory tax rates and the Company’s effective tax rate is primarily attributable to state taxes and ~~non-deductible~~nondeductible share appreciation from the ISO ~~401(K)~~401(k) Savings and Employee Stock Ownership Plan (“KSOP”).

The following table presents short-term and long-term debt by ~~issuance:~~issuance as of June 30, 2013 and December 31, 2012:


	Issuance	Maturity	June 30,		December 31,
	Date	Date	2012		2011		Issuance Date		Maturity Date		2013		2012
Short-term debt and current portion of long-term debt:
Syndicated revolving credit facility	Various	Various	$	150,000	$	—		Various		Various	$	—	$	10,000
Prudential senior notes:
6.28% Series I senior notes	4/29/2008	4/29/2013		15,000		—
Aviva Investors senior notes:
6.46% Series A senior notes	4/27/2009	4/27/2013		30,000		—		4/27/2009		4/27/2013		—		30,000
Capital lease obligations and other	Various	Various		6,783		5,554
New York Life senior notes:
5.87% Series A senior notes								10/26/2007		10/26/2013		17,500		17,500
Principal senior notes:
6.16% Series B senior notes								8/8/2006		8/8/2013		25,000		25,000
Prudential senior notes:
6.13% Series G senior notes								8/8/2006		8/8/2013		75,000		75,000
5.84% Series H senior notes								10/26/2007		10/26/2013		17,500		17,500
6.28% Series I senior notes								4/29/2008		4/29/2013		—		15,000
Capital lease obligations								Various		Various		2,870		5,263

Short-term debt and current portion of long-term debt				201,783		5,554						137,870		195,263


Long-term debt:
Verisk senior notes:
5.800% senior notes, less unamortized discount of $915 and $967 as of June 30, 2012 and December 31, 2011, respectively	4/6/2011	5/1/2021		449,085		449,033
4.875% senior notes, less unamortized discount of $2,207 and $2,376 as of June 30, 2012 and December 31, 2011, respectively	12/8/2011	1/15/2019		247,793		247,624
5.800% senior notes, less unamortized discount of $810 and $862, respectively								4/6/2011		5/1/2021		449,190		449,138
4.875% senior notes, less unamortized discount of $1,867 and $2,037, respectively								12/8/2011		1/15/2019		248,133		247,963
4.125% senior notes, less unamortized discount of $2,554 and $2,692, respectively								9/12/2012		9/12/2022		347,446		347,308
New York Life senior notes:
5.87% Series A senior notes								10/26/2007		10/26/2015		17,500		17,500
6.35% Series B senior notes								4/29/2008		4/29/2015		50,000		50,000
Prudential senior notes:
6.13% Series G senior notes	8/8/2006	8/8/2013		75,000		75,000
5.84% Series H senior notes	10/26/2007	10/26/2013		17,500		17,500
5.84% Series H senior notes	10/26/2007	10/26/2015		17,500		17,500		10/26/2007		10/26/2015		17,500		17,500
6.28% Series I senior notes	4/29/2008	4/29/2013		—		15,000		4/29/2008		4/29/2015		85,000		85,000
6.28% Series I senior notes	4/29/2008	4/29/2015		85,000		85,000
6.85% Series J senior notes	6/15/2009	6/15/2016		50,000		50,000		6/15/2009		6/15/2016		50,000		50,000
Principal senior notes:
6.16% Series B senior notes	8/8/2006	8/8/2013		25,000		25,000
New York Life senior notes:
5.87% Series A senior notes	10/26/2007	10/26/2013		17,500		17,500
5.87% Series A senior notes	10/26/2007	10/26/2015		17,500		17,500
6.35% Series B senior notes	4/29/2008	4/29/2015		50,000		50,000
Aviva Investors senior notes:
6.46% Series A senior notes	4/27/2009	4/27/2013		—		30,000
Capital lease obligations and other	Various	Various		2,517		3,675
Capital lease obligations								Various		Various		2,141		1,753

Long-term debt				1,054,395		1,100,332						1,266,910		1,266,162

Total debt			$	1,256,178	$	1,105,886					$	1,404,780	$	1,461,425

As of June 30, ~~2012,~~2013, the Company has ~~a borrowing capacity of $725,000 under the syndicated revolving credit facility~~an $850,000 committed senior unsecured Syndicated Revolving Credit Facility (the “Credit Facility”) with Bank of America N.A., JPMorgan Chase Bank N.A., ~~Morgan Stanley Bank N.A., Wells Fargo Bank N.A., Sovereign Bank, RBS Citizens, N.A., Sun Trust Bank, The Northern Trust Company,~~ and ~~TD Bank N.A.~~a syndicate of banks. Borrowings may be used for general corporate purposes, including working capital needs and capital expenditures, acquisitions and the share repurchase ~~programs. This committed senior unsecured facility expires in October 2016.~~program (the “Repurchase Program”). As of June 30, ~~2012~~2013 and December 31, ~~2011,~~2012, the Company had ~~$150,000~~$0 and $0$10,000, respectively, outstanding under ~~this agreement, respectively. On July 2, 2012,~~ the ~~Company repaid $10,000 of the outstanding balance of the syndicated revolving credit facility.~~Credit Facility.

The Company has 1,200,000,000 shares of authorized Class A common ~~shares.~~stock. The ~~Class A~~ common shares have rights to any dividend declared by the board of directors, subject to any preferential or other rights of any outstanding preferred stock, and voting rights to elect all ~~eleven~~twelve members of the board of directors.

The Company has authorized repurchases of up to ~~$900,000~~$1,200,000 of its common stock through its ~~share repurchase program (the “Repurchase Program”) and as~~Repurchase Program, including the additional $300,000 authorized by the board of directors in June 2013. As of June 30, ~~2012,~~2013, the Company had ~~$199,737~~$306,557 available to repurchase shares. The Company has no obligation to repurchase stock under this program and intends to use this authorization as a means of offsetting dilution from the issuance of shares under the KSOP, the Verisk 2013 Equity Incentive Plan (the “2013 Incentive Plan”), the Verisk 2009 Equity Incentive Plan (the ~~“Incentive~~“2009 Incentive Plan”), and the ISO 1996 Incentive Plan (the ~~“Option~~“1996 Incentive Plan”), while providing flexibility to repurchase additional shares if warranted. This authorization has no expiration date and may be increased, reduced, suspended, or terminated at any time. Repurchased shares will be recorded as treasury stock and will be available for future issuance as part of the Repurchase Program.

During the six months ended June 30, ~~2012,~~2013, the Company repurchased ~~2,351,655~~2,326,130 shares of ~~Class A~~ common stock as part of this program at a weighted average price of ~~$45.52~~$59.17 per share. The Company utilized cash from operations ~~and the proceeds from its senior notes and syndicated revolving credit facility~~ to fund these repurchases. As treasury stock purchases are recorded based on trade date, the Company has included ~~$1,936~~$3,550 in “Accounts payable and accrued liabilities” in the accompanying condensed consolidated balance sheets for those purchases that have not settled as of June 30, ~~2012.~~

As of June 30, 2013, the Company’s treasury stock consisted of 376,374,014 shares of common stock. During the six months ended June 30, 2013, the Company reissued 2,228,081 shares of common stock from the treasury shares at a weighted average price of $4.37 per share.

Basic EPS is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding, using the treasury stock method, if the dilutive potential common shares, including stock options and nonvested restricted stock, had been issued.

The following is a reconciliation of the numerators and denominators of the basic and diluted EPS computations for the three and six months ended June 30, ~~2012~~2013 and ~~2011:~~2012:


	For the Three Months Ended				For the Six Months Ended				For the Three Months Ended June 30,				For the Six Months Ended June 30,
	June 30, 2012		June 30, 2011		June 30, 2012		June 30, 2011		2013		2012		2013		2012
Numerator used in basic and diluted EPS:
Net income	$	73,331	$	65,577	$	147,932	$	131,453	$	84,205	$	73,331	$	164,716	$	147,932

Denominator:
Weighted average number of common shares used in basic EPS		165,946,009		166,960,806		165,391,500		167,995,517		168,147,069		165,946,009		168,112,829		165,391,500
Effect of dilutive shares:
Potential Class A common shares issuable from stock options and stock awards		5,955,340		7,673,240		6,234,584		7,803,603
Potential common shares issuable from stock options and stock awards										4,320,619		5,955,340		4,501,335		6,234,584

Weighted average number of common shares and dilutive potential common shares used in diluted EPS		171,901,349		174,634,046		171,626,084		175,799,120		172,467,688		171,901,349		172,614,164		171,626,084

Basic net income per share	$	0.44	$	0.39	$	0.89	$	0.78	$	0.50	$	0.44	$	0.98	$	0.89

Diluted net income per share	$	0.43	$	0.38	$	0.86	$	0.75	$	0.49	$	0.43	$	0.95	$	0.86

The potential shares of common stock that were excluded from diluted EPS were ~~781,505~~925,109 and ~~1,402,980~~781,505 for the six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, respectively, because the effect of including these potential shares was anti-dilutive.

The following is a summary of accumulated other comprehensive ~~losses:~~losses as of June 30, 2013 and December 31, 2012:


	June 30,			December 31,			2013			2012
	2012			2011
Unrealized (losses)/gains on investments, net of tax	$	(44	)	$	269
Unrealized foreign currency losses		(1,109	)		(975	)	$	(1,641	)	$	(960	)
Unrealized (losses) gains on available-for-sale securities, net of tax								(242	)		72
Pension and postretirement unfunded liability adjustment, net of tax		(76,201	)		(77,581	)		(86,455	)		(88,272	)

Accumulated other comprehensive losses	$	(77,354	)	$	(78,287	)	$	(88,338	)	$	(89,160	)

The before tax and after tax amounts of other comprehensive income for the six months ended June 30, 2013 and 2012 are summarized below:

All of the Company’s ~~granted~~outstanding equity awards, including ~~outstanding~~ stock options and restricted stock, are covered under the 2013 Incentive Plan, 2009 Incentive Plan or ~~the Option~~1996 Incentive Plan. Awards under the 2013 Incentive Plan may include one or more of the following types: (i) stock options (both nonqualified and incentive stock options), (ii) stock appreciation rights, (iii) restricted stock, (iv) restricted stock units, (v) performance awards (including cash), and (vi) other share based ~~awards, and (vii) cash.~~awards. Employees, directors and consultants are eligible for awards under the 2013 Incentive Plan. ~~On July 1, 2011, the~~The Company ~~began issuing Class A~~issued common stock under these plans from the Company’s treasury shares. On May 15, 2013, the Company’s shareholders approved the 2013 Incentive Plan effective March 15, 2013. There are 15,700,000 shares of common stock available for issuance under the 2013 Incentive Plan. Shares subject to awards granted subsequent to March 15, 2013, whether under the 2013 Incentive Plan or the 2009 Incentive Plan, with certain exceptions, will reduce the number of shares available for issuance under the 2013 Incentive Plan. Cash received from stock option exercises for the six months ended June 30, 2013 and 2012 was $30,528 and ~~2011 was~~ $33,453, ~~and $18,032,~~ respectively.

On ~~July~~April 1, ~~2012,~~2013, the Company granted ~~3,174 shares of Class A common stock, 23,027~~804,726 nonqualified stock options ~~that were immediately vested~~ and ~~96,750 nonqualified~~208,881 shares of restricted stock ~~options with a one year service vesting period,~~to key employees, as well as 20,445 deferred stock units to the directors of the Company. These options have an exercise price equal to the closing price of the Company’s Class A common stock on the grant date and a ten year contractual term. As of June 30, 2012, there were 5,941,673 shares of Class A common stock reserved and available for future issuance under the plans.

~~On April 1, 2012, the Company granted 785,079 nonqualified stock options and 229,009 shares of restricted stock to key employees.~~ The nonqualified stock options have an exercise price equal to the closing price of the Company’s ~~Class A~~ common stock on ~~March 30, 2012,~~the grant date, with a ten-year contractual term and a service vesting period of four years. The restricted stock is valued at the closing price of the Company’s ~~Class A~~ common stock on ~~March 30, 2012~~the grant date and has a service vesting period of four years. The Company recognizes the expense of the restricted stock ratably over the ~~periods in which the restrictions lapse.~~vesting period. The restricted stock is not assignable or transferrable until it becomes vested. The deferred stock units are valued at the closing price of the Company’s common stock on the grant date, have a one-year vesting period, and will be distributed to the directors upon retirement or other separation from the board of directors.

On July 1, 2013, the Company granted 7,535 shares of common stock, 27,494 nonqualified stock options that were immediately vested, 54,032 nonqualified stock options with a one-year service vesting period, and 11,319 deferred stock units to the directors of the Company. The nonqualified stock options have an exercise price equal to the closing price of the Company’s common stock at the grant date and a ten-year contractual term. As of June 30, 2013, there were 14,419,876 shares of common stock reserved and available for future issuance under the 2013 Incentive Plan.

The fair value of the stock options granted during the six months ended June 30, ~~2012~~2013 and ~~2011~~2012 was estimated using a Black-Scholes valuation model that uses the weighted average assumptions noted in the following table:


	2012			2011			2013			2012
Option pricing model		Black-Scholes			Black-Scholes			Black-Scholes			Black-Scholes
Expected volatility		32.25	%		30.04	%		29.84	%		32.25	%
Risk-free interest rate		0.97	%		2.32	%		0.66	%		0.97	%
Expected term in years		4.8			5.3			4.5			4.8
Dividend yield		0.00	%		0.00	%		0.00	%		0.00	%
Weighted average grant date fair value per stock option	$	13.70		$	10.48		$	15.87		$	13.70

The expected term for a majority of the stock options granted was estimated based on studies of historical experience and projected exercise behavior. However, for certain stock options granted, for which no historical

exercise pattern exists, the expected term was estimated using the simplified method. The risk-free interest rate is based on the yield of U.S. Treasury zero coupon securities with a maturity equal to the expected term of the equity award. The volatility factor was based on the average volatility of the Company’s peers, calculated using historical daily closing prices over the most recent period that is commensurate with the expected term of the stock option award. The expected dividend yield was based on the Company’s expected annual dividend rate on the date of grant.

A summary of the stock options outstanding ~~under the Incentive Plan and the Option Plan~~ as of December 31, ~~2011~~2012 and June 30, ~~2012~~2013 and changes during the interim period isare presented below:

Intrinsic value for stock options is calculated based on the exercise price of the underlying awards and the quoted price of ~~Verisk’s~~the Company’s common stock as of the reporting date. ~~The aggregate intrinsic value of stock options outstanding and exercisable at June 30, 2012 was $459,054 and $348,780, respectively.~~ In accordance with ASC 718,Stock Compensation, excess tax benefit from exercised stock options is recorded as an increase to additional paid-in capital and a corresponding reduction in income taxes payable. This tax benefit is calculated as the excess of the intrinsic value of options exercised in excess of compensation recognized for financial reporting purposes. The amount of the tax benefit that has been realized, as a result of those excess tax benefits, is presented as a financing cash inflow within the accompanying condensed consolidated statements of cash flows. For the six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, the Company recorded excess tax benefit from stock options exercised of ~~$49,974~~$32,211 and ~~$16,530,~~$49,974, respectively. The Company realized ~~$31,624~~$63,934 and ~~$5,470~~$31,624 of tax benefit within the Company’s quarterly tax payments through June 30, ~~2012~~2013 and ~~2011,~~2012, respectively.

The Company estimates expected forfeitures of equity awards at the date of grant and recognizes compensation expense only for those awards that the Company expects to vest. The forfeiture assumption is ultimately adjusted to the actual forfeiture rate. Changes in the forfeiture assumptions may impact the total amount of expense ultimately recognized over the requisite service period and may impact the timing of expense recognized over the requisite service period.

A summary of the status of the restricted stock awarded ~~under the Incentive Plan~~ as of December 31, ~~2011~~2012 and June 30, ~~2012~~2013 and changes during the interim period is presented below:


	Number			Weighted average grant date fair value		Number of Shares			Weighted Average Grant Date Fair Value Per Share
	of shares			Weighted average grant date fair value
Outstanding at December 31, 2011		145,634		$	33.32
Outstanding at December 31, 2012							331,013		$	42.78
Granted		229,009		$	46.97		208,881		$	61.14
Vested		(36,752	)	$	33.48		(131,831	)	$	42.08
Forfeited		(2,779	)	$	38.44		(14,944	)	$	52.61

Outstanding at June 30, 2012		335,112		$	42.57
Outstanding at June 30, 2013							393,119		$	52.40

As of June 30, ~~2012,~~2013, there was ~~$47,945~~$50,716 of total unrecognized compensation costs, exclusive of the impact of vesting upon retirement eligibility, related to nonvested share-based compensation arrangements granted under

the 2009 and 2013 Incentive ~~Plan and the Option Plan.~~Plans. That cost is expected to be recognized over a weighted average period of ~~2.75~~2.85 years. As of June 30, ~~2012,~~2013, there were ~~5,287,764~~2,559,626 and ~~335,112~~393,119 nonvested stock options and restricted stock, respectively, of which ~~4,673,449~~2,116,211 and ~~285,007~~316,002 are expected to vest. The total grant date fair value of options vested during the six months ended June 30, 2013 and 2012 was $8,581 and ~~2011 was~~ $10,053, ~~and $9,838,~~ respectively. The total grant date fair value of restricted stock vested during the six months ended June 30, 2013 and 2012 was $2,849 and ~~2011 was~~ $1,263, ~~and $305,~~ respectively.

~~On May 16, 2012, the~~The Company’s ~~stockholders approved the implementation of an~~ employee stock purchase plan (“ESPP”)~~. The ESPP will commence~~ commenced on October 1, 2012 and ~~offer~~offers eligible employees the opportunity to authorize payroll deductions of up to 20.00% of their regular base salary and up to 50.00% of their short-term incentive compensation, both of which in total may not exceed $25 in any calendar year, to purchase shares of the Company’s ~~Class A~~ common stock at a 5.00% discount of its fair market value at the time of purchase. In accordance with ASC 718, the ESPP is noncompensatory as the purchase discount is 5.00% or less from the fair market value, substantially all employees that meet limited employment qualifications may participate, and it incorporates no option features. During the six months ended June 30, 2013, the Company issued 15,173 shares of common stock at a weighted discounted price of $57.56.

On April 20, 2013, the employee stock ownership plan (“ESOP”) refinanced its intercompany loan between the Company and the KSOP, thereby extending the allocation of the remaining unreleased shares through 2016. As a part of this new loan agreement, the Company is required to contribute an additional $9,000, plus interest, of cash or shares to the ESOP by 2016. Earlier contribution is at the Company’s discretion.

The Company maintained a qualified defined benefit pension plan for ~~substantially all~~certain of its employees ~~hired prior to March 1, 2005~~ through membership in the Pension Plan for Insurance Organizations (the “Pension Plan”), a multiple-employer trust. ~~Future benefits provided to participants within the Pension Plan are determined using~~The Company has applied a cash balance ~~formula.~~formula to determine future benefits. Under the cash balance formula, each participant has an account, which is credited annually based on salary rates determined by years of service, as well as the interest earned on ~~their~~the previous year-end cash balance. The ~~Profit Sharing Plan, a defined contribution plan, replaced the Pension Plan for all eligible employees hired on or after March 1, 2005. The~~ Company also has a ~~nonqualified~~non-qualified supplemental cash balance plan (“SERP”) for certain employees. The SERP is funded from the general assets of the Company.

On Effective February 29, 2012, the Company instituted a hard freeze, which eliminated all future compensation and ~~services~~service credits, to all participants in the Pension Plan and SERP. Accordingly, the Company remeasured the assets and liabilities of both plans and recognized a curtailment, resulting in a net reduction in the unfunded pension liability of $10,466 as of March 31, 2012. There is no longer a service cost component in the net periodic benefit cost as all participants are considered inactive in both plans. The Company generally amortized the actuarial gains and losses for the plans over the average future service period of the active participants. However, beginning February 29, 2012, the Company is amortizing the actuarial losses over the remaining life of the inactive plan participants since all are now considered inactive. The February 29, 2012 remeasurement utilized a weighted average discount rate of 4.73%, compared to the rate of 4.98% used for the year ended December 31, 2011.

The Company also provides certain healthcare and life insurance benefits for both active and retired employees. The Postretirement Health and Life Insurance Plan (the “Postretirement Plan”) is contributory, requiring participants to pay a stated percentage of the premium for coverage. As of October 1, 2001, the Postretirement Plan was amended to freeze benefits for current retirees and certain other employees at the January 1, 2002 level. Also, as of October 1, 2001, the Postretirement Plan had a curtailment, which eliminated retiree life insurance for all active employees and healthcare benefits for almost all future retirees, effective January 1, 2002.

The components of net periodic ~~benefit (credit)/~~(benefit) cost ~~and the amounts recognized in other comprehensive income~~ for the three and six months ended June 30 ~~2012 and 2011~~ are summarized below:


	Pension Plan and SERP						Postretirement Plan						Pension Plan and SERP						Postretirement Plan
	For the Three Months Ended June 30,												For the Three Months Ended June 30,
	2012			2011			2012			2011			2013			2012			2013			2012
Service cost	$	—		$	1,611		$	—		$	—		$	—		$	—		$	—		$	—
Interest cost		4,883			5,397			175			251			4,496			4,883			150			175
Expected return on plan assets		(7,279	)		(6,434	)		(120	)		—			(7,643	)		(7,279	)		(213	)		(120	)
Amortization of prior service credit		—			(201	)		(37	)		(36	)		—			—			(37	)		(37	)
Amortization of net actuarial loss		610			1,406			137			163			1,263			610			150			137

Net periodic benefit (credit)/cost	$	(1,786	)	$	1,779		$	155		$	378
Net periodic (benefit) cost													$	(1,884	)	$	(1,786	)	$	50		$	155

Employer contributions	$	72,362		$	6,487		$	5,583		$	1,067		$	101		$	72,362		$	235		$	5,583


	For the Six Months Ended June 30,
	2012			2011			2012			2011
Service cost	$	282		$	3,181		$	—		$	—
Interest cost		10,037			10,838			350			502
Expected return on plan assets		(14,347	)		(12,899	)		(120	)		—
Curtailment gain		(779	)		—			—			—
Amortization of prior service credit		(133	)		(401	)		(75	)		(72	)
Amortization of net actuarial loss		2,351			2,815			275			326
						��
Net periodic benefit (credit)/cost	$	(2,589	)	$	3,534		$	430		$	756

Employer contributions	$	79,355		$	12,655		$	9,652		$	1,382

~~In March 2012, the Company established a voluntary employees beneficiary association plan (the “VEBA Plan”) under Section 501(c)(9) of the Internal Revenue Code to fund the Postretirement Plan.~~


	For the Six Months Ended June 30,
	2013			2012			2013			2012
Service cost	$	—		$	282		$	—		$	—
Interest cost		8,923			10,037			300			350
Expected return on plan assets		(15,240	)		(14,347	)		(425	)		(120	)
Curtailment gain		—			(779	)		—			—
Amortization of prior service credit		—			(133	)		(75	)		(75	)
Amortization of net actuarial loss		2,552			2,351			300			275

Net periodic (benefit) cost	$	(3,765	)	$	(2,589	)	$	100		$	430

Employer contributions	$	201		$	79,355		$	235		$	9,652

The ~~Company contributed $5,000 and $8,500~~expected contributions to the ~~VEBA~~Pension Plan, ~~for the three~~SERP and ~~six months ended June 30, 2012, respectively. The contribution to the~~ Postretirement Plan ~~for the remaining quarters~~ for the year ending December 31, ~~2012 is expected to be~~2013 are consistent with ~~this quarter. In addition, in April 2012,~~ the ~~Company completed a voluntary prefunding to the Pension Plan~~amounts previously disclosed as of $72,000, which resulted in a total contribution of $78,837 for the year, of which $28,206 was the minimum contribution requirement for 2012. Since the Company has fulfilled the minimum contribution requirement for the year ending December 31, ~~2012, the Company does not expect to make any further contribution to the Pension Plan.~~2012.

ASC 280-10,Disclosures About Segments of an Enterprise and Related Information (“(“ASC 280-10”), establishes standards for reporting information about operating segments. ASC 280-10 requires that a public business enterprise report financial and descriptive information about its reportable operating segments.

Operating segments are components of an enterprise for which separate financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company’s Chief Executive Officer and ~~Chairman of the Board~~President is identified as the CODM as defined by ASC 280-10. To align with the internal management of the Company’s business operations based on service offerings, the Company is organized into the following two operating segments, which are also the Company’s reportable segments:

Decision Analytics:The Company develops solutions that its customers use to analyze the three key processes in managing risk: ‘prediction of loss’, ‘detection and prevention of fraud’ and ‘quantification of loss’. The Company’s combination of algorithms and analytic methods incorporates its proprietary data to generate solutions in each of these three categories. In most cases, the Company’s customers integrate the solutions into their models, formulas or underwriting criteria in order to predict potential loss events, ranging from hurricanes and earthquakes to unanticipated healthcare claims. The Company develops catastrophe and extreme event models and offers solutions covering natural and man-made risks, including acts of terrorism. The Company also develops solutions that allow customers to quantify costs after loss events occur. Fraud solutions include data on claim histories, analysis of mortgage applications to identify misinformation, analysis of claims to find emerging patterns of fraud, and identification of suspicious claims in the insurance, mortgage and healthcare sectors. ~~Effective December 31, 2011, the~~The Company ~~provided additional disclosure about its~~discloses revenue within ~~Decision Analytics~~this segment based on the industry vertical groupings of insurance, ~~mortgage and~~ financial services, healthcare and specialized markets. ~~Previously, the Company disclosed revenues based on the classification of its solutions as fraud identification and detection solutions, loss prediction solutions and loss quantification solutions.~~

Risk Assessment:The Company is the leading provider of statistical, actuarial and underwriting data for the U.S. P&C insurance industry. The Company’s databases include cleansed and standardized records describing premiums and losses in insurance transactions, casualty and property risk attributes for commercial buildings and their occupants and fire suppression capabilities of municipalities. The Company uses this data to create policy language and proprietary risk classifications that are industry standards and to generate prospective loss cost estimates used to price insurance policies. Effective December 31, 2012, the Company combined the statistical agency and data services and actuarial services into industry-standard insurance programs within the Risk Assessment segment. There have been no changes in reportable segments in accordance with ASC 280-10 for the three and six months ended June 30, 2012.

The two aforementioned operating segments represent the segments for which separate discrete financial information is available and upon which operating results are regularly evaluated by the CODM in order to assess

performance and allocate resources. The Company uses EBITDA as the profitability measure for making decisions regarding ongoing operations. EBITDA is net income before interest expense, provision for income taxes, depreciation and amortization of fixed and intangible assets. In the second quarter of 2012, the Company changed its definition of EBITDA such that it only reflects the definition noted and no longer excludes investment income/(loss) and realized gain/(loss) on securities, net, for all periods presented. EBITDA is the measure of operating results used to assess corporate performance and optimal utilization of debt and acquisitions. Operating expenses consist of direct and indirect costs principally related to personnel, facilities, software license fees, consulting, travel, and third-party information services. Indirect costs are generally allocated to the segments using fixed rates established by management based upon estimated expense contribution levels and other assumptions that management considers reasonable. The Company does not allocate interest expense and provision for income taxes, since these items are not considered in evaluating the segment’s overall operating performance. The CODM does not evaluate the financial performance of each segment based on assets. On a geographic basis, no individual country outside of the U.S. accounted for 1.00% or more of the Company’s consolidated revenue for ~~either~~ the three and six months ended June 30, ~~2012~~2013 or ~~2011.~~2012. No individual country outside of the U.S. accounted for 1.00% or more of total consolidated long-term assets as of June 30, ~~2012~~2013 or December 31, ~~2011.~~2012.

The following table provides the Company’s revenue and operating income ~~performance~~ by reportable segment for the three and six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, as well as reconciliations to income before income taxes for all periods presented in the accompanying condensed consolidated statements of operations:


	For the Six Months Ended								For the Six Months Ended
	June 30, 2012								June 30, 2011
	Decision		Risk						Decision			Risk						For the Three Months Ended June 30, 2013								For the Three Months Ended June 30, 2012
	Analytics		Assessment			Total			Analytics			Assessment			Total			Decision Analytics		Risk Assessment			Total			Decision Analytics		Risk Assessment			Total
Revenues	$	430,569	$	289,158		$	719,727		$	359,076		$	281,073		$	640,149		$	267,061	$	154,259		$	421,320		$	229,037	$	144,189		$	373,226
Expenses:

Cost of revenues (exclusive of items shown separately below)		189,667		90,737			280,404			159,431			96,310			255,741			126,204		48,459			174,663			101,769		45,305			147,074
Selling, general and administrative		73,939		42,513			116,452			62,693			42,472			105,165			41,549		19,603			61,152			39,562		22,911			62,473
Acquisition related liabilities adjustment		—		—			—			(3,364	)		—			(3,364	)
Investment income and realized gain on securities, net		—		(561	)		(561	)		—			(487	)		(487	)
Investment income and realized gain on available-for-sale securities, net																			—		(133	)		(133	)		—		(126	)		(126	)

EBITDA		166,963		156,469			323,432			140,316			142,778			283,094			99,308		86,330			185,638			87,706		76,099			163,805
Depreciation and amortization of fixed assets		17,506		7,228			24,734			14,312			7,848			22,160			13,141		3,670			16,811			9,021		4,069			13,090
Amortization of intangible assets		20,774		—			20,774			17,260			72			17,332			17,108		88			17,196			12,187		—			12,187
Investment income and realized gain on securities, net		—		561			561			—			487			487
Investment income and realized gain on available-for-sale securities, net																			—		133			133			—		126			126

Operating income	$	128,683	$	148,680			277,363		$	108,744		$	134,371			243,115		$	69,059	$	82,439			151,498		$	66,498	$	71,904			138,402

Investment income and realized gain on securities, net							561									487
Investment income and realized gain on available-for-sale securities, net																								133								126
Interest expense							(33,762	)								(24,500	)							(19,704	)							(17,377	)

Income before income taxes						$	244,162								$	219,102							$	131,927							$	121,151

Capital expenditures, including noncash purchases of fixed assets and capital lease obligations	$	29,657	$	8,345		$	38,002		$	27,564		$	6,789		$	34,353		$	29,542	$	6,022		$	35,564		$	16,425	$	5,645		$	22,070


	For the Six Months Ended June 30, 2013								For the Six Months Ended June 30, 2012
	Decision Analytics		Risk Assessment			Total			Decision Analytics		Risk Assessment			Total
Revenues	$	517,771	$	306,872		$	824,643		$	430,569	$	289,158		$	719,727
Expenses:
Cost of revenues (exclusive of items shown separately below)		243,836		95,276			339,112			189,667		90,737			280,404
Selling, general and administrative		81,004		39,176			120,180			73,939		42,513			116,452
Investment income and realized loss (gain) on available-for-sale securities, net		—		12			12			—		(561	)		(561	)

EBITDA		192,931		172,408			365,339			166,963		156,469			323,432
Depreciation and amortization of fixed assets		25,017		7,008			32,025			17,506		7,228			24,734
Amortization of intangible assets		34,227		176			34,403			20,774		—			20,774
Investment income and realized (loss) gain on available-for-sale securities, net		—		(12	)		(12	)		—		561			561

Operating income	$	133,687	$	165,236			298,923		$	128,683	$	148,680			277,363

Investment income and realized (loss) gain on available-for-sale securities, net							(12	)							561
Interest expense							(39,794	)							(33,762	)

Income before income taxes						$	259,117							$	244,162

Capital expenditures, including noncash purchases of fixed assets and capital lease obligations	$	50,732	$	13,359		$	64,091		$	29,657	$	8,345		$	38,002

Operating segment revenue by type of service is provided ~~below:~~below for the three and six months ended June 30:


	For the Three Months Ended				For the Six Months Ended				For the Three Months Ended				For the Six Months Ended
	June 30, 2012		June 30, 2011		June 30, 2012		June 30, 2011		2013		2012		2013		2012
Decision Analytics:
Insurance	$	122,210	$	112,334	$	238,546	$	217,634	$	133,785	$	122,210	$	260,334	$	238,546
Mortgage and financial services		35,299		35,643		69,574		68,339
Financial services										50,529		35,299		94,437		69,574
Healthcare		50,381		19,322		80,829		34,939		61,087		50,381		120,136		80,829
Specialized markets		21,147		19,451		41,620		38,164		21,660		21,147		42,864		41,620

Total Decision Analytics		229,037		186,750		430,569		359,076		267,061		229,037		517,771		430,569

Risk Assessment:
Industry-standard insurance programs		98,010		92,389		197,144		185,246		117,289		111,730		233,739		224,142
Property-specific rating and underwriting information		32,459		35,017		65,016		69,514		36,970		32,459		73,133		65,016
Statistical agency and data services		8,130		7,633		15,854		15,375
Actuarial services		5,590		5,491		11,144		10,938

Total Risk Assessment		144,189		140,530		289,158		281,073		154,259		144,189		306,872		289,158

Total revenues	$	373,226	$	327,280	$	719,727	$	640,149	$	421,320	$	373,226	$	824,643	$	719,727

The Company considers its stockholders that own more than 5%5.00% of the outstanding common stock ~~within a respective class~~ to be related parties as defined within ASC 850,Related Party Disclosures. ~~In 2011, all~~As of ~~the Company’s outstanding Class B (Series 1)~~June 30, 2013 and ~~Class B (Series 2) shares converted to Class A. As a result of the conversion,~~December 31, 2012, the Company had no related parties owning more than 5%5.00% of ~~a class of stock as of June 30, 2012.~~its common stock.

At June 30, 2011, there were three Class A and five Class B stockholders, each owning more than 5% of the respective outstanding class. The Company had revenues from related parties for the three months ended June 30, 2012 and 2011 of $0 and $4,787, respectively, and revenues of $0 and $9,183 for the six months ended June 30, 2012 and 2011, respectively.

The Company is a party to legal proceedings with respect to a variety of matters in the ordinary course of business, including the matters described below. With respect to ongoing matters, the Company is unable, at the present time, to determine the ultimate resolution of or provide a reasonable estimate of the range of possible loss attributable to these matters or the impact it may have on the Company’s results of operations, financial position or cash flows. This is primarily because the matters are in early stages and discovery has either not commenced or been completed. Although the Company believes it has strong defenses and intends to vigorously defend these matters, the Company could in the future incur judgments or enter into settlements of claims that could have a material adverse effect on its results of operations, financial position or cash flows.

On February 28, 2012, the Company was served with a complaint filed in the Florida State Circuit Court for Pasco County naming Citizens Property Insurance Corporation (“Citizens”) and the Company’s Xactware subsidiary. The complaint alleged a class action seeking declaratory and injunctive relief against defendants and was brought on behalf of “all individuals who have purchased a new or renewed a property casualty insurance policy from Citizens” where Citizens used Xactware’s 360Value product to determine replacement value of the property. On March 12, 2012, plaintiffs served their First Amended Complaint on Xactware additionally alleging that: (1) Citizens and Xactware knowingly made false statements to the plaintiff class concerning their properties’ replacement cost values; (2) fraud against Xactware based on its alleged misrepresentation of the replacement value of plaintiffs’ properties; (3) conspiracy against Citizens and Xactware based on their alleged artificial inflation of the value of plaintiffs’ properties; and (4) products liability against Xactware, claiming Xactware defectively designed 360Value as used in the Florida insurance market. The First Amended Complaint sought declaratory and injunctive relief, as well as unspecified monetary damages alleged to be in excess of $1,000 for the class. On May 31, 2012 plaintiff served his Second Amended Complaint which no longer alleges a class action, but continues to allege: (1) that Citizens and Xactware artificially inflated the replacement cost value of plaintiff’s property using 360Value; (2) fraud by Xactware; (3) a conspiracy between Citizens and Xactware; and (4) products liability against Xactware. The Second Amended Complaint similarly seeks declaratory and injunctive relief as well as damages representing the difference between the premium plaintiff paid to Citizens using 360Value and what the premium should have been if Citizens used an accurate replacement cost value for plaintiff’s property.

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

On April 20, 2012, the Company was served with a class action complaint filed in Alameda County Superior Court in California naming the Company’s subsidiary Intellicorp Records, Inc. ~~The complaint~~(“Intellicorp”) titledJane Roe v. Intellicorp Records, Inc. ~~et al.~~alleges a nationwide putative class action on behalf of all persons who have been the subject of a consumer report furnished to a third party by Intellicorp for employment purposes and whose report contained any negative public record of criminal arrest, charge or conviction during the 5 years preceding the filingThe complaint alleged violations of the ~~action until final resolution. The complaint alleges~~Fair Credit Reporting Act (“FCRA”) and claimed that Intellicorp failed to implement ~~policies and~~reasonable procedures ~~designed~~to assure maximum possible accuracy of the adverse information contained in the background reports, failed to maintain strict procedures to ensure that criminal record information provided to employers is complete and up to date, and failed to notify class members contemporaneously of the fact that criminal record information was being provided to their employers and prospective employers. Intellicorp removed the case to the United States District Court of the Northern District of California. The ~~complaint~~California Court later granted Intellicorp’s motion to transfer the case, which is now pending in the United States District Court for the Northern District of Ohio. On October 24, 2012 plaintiffs served their First Amended Complaint (the “Roe Complaint”) alleging a nationwide putative class action on behalf of all persons who were the subject of a Criminal SuperSearch or other “instant” consumer background report furnished to a third party by Intellicorp for employment purposes, and whose report contained any negative public record of criminal arrest, charge, or conviction without also disclosing the final disposition of the charges during the 5 years preceding the filing of this action through the date class certification is granted. The Roe Complaint 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, costs and ~~attorneys~~attorneys’ fees. On February 4, 2013, the Court granted plaintiffs’ motion to amend the Roe Complaint to eliminate the named plaintiff’s individual claim for compensatory damages. This amendment did not change the breadth or scope of the request for relief sought on behalf of the proposed class. Plaintiffs later amended their class definition in their motion for class certification to include only those consumers whose (1) Criminal SuperSearch returned results, but Single County search returned no result; (2) Criminal SuperSearch returned one or more criminal charges without a disposition, but the Single County search returned a disposition other than “conviction” or “guilty” and (3) Criminal SuperSearch returned a higher level of offense (felony or misdemeanor) for one or more criminal charges than the Single County search (misdemeanor or infraction.) This amendment reduces the size of the potential class, but does not alter the time period for which the plaintiffs seek to certify a class or the scope of the request for relief sought on behalf of the proposed class. Plaintiffs’ motion for class certification was fully submitted on March 18, 2013 and oral argument was heard by Judge Gwin on June 27, 2013.

On November 1, 2012, the Company was served with a complaint filed in the United States District Court for the Northern District of Ohio naming the Company’s subsidiary Intellicorp Records, Inc. titled Michael R. Thomas v. Intellicorp Records, Inc. On January 7, 2013 plaintiff served its First Amended Complaint (the “Thomas Complaint”) to add Mark A. Johnson (the plaintiff in the Johnson v. iiX matter described below) as a named plaintiff. The Thomas Complaint alleges a nationwide putative class action for violations of FCRA on behalf of “[a]ll natural persons residing in the United States (a) who were the subject of a report sold by Intellicorp to a third party, (b) that was furnished for an employment purpose, (c) that contained at least one public record of a criminal conviction or arrest, civil lien, bankruptcy or civil judgment, (d) within five years next preceding the filing of this action and during its pendency, and (e) to whom Intellicorp did not place in the United States mail postage-prepaid, on the day it furnished any part of the report, a written notice that it was furnishing the subject report and containing the name of the person that was to receive the report.” The Thomas

Complaint proposes an alternative subclass as follows: “[a]ll natural persons residing in Ohio or Tennessee (a) who were the subject of a report sold by Intellicorp to a third party, (b) that was furnished for an employment purpose, (c) that contained at least one public record of a criminal conviction or arrest, civil lien, bankruptcy or civil judgment, (d) within five years next preceding the filing of this action and during its pendency, (e) when a mutual review of the record would reveal that the identity associated with the public record does not match the identity of the class member about whom the report was furnished, and (f) to whom Intellicorp did not place in the United States mail postage pre-paid, on the day it furnished any part of the report, a written notice that it was furnishing the subject report and containing the name of the person that was to receive the report.” Similar to the Roe action, the Thomas Complaint alleges that Intellicorp violated the FCRA, asserting that Intellicorp violated section 1681k(a)(1) of the FCRA because it failed to provide notice to the plaintiffs “at the time” the adverse public record information was reported. The named plaintiffs also allege individual claims under section 1681e(b) claiming that Intellicorp failed to follow reasonable procedures to assure maximum possible accuracy in the preparation of the consumer report it furnished pertaining to plaintiffs. The Thomas Complaint 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, costs and attorneys’ fees, as well as ~~unspecified monetary~~compensatory and punitive damages on behalf of the named plaintiffs.

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

On January 3, 2013 the Company received service of a complaint filed in the United States District Court for the Southern District of Ohio naming the Company’s subsidiary Insurance Information Exchange (“iiX”) titled Mark A. Johnson v. Insurance Information Exchange, LLC (the “Johnson Complaint”). The Johnson Complaint alleges a nationwide putative class action on behalf of “[a]ll natural persons residing in the United States who were the subject of a consumer report prepared by iiX for employment purposes within five (5) years prior to the filing of this Complaint and to whom iiX did not provide notice of the fact that public record information which is likely to have an adverse effect upon the consumer’s ability to obtain employment, is being reported by iiX, together with the name and address of the person to whom such information is being reported at the time such public record information is reported to the user of such consumer report.” Similar to the Thomas matter, the Johnson Complaint alleges violations of section 1681k(a) of the FCRA claiming that iiX failed to notify customers contemporaneously that criminal record information was provided to a prospective employer and failed to maintain strict procedures to ensure that the information reported is complete and up to date. The Johnson Complaint seeks statutory damages for the ~~named plaintiff.~~class in an amount not less than one hundred dollars and not more than one thousand dollars per violation, punitive damages, costs and attorneys’ fees.

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

On May 13, 2013 the Company was served with a putative class action titled Celeste Shaw v. Interthinx, Inc., Verisk Analytics, Inc. and Jeffery Moyer. The plaintiff is a current employee of the Company’s subsidiary Interthinx, Inc. based in Colorado, who filed the class action in the United States District Court for the District of Colorado on behalf of all fraud detection employees who have worked for Interthinx for the last three years nationwide and who were classified as exempt employees. The class complaint claims that the fraud detection 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 three causes of action against defendants: (1) Collective Action under section 216(b) of the Fair Labor Standards Act for unpaid overtime (nationwide class); (2) A Fed. R. Civ. P. 23 class action under the Colorado Wage Act and Wage Order for unpaid overtime and (3) A Fed. R. Civ. P. 23 class action under Colorado Wage Act for unpaid commissions/nondiscretionary bonuses (Colorado class). The complaint seeks compensatory damages, penalties that are associated with the various statutes, declaratory and injunctive relief interest, costs and attorneys’ fees.

On July 2, 2013 the Company was served with a putative class action titled Shabanam Shelia Dehdashtian v. Interthinx, Inc. and Verisk Analytics, Inc. in the United States District Court for the Central District of California. The plaintiff, Shabnam Shelia Dehdashtian, a former mortgage auditor at the Company’s subsidiary Interthinx, Inc. in California, filed the class action on behalf of all persons who have been employed by Interthinx as auditors, mortgage compliance underwriters and mortgage auditors nationwide at anytime (i) within 3 years prior to the filing of this action until trial for the Fair Labor Standards Act (FLSA) class and (ii) within 4 years prior to the filing of the initial complaint until trial for the California collective action. The class complaint claims that the defendants failed to pay overtime compensation, to provide rest and meal periods, waiting time penalties and to provide accurate wage statements to the plaintiffs as required by federal and California law. It pleads seven causes of action against defendants: (1) Failure to pay overtime compensation in violation of the FLSA for unpaid overtime (nationwide class); (2) Failure to pay overtime compensation in violation of Cal. Lab. Code sections 510, 1194 and 1198 and IWC Wage Order No. 4; (3) Failure to pay waiting time penalties in violation of Cal. Lab. Code sections 201-203; (4) Failure to provide itemized wage statements in violation of Cal. Lab. Code section 226 and IWC Order No. 4; (5) Failure to provide and or authorize meal and rest periods in violation of Cal. Lab. Code section 226.7 and IWC Order No. 4; (6) Violation of California Business and Professions Code sections 17200 et seq; and (7) a Labor Code Private Attorney General Act (PAGA) Public enforcement claim, Cal. Lab. Code section 2699 (California class). The complaint seeks compensatory damages, penalties that are associated with the various statutes, equitable and injunctive relief, interest, costs and attorneys’ fees.

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

On July 8, 2013 the Company was served with a summons and complaint filed in the United States District Court for the Southern District of New York in an action titled Mariah Re LTD. v. American Family Mutual Insurance Company, ISO Services, Inc. and AIR Worldwide Corporation. Plaintiff Mariah is a special purpose vehicle established to provide reinsurance to defendant American Family Insurance. Mariah entered into contracts with the Company’s ISO Services, Inc. and AIR Worldwide Corporation subsidiaries, pursuant to which, among other things, Mariah (i) licensed the right to utilize information published in Catastrophe Bulletins issued by the Property Claims Services division of ISO Services, Inc. and (ii) and engaged AIR Worldwide Corporation as Calculation Agent to compute certain reinsured losses. The complaint alleges the following causes of action: (1) breach of contract against ISO Services, Inc. and AIR Worldwide Corporation; (2) unjust enrichment against American Family; (3) conversion against American Family; (4) tortuous interference with contract against American Family; (5) declaratory judgment against all defendants and (6) specific performance against all defendants. The complaint seeks declaratory relief, specific performance, restitution, monetary damages and attorneys’ fees.

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

15. Condensed Consolidated Financial Information for Guarantor Subsidiaries and Non-Guarantor Subsidiaries

~~In April and December 2011,~~ Verisk Analytics, Inc. (the “Parent Company”) registered senior notes with full and unconditional and joint and several guarantees by certain of its 100 percent wholly-owned subsidiaries and issued certain other debt securities with full and unconditional and joint and several guarantees by certain of its subsidiaries. Accordingly, presented below is the condensed consolidating financial information for (i) the Parent Company, (ii) the guarantor subsidiaries of the Parent Company on a combined basis and (iii) all other non-guarantor subsidiaries of the Parent Company on a combined basis, as of June 30, ~~2012~~2013 and December 31, ~~2011~~2012 and for the three and six months ended June 30, ~~2012~~2013 and ~~2011.~~2012. The condensed consolidating financial information has been presented using the equity method of accounting, to show the nature of assets held, results of operations and cash flows of the Parent Company, the guarantor subsidiaries and the non-guarantor subsidiaries assuming all guarantor subsidiaries provide both full and unconditional, and joint and several guarantees to the Parent Company at the beginning of the periods presented. Effective as of December 31, 2011, ISO Staff Services, Inc. (“ISOSS”), a guarantor of the senior notes, merged with and into ISO, also a guarantor of the senior notes, pursuant to which ISO was the surviving corporation. By virtue of the merger, ISO expressly assumed all of the obligations of ISOSS, including the guarantee by ISOSS of the senior notes. The Company corrected certain classifications on the Condensed Consolidating Statement of Cash Flows for the six-month period ended June 30, 2011 within the Guarantor Subsidiaries, which removed a gross-up in the repayments received from other subsidiaries and repayments of advances to other subsidiaries reflected in cash flows from investing activities and cash flows from financing activities, respectively. This correction did not have any impact on the net cash position of the Guarantor Subsidiaries.


												Verisk Analytics, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated
	Verisk Analytics, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated		(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	511	$	47,729	$	48,958	$	—		$	97,198	$	40,189	$	60,012	$	72,386	$	—		$	172,587
Available-for-sale securities		—		4,782		—		—			4,782		—		4,254		—		—			4,254
Accounts receivable, net of allowance for doubtful accounts of $4,088		—		128,269		45,338		—			173,607
Accounts receivable, net													—		121,821		64,728		—			186,549
Prepaid expenses		—		26,043		2,449		—			28,492		—		27,979		3,069		—			31,048
Deferred income taxes, net		—		2,557		13,056		—			15,613		—		375		10,088		—			10,463
Federal and foreign income taxes receivable		6,717		27,429		—		(6,441	)		27,705
State and local income taxes receivable		516		2,757		365		—			3,638
Income taxes receivable													10,047		59,545		—		(15,579	)		54,013
Intercompany receivables		349,949		528,301		182,176		(1,060,426	)		—		522,777		398,269		213,356		(1,134,402	)		—
Other current assets		12,000		25,898		8,562		—			46,460		2,870		29,243		2,582		—			34,695

Total current assets		369,693		793,765		300,904		(1,066,867	)		397,495		575,883		701,498		366,209		(1,149,981	)		493,609

Noncurrent assets:
Fixed assets, net		—		113,471		20,260		—			133,731		—		150,738		35,190		—			185,928
Intangible assets, net		—		72,008		291,547		—			363,555		—		56,706		429,826		—			486,532
Goodwill		—		482,110		452,652		—			934,762		—		516,410		732,861		—			1,249,271
Deferred income taxes, net		—		49,957		—		(49,957	)		—		—		815		—		(815	)		—
Investment in subsidiaries		762,711		456,126		—		(1,218,837	)		—		1,129,374		911,819		—		(2,041,193	)		—
Other assets		10,932		11,411		1,457		—			23,800		13,343		9,451		1,217		—			24,011

Total assets	$	1,143,336	$	1,978,848	$	1,066,820	$	(2,335,661	)	$	1,853,343	$	1,718,600	$	2,347,437	$	1,565,303	$	(3,191,989	)	$	2,439,351

LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	13,166	$	93,173	$	47,345	$	—		$	153,684	$	22,773	$	76,053	$	59,135	$	—		$	157,961
Short-term debt and current portion of long-term debt		—		201,248		535		—			201,783		—		137,701		169		—			137,870
Pension and postretirement benefits, current		—		2,912		—		—			2,912		—		1,734		—		—			1,734
Fees received in advance		—		216,848		37,032		—			253,880		—		243,153		44,418		—			287,571
Intercompany payables		386,610		471,317		202,499		(1,060,426	)		—		285,553		684,401		164,448		(1,134,402	)		—
Federal and foreign taxes payable		—		—		6,441		(6,441	)		—
Income taxes payable													—		—		15,579		(15,579	)		—

Total current liabilities		399,776		985,498		293,852		(1,066,867	)		612,259		308,326		1,143,042		283,749		(1,149,981	)		585,136

Noncurrent liabilities:
Long-term debt		696,878		357,416		101		—			1,054,395		1,044,769		221,734		407		—			1,266,910
Pension and postretirement benefits		—		35,621		—		—			35,621		—		34,405		—		—			34,405
Deferred income taxes, net		—		—		91,837		(49,957	)		41,880		—		—		136,072		(815	)		135,257
Other liabilities		—		51,909		10,597		—			62,506		—		40,665		11,473		—			52,138

Total liabilities		1,096,654		1,430,444		396,387		(1,116,824	)		1,806,661		1,353,095		1,439,846		431,701		(1,150,796	)		2,073,846

Total stockholders’ equity		46,682		548,404		670,433		(1,218,837	)		46,682		365,505		907,591		1,133,602		(2,041,193	)		365,505

Total liabilities and stockholders’ equity	$	1,143,336	$	1,978,848	$	1,066,820	$	(2,335,661	)	$	1,853,343	$	1,718,600	$	2,347,437	$	1,565,303	$	(3,191,989	)	$	2,439,351


														Verisk Analytics, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated
	Verisk Analytics, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated			(In thousands)
ASSETS
Current assets:
Cash and cash equivalents	$	76,238		$	76,813	$	38,552	$	—		$	191,603		$	128	$	35,571	$	54,120	$	—		$	89,819
Available-for-sale securities		—			5,066		—		—			5,066			—		4,883		—		—			4,883
Accounts receivable, net of allowance for doubtful accounts of $4,158		—			128,214		25,125		—			153,339
Accounts receivable, net															—		124,212		54,218		—			178,430
Prepaid expenses		—			20,090		1,815		—			21,905			—		19,340		2,606		—			21,946
Deferred income taxes, net		—			2,557		1,261		—			3,818			—		375		10,022		—			10,397
Federal and foreign income taxes receivable		7,905			23,024		—		(5,687	)		25,242
State and local income taxes receivable		618			10,392		423		—			11,433
Income taxes receivable															15,834		37,180		—		(7,039	)		45,975
Intercompany receivables		250,177			482,172		147,996		(880,345	)		—			424,927		206,165		211,792		(842,884	)		—
Other current assets		—			26,094		15,154		—			41,248			12,008		19,124		7,977		—			39,109

Total current assets		334,938			774,422		230,326		(886,032	)		453,654			452,897		446,850		340,735		(849,923	)		390,559

Noncurrent assets:
Fixed assets, net		—			102,202		17,209		—			119,411			—		126,481		27,603		—			154,084
Intangible assets, net		—			81,828		144,596		—			226,424			—		66,045		454,890		—			520,935
Goodwill		—			481,736		228,208		—			709,944			—		515,705		731,754		—			1,247,459
Deferred income taxes, net		—			50,267		—		(39,787	)		10,480			—		2,584		—		(2,584	)		—
Investment in subsidiaries		601,380			104,430		—		(705,810	)		—			946,612		904,198		—		(1,850,810	)		—
Other assets		6,218			13,059		1,916		—			21,193			13,896		31,801		1,602		—			47,299

Total assets	$	942,536		$	1,607,944	$	622,255	$	(1,631,629	)	$	1,541,106		$	1,413,405	$	2,093,664	$	1,556,584	$	(2,703,317	)	$	2,360,336

LIABILITIES AND STOCKHOLDERS’ (DEFICIT)/EQUITY
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities	$	6,328		$	117,759	$	38,905	$	—		$	162,992		$	14,638	$	113,512	$	59,498	$	—		$	187,648
Acquisition related liabilities		—			—		250		—			250
Short-term debt and current portion of long-term debt		—			5,161		393		—			5,554			—		194,980		283		—			195,263
Pension and postretirement benefits, current		—			4,012		—		—			4,012			—		1,734		—		—			1,734
Fees received in advance		—			152,948		23,894		—			176,842			—		167,962		32,743		—			200,705
Intercompany payables		338,041			354,362		187,942		(880,345	)		—			98,768		575,907		168,209		(842,884	)		—
Federal and foreign income taxes payable		—			—		5,687		(5,687	)		—
Income taxes payable															—		—		7,039		(7,039	)		—

Total current liabilities		344,369			634,242		257,071		(886,032	)		349,650			113,406		1,054,095		267,772		(849,923	)		585,350

Noncurrent liabilities:
Long-term debt		696,657			403,586		89		—			1,100,332			1,044,408		221,706		48		—			1,266,162
Pension and postretirement benefits		—			127,748		—		—			127,748			—		41,282		—		—			41,282
Deferred income taxes, net		—			—		39,787		(39,787	)		—			—		—		136,345		(2,584	)		133,761
Other liabilities		—			58,158		3,708		—			61,866			—		46,892		31,298		—			78,190

Total liabilities		1,041,026			1,223,734		300,655		(925,819	)		1,639,596			1,157,814		1,363,975		435,463		(852,507	)		2,104,745

Total stockholders’ (deficit)/equity		(98,490	)		384,210		321,600		(705,810	)		(98,490	)
Total stockholders’ equity															255,591		729,689		1,121,121		(1,850,810	)		255,591

Total liabilities and stockholders’ (deficit)/equity	$	942,536		$	1,607,944	$	622,255	$	(1,631,629	)	$	1,541,106
Total liabilities and stockholders’ equity														$	1,413,405	$	2,093,664	$	1,556,584	$	(2,703,317	)	$	2,360,336


																Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated			(In thousands)
Revenues	$	—		$	319,254		$	60,782		$	(6,810	)	$	373,226		$	—		$	338,805		$	86,946		$	(4,431	)	$	421,320

Expenses:
Cost of revenues (exclusive of items shown separately below)		—			121,813			28,828			(3,567	)		147,074			—			134,191			42,497			(2,025	)		174,663
Selling, general and administrative		—			51,202			14,514			(3,243	)		62,473			—			49,272			14,286			(2,406	)		61,152
Depreciation and amortization of fixed assets		—			10,817			2,273			—			13,090			—			13,475			3,336			—			16,811
Amortization of intangible assets		—			4,892			7,295			—			12,187			—			4,659			12,537			—			17,196

Total expenses		—			188,724			52,910			(6,810	)		234,824			—			201,597			72,656			(4,431	)		269,822

Operating income		—			130,530			7,872			—			138,402			—			137,208			14,290			—			151,498

Other income/(expense):
Investment income		18			26			112			—			156
Realized loss on securities, net		—			(30	)		—			—			(30	)

Other income (expense):
Interest expense		(9,875	)		(7,488	)		(14	)		—			(17,377	)		(13,639	)		(6,031	)		(34	)		—			(19,704	)
Investment income (loss)																	5			44			(9	)		—			40
Realized gain on available-for-sale securities, net																	—			93			—			—			93

Total other (expense)/income, net		(9,857	)		(7,492	)		98			—			(17,251	)
Total other expense, net																	(13,634	)		(5,894	)		(43	)		—			(19,571	)

(Loss)/income before equity in net income of subsidiaries and income taxes		(9,857	)		123,038			7,970			—			121,151
(Loss) income before equity in net income of subsidiaries and income taxes																	(13,634	)		131,314			14,247			—			131,927
Equity in net income of subsidiaries		79,571			2,967			—			(82,538	)		—			92,805			6,592			—			(99,397	)		—
Provision for income taxes		3,617			(48,475	)		(2,962	)		—			(47,820	)		5,034			(47,807	)		(4,949	)		—			(47,722	)

Net income	$	73,331		$	77,530		$	5,008		$	(82,538	)	$	73,331		$	84,205		$	90,099		$	9,298		$	(99,397	)	$	84,205


																Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated			(In thousands)
Revenues	$	—		$	626,353		$	104,383		$	(11,009	)	$	719,727		$	—		$	667,831		$	166,166		$	(9,354	)	$	824,643

Expenses:
Cost of revenues (exclusive of items shown separately below)		—			238,152			48,200			(5,948	)		280,404			—			260,759			82,712			(4,359	)		339,112
Selling, general and administrative		—			94,539			26,974			(5,061	)		116,452			—			96,169			29,006			(4,995	)		120,180
Depreciation and amortization of fixed assets		—			20,368			4,366			—			24,734			—			25,568			6,457			—			32,025
Amortization of intangible assets		—			9,820			10,954			—			20,774			—			9,339			25,064			—			34,403

Total expenses		—			362,879			90,494			(11,009	)		442,364			—			391,835			143,239			(9,354	)		525,720

Operating income		—			263,474			13,889			—			277,363			—			275,996			22,927			—			298,923

Other income/(expense):

Other income (expense):
Interest expense																	(27,276	)		(12,479	)		(39	)		—			(39,794	)
Investment income		36			100			125			—			261			5			44			39			—			88
Realized gain on securities, net		—			300			—			—			300
Interest expense		(19,744	)		(13,995	)		(23	)		—			(33,762	)
Realized loss on available-for-sale securities, net																	—			(100	)		—			—			(100	)

Total other (expense)/income, net		(19,708	)		(13,595	)		102			—			(33,201	)
Total other expense, net																	(27,271	)		(12,535	)		—			—			(39,806	)

(Loss)/income before equity in net income of subsidiaries and income taxes		(19,708	)		249,879			13,991			—			244,162
(Loss) income before equity in net income of subsidiaries and income taxes																	(27,271	)		263,461			22,927			—			259,117
Equity in net income of subsidiaries		160,407			3,253			—			(163,660	)		—			181,940			7,865			—			(189,805	)		—
Provision for income taxes		7,233			(96,795	)		(6,668	)		—			(96,230	)		10,047			(94,299	)		(10,149	)		—			(94,401	)

Net income	$	147,932		$	156,337		$	7,323		$	(163,660	)	$	147,932		$	164,716		$	177,027		$	12,778		$	(189,805	)	$	164,716


																Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated			(In thousands)
Revenues	$	—		$	289,353		$	43,842		$	(5,915	)	$	327,280		$	—		$	319,254		$	60,782		$	(6,810	)	$	373,226

Expenses:
Cost of revenues (exclusive of items shown separately below)		—			114,120			19,906			(2,841	)		131,185			—			121,813			28,828			(3,567	)		147,074
Selling, general and administrative		—			45,936			13,047			(3,074	)		55,909			—			51,202			14,514			(3,243	)		62,473
Depreciation and amortization of fixed assets		—			8,739			2,116			—			10,855			—			10,817			2,273			—			13,090
Amortization of intangible assets		—			4,797			4,080			—			8,877			—			4,892			7,295			—			12,187
Acquisition related liabilities adjustment		—			(2,800	)		(564	)		—			(3,364	)

Total expenses		—			170,792			38,585			(5,915	)		203,462			—			188,724			52,910			(6,810	)		234,824

Operating income		—			118,561			5,257			—			123,818			—			130,530			7,872			—			138,402

Other income/(expense):
Investment income/(loss)		—			1,457			(38	)		(1,429	)		(10	)
Realized gain on securities, net		—			125			—			—			125

Other income (expense):
Interest expense		(7,681	)		(8,562	)		(71	)		1,429			(14,885	)		(9,875	)		(7,488	)		(14	)		—			(17,377	)
Investment income																	18			26			112			—			156
Realized loss on available-for-sale securities, net																	—			(30	)		—			—			(30	)

Total other expense, net		(7,681	)		(6,980	)		(109	)		—			(14,770	)
Total other (expense) income, net																	(9,857	)		(7,492	)		98			—			(17,251	)

(Loss)/income before equity in net income of subsidiaries and income taxes		(7,681	)		111,581			5,148			—			109,048
Equity in net income of subsidiaries		70,428			2,702			—			(73,130	)		—
(Loss) income before equity in net income of subsidiary and income taxes																	(9,857	)		123,038			7,970			—			121,151
Equity in net income of subsidiary																	79,571			2,967			—			(82,538	)		—
Provision for income taxes		2,830			(44,525	)		(1,776	)		—			(43,471	)		3,617			(48,475	)		(2,962	)		—			(47,820	)

Net income	$	65,577		$	69,758		$	3,372		$	(73,130	)	$	65,577		$	73,331		$	77,530		$	5,008		$	(82,538	)	$	73,331


CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS (UNAUDITED) For The Six Month Period Ended June 30, 2011

	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
Revenues	$	—		$	568,933		$	78,964		$	(7,748	)	$	640,149

Expenses:
Cost of revenues (exclusive of items shown separately below)		—			222,903			36,659			(3,821	)		255,741
Selling, general and administrative		—			82,414			26,678			(3,927	)		105,165
Depreciation and amortization of fixed assets		—			18,181			3,979			—			22,160
Amortization of intangible assets		—			10,117			7,215			—			17,332
Acquisition related liabilities adjustment		—			(2,800	)		(564	)		—			(3,364	)

Total expenses		—			330,815			73,967			(7,748	)		397,034

Operating income		—			238,118			4,997			—			243,115

Other income/(expense):
Investment income/(loss)		—			1,471			(42	)		(1,429	)		—
Realized gain on securities, net		—			487			—			—			487
Interest expense		(7,681	)		(18,157	)		(91	)		1,429			(24,500	)

Total other expense, net		(7,681	)		(16,199	)		(133	)		—			(24,013	)

(Loss)/income before equity in net income of subsidiaries and income taxes		(7,681	)		221,919			4,864			—			219,102
Equity in net income of subsidiaries		136,304			1,614			—			(137,918	)		—
Provision for income taxes		2,830			(88,078	)		(2,401	)		—			(87,649	)

Net income	$	131,453		$	135,455		$	2,463		$	(137,918	)	$	131,453


																Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated			(In thousands)
Net income	$	73,331		$	77,530		$	5,008		$	(82,538	)	$	73,331		$	73,331		$	77,530		$	5,008		$	(82,538	)	$	73,331

Other comprehensive income, net of tax:
Unrealized holding loss on investments		(116	)		(116	)		—			116			(116	)
Unrealized foreign currency loss		(287	)		(248	)		(254	)		502			(287	)		(287	)		(248	)		(254	)		502			(287	)
Unrealized holding loss on available-for-sale securities																	(116	)		(116	)		—			116			(116	)
Pension and postretirement unfunded liability adjustment		452			452			—			(452	)		452			452			452			—			(452	)		452

Total other comprehensive income		49			88			(254	)		166			49			49			88			(254	)		166			49

Comprehensive income	$	73,380		$	77,618		$	4,754		$	(82,372	)	$	73,380		$	73,380		$	77,618		$	4,754		$	(82,372	)	$	73,380


															Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Eliminating Entries			Consolidated			(In thousands)
Net income	$	131,453		$	135,455		$	2,463	$	(137,918	)	$	131,453		$	147,932		$	156,337		$	7,323		$	(163,660	)	$	147,932

Other comprehensive income, net of tax:
Unrealized holding loss on investments		(252	)		(252	)		—		252			(252	)
Unrealized foreign currency gain		573			358			612		(970	)		573
Unrealized foreign currency loss																(134	)		(96	)		(113	)		209			(134	)
Unrealized holding loss on available-for-sale securities																(313	)		(313	)		—			313			(313	)
Pension and postretirement unfunded liability adjustment		1,974			1,974			—		(1,974	)		1,974			1,380			1,380			—			(1,380	)		1,380

Total other comprehensive income		2,295			2,080			612		(2,692	)		2,295			933			971			(113	)		(858	)		933

Comprehensive income	$	133,748		$	137,535		$	3,075	$	(140,610	)	$	133,748		$	148,865		$	157,308		$	7,210		$	(164,518	)	$	148,865


	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated			Verisk Analytics, Inc.		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
Net cash (used in)/provided by operating activities	$	(13,015	)	$	143,124		$	57,326		$	—		$	187,435
																(In thousands)
Net cash provided by operating activities																$	—	$	145,306		$	101,385		$	—		$	246,691

Cash flows from investing activities:
Acquisitions, net of cash acquired of $29,387		—			(331,330	)		—			—			(331,330	)
Earnout payments		—			—			(250	)		—			(250	)
Purchase of non-controlling equity investments in non-public companies		—			(2,000	)		—			—			(2,000	)
Escrow funding associated with acquisitions		—			(17,000	)		—			—			(17,000	)
Acquisitions, net of cash acquired of $0																	—		(983	)		—			—			(983	)
Proceeds from release of acquisition related escrows																	61		131			—			—			192
Repayments received from other subsidiaries		12,100			148,000			—			(160,100	)		—			—		81,096			8,363			(89,459	)		—
Advances provided to other subsidiaries		—			(33,475	)		—			33,475			—			—		(44,800	)		—			44,800			—
Purchases of fixed assets		—			(30,002	)		(6,530	)		—			(36,532	)		—		(49,103	)		(14,402	)		—			(63,505	)
Purchases of available-for-sale securities		—			(1,128	)		—			—			(1,128	)		—		(4,967	)		—			—			(4,967	)
Proceeds from sales and maturities of available-for-sale securities		—			1,203			—			—			1,203			—		5,826			—			—			5,826
Other investing, net																	—		439			—			—			439

Net cash provided by/(used in) investing activities		12,100			(265,732	)		(6,780	)		(126,625	)		(387,037	)
Net cash provided by (used in) investing activities																	61		(12,361	)		(6,039	)		(44,659	)		(62,998	)

Cash flows from financing activities:
Proceeds from short-term debt, net		—			150,000			—			—			150,000
Repurchase of Verisk Class A common stock		—			(106,305	)		—			—			(106,305	)
Repayment of current portion of long-term debt																	—		(45,000	)		—			—			(45,000	)
Repayments of short-term debt, net																	—		(10,000	)		—			—			(10,000	)
Excess tax benefits from exercised stock options																	—		63,934			—			—			63,934
Repurchase of common stock																	—		(135,595	)		—			—			(135,595	)
Proceeds from stock options exercised																	—		30,528			—			—			30,528
Repayment of advances to other subsidiaries		(75,000	)		(12,100	)		(73,000	)		160,100			—			—		(8,363	)		(81,096	)		89,459			—
Advances received from other subsidiaries		188			—			33,287			(33,475	)		—			40,000		—			4,800			(44,800	)		—
Excess tax benefits from exercised stock options		—			31,624			—			—			31,624
Proceeds from stock options exercised		—			33,453			—			—			33,453
Other financing, net		—			(3,127	)		(314	)		—			(3,441	)
Other financing activities, net																	—		(3,929	)		(182	)		—			(4,111	)

Net cash (used in)/provided by financing activities		(74,812	)		93,545			(40,027	)		126,625			105,331
Net cash provided by (used in) financing activities																	40,000		(108,425	)		(76,478	)		44,659			(100,244	)

Effect of exchange rate changes		—			(21	)		(113	)		—			(134	)		—		(79	)		(602	)		—			(681	)

(Decrease)/increase in cash and cash equivalents		(75,727	)		(29,084	)		10,406			—			(94,405	)

Increase in cash and cash equivalents																	40,061		24,441			18,266			—			82,768
Cash and cash equivalents, beginning of period		76,238			76,813			38,552			—			191,603			128		35,571			54,120			—			89,819

Cash and cash equivalents, end of period	$	511		$	47,729		$	48,958		$	—		$	97,198		$	40,189	$	60,012		$	72,386		$	—		$	172,587

Supplemental disclosures:
Increase in intercompany balances from the purchase of MediConnect by ISO	$	17,000		$	348,330		$	331,330		$	—		$	—

Increase in intercompany balances from the purchase of treasury stock by Verisk funded directly by ISO	$	106,305		$	106,305		$	—		$	—		$	—		$	135,595	$	135,595		$	—		$	—		$	—

Increase in intercompany balances from proceeds received by ISO related to issuance of Verisk common stock from options exercised	$	33,453		$	33,453		$	—		$	—		$	—		$	30,528	$	30,528		$	—		$	—		$	—

~~16. Subsequent Event:~~


	Verisk Analytics, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminating Entries			Consolidated
	(In thousands)
Net cash (used in) provided by operating activities	$	(13,015	)	$	143,124		$	57,326		$	—		$	187,435

Cash flows from investing activities:
Acquisitions, net of cash acquired of $29,387		—			(331,330	)		—			—			(331,330	)
Purchase of non-controlling interest in non-public companies		—			(2,000	)		—			—			(2,000	)
Earnout payments		—			—			(250	)		—			(250	)
Escrow funding associated with acquisitions		—			(17,000	)		—			—			(17,000	)
Repayments received from other subsidiaries		12,100			148,000			—			(160,100	)		—
Advances provided to other subsidiaries		—			(33,475	)		—			33,475			—
Purchases of fixed assets		—			(30,002	)		(6,530	)		—			(36,532	)
Purchases of available-for-sale securities		—			(1,128	)		—			—			(1,128	)
Proceeds from sales and maturities of available-for-sale securities		—			1,203			—			—			1,203

Net cash provided by (used in) investing activities		12,100			(265,732	)		(6,780	)		(126,625	)		(387,037	)

Cash flows from financing activities:
Proceeds of short-term debt, net		—			150,000			—			—			150,000
Excess tax benefits from exercised stock options		—			31,624			—			—			31,624
Repurchase of common stock		—			(106,305	)		—			—			(106,305	)
Proceeds from stock options exercised		—			33,453			—			—			33,453
Repayments of advances to other subsidiaries		(75,000	)		(12,100	)		(73,000	)		160,100			—
Advances received from other subsidiaries		188			—			33,287			(33,475	)		—
Other financing activities, net		—			(3,127	)		(314	)		—			(3,441	)

Net cash (used in) provided by financing activities		(74,812	)		93,545			(40,027	)		126,625			105,331

Effect of exchange rate changes		—			(21	)		(113	)		—			(134	)

(Decrease) increase in cash and cash equivalents		(75,727	)		(29,084	)		10,406			—			(94,405	)
Cash and cash equivalents, beginning of period		76,238			76,813			38,552			—			191,603

Cash and cash equivalents, end of period	$	511		$	47,729		$	48,958		$	—		$	97,198

Supplemental disclosures:
Increase in intercompany balances from the purchase of MediConnect by ISO	$	17,000		$	348,330		$	331,330		$	—		$	—

Increase in intercompany balances from the purchase of treasury stock by Verisk funded directly by ISO	$	106,305		$	106,305		$	—		$	—		$	—

Increase in intercompany balances from proceeds received by ISO related to issuance of Verisk common stock from options exercised	$	33,453		$	33,453		$	—		$	—		$	—

On July 2, 2012, the Company acquired the net assets of Aspect Loss Prevention, LLC (“ALP”), a provider of loss prevention and analytic solutions to the retail, entertainment, and food industries, for a net cash purchase price of approximately $6,917 and funded $800 of indemnity escrows. This acquisition further advances the Company’s position within the Decision Analytics segment as a provider of data, analytics, and decision–support solutions in the insurance industry. The cash paid will be adjusted subsequent to close to reflect final balances of certain working capital accounts and other closing adjustments. Due to the limited time since the acquisition date and limitations on access to ALP information prior to the acquisition date, the initial accounting for the business combination is incomplete at this time. As a result, the Company is unable to provide amounts recognized as of the acquisition date for major classes of assets and liabilities acquired and resulting from the transaction, including the information required for contingencies, intangible assets and goodwill. This information will be included in the quarterly report on Form 10-Q for the nine months ending September 30, 2012.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our historical financial statements and the related notes included in our annual report on Form 10-K, or 2012 10-K, dated and filed with the Securities and Exchange Commission on February ~~28, 2012.~~26, 2013. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in or implied by any of the forward-looking statements as a result of various ~~factors.~~factors, including but not limited to those listed under “Risk Factors” and “Special Note Regarding Forward Looking Statements” in our 2012 10-K.

We enable risk-bearing businesses to better understand and manage their risks. We provide value to our customers by supplying proprietary data that, combined with our analytic methods, creates embedded decision support solutions. We are the largest aggregator and provider of data pertaining to U.S. property and casualty, or P&C, insurance risks. We offer solutions for detecting fraud in the U.S. P&C insurance, ~~mortgage~~financial services and healthcare industries and sophisticated methods to predict and quantify loss in diverse contexts ranging from natural catastrophes to supply chain to health insurance.

Our customers use our solutions to make better risk decisions with greater efficiency and discipline. We refer to these products and services as ~~solutions~~“solutions” due to the integration among our products and the flexibility that enables our customers to purchase components or the comprehensive package of products. These solutions take various forms, including data, statistical models or tailored analytics, all designed to allow our clients to make more logical decisions. We believe our solutions for analyzing risk positively impact our customers’ revenues and help them better manage their costs.

We organize our business in two segments: Risk Assessment and Decision Analytics. Our Risk Assessment segment provides statistical, actuarial and underwriting data for the U.S. P&C insurance industry. Our Risk Assessment segment revenues represented approximately ~~40%~~37% and ~~44%~~40% of our revenues for the six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, respectively. Our Decision Analytics segment provides solutions to our customers ~~use to analyze the processes~~within four vertical market-related groupings of ~~the Verisk Risk Analytics Framework: loss prediction, fraud identification~~insurance, financial services, healthcare, and ~~detection, and loss quantification.~~specialized markets. Our Decision Analytics segment revenues represented approximately ~~60%~~63% and ~~56%~~60% of our revenues for the six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, respectively.

We believe our business’s ability to generate recurring revenue and positive cash flow is the key indicator of the successful execution of our business strategy. We use year-over-year revenue growth and EBITDA margin as metrics to measure our performance. EBITDA and EBITDA margin are non-GAAP financial measures within the meaning of Regulation G under the Securities Exchange Act of 1934 (See footnote 1 within the Condensed Consolidated Results of Operations section of Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations).

Revenue growth. We use year-over-year revenue growth as a key performance metric. We assess revenue growth based on our ability to generate increased revenue through increased sales to existing customers, sales to new customers, sales of new or expanded solutions to existing and new customers, and strategic acquisitions of new businesses.

EBITDA margin. We use EBITDA margin as a metric to assess segment performance and scalability of our business. We assess EBITDA margin based on our ability to increase revenues while controlling expense growth.

We earn revenues through subscriptions, long-term agreements and on a transactional basis. Subscriptions for our solutions are generally paid in advance of rendering services either quarterly or in full upon commencement of the subscription period, which is usually for one year and automatically renewed each year.

As a result, the timing of our cash flows generally precedes our recognition of revenues and income and our cash flow from operations tends to be higher in the first quarter as we receive subscription payments. Examples of these arrangements include subscriptions that allow our customers to access our standardized coverage language, our claims fraud database or our actuarial services throughout the subscription period. For our subscriptions arrangements, we experience minimal revenue seasonality within the business. Our long-term agreements are generally for periods of three to ~~seven~~five years. We recognize revenue from subscriptions ratably over the term of the subscription and most long-term agreements are recognized ratably over the term of the agreement.

Certain of our solutions are also paid for by our customers on a transactional basis. For example, we have solutions that allow our customers to access fraud detection tools in the context of an individual mortgage application or loan, obtain property-specific rating and underwriting information to price a policy on a commercial building, or compare a P&C insurance, medical or workers’ compensation claim with information in our databases. For ~~each of six-month periods~~the six months ended June 30, 2013 and 2012, approximately 32% and ~~2011,~~ 31% of our revenues, respectively, were derived from providing transactional solutions. We earn transactional revenues as our solutions are delivered or services performed. In general, transactions are billed monthly at the end of each month.

Approximately ~~87%~~88% and ~~84%~~87% of the revenues in our Risk Assessment segment for the ~~six-month periods~~six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, respectively, were derived from subscriptions and long-term agreements for our solutions. Our customers in this segment include most of the P&C insurance providers in the United States. Approximately 57% of the revenues in our Decision Analytics segment, for ~~each of~~both the ~~six-month periods~~six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, were derived from subscriptions and long-term agreements for our solutions. In this segment, our ~~tools service~~customer bases are within the insurance, healthcare, ~~mortgage and~~ financial services, and specialized markets verticals.

Personnel expenses are the major component of both our cost of revenues and selling, general and administrative expenses. Personnel expenses include salaries, benefits, incentive compensation, equity compensation costs, ~~(described under “Equity Compensation Costs” below),~~ sales commissions, employment taxes, recruiting costs, and outsourced temporary agency costs, which represented ~~65%~~62% and ~~66%~~65% of our total expenses for the six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, respectively.

We allocate personnel expenses between two categories, cost of revenues and selling, general and administrative ~~costs,~~expense, based on the actual costs associated with each employee. We categorize employees who maintain our solutions as cost of revenues, and all other personnel, including executive managers, sales people, marketing, business development, finance, legal, human resources, and administrative services, as selling, general and administrative expenses. A significant portion of our other operating costs, such as facilities and communications, is also either captured within cost of revenues or selling, general and administrative ~~expense~~expenses based on the nature of the work being performed.

While we expect to grow our headcount over time to take advantage of our market opportunities, we believe that the economies of scale in our operating model will allow us to grow our personnel expenses at a lower rate than revenues. Historically, our EBITDA margin has improved because we have been able to increase revenues without a proportionate corresponding increase in expenses. However, part of our corporate strategy is to invest in new solutions which may offset margin expansion.

Cost of Revenues. Our cost of revenues consists primarily of personnel expenses. Cost of revenues also includes the expenses associated with the acquisition and verification of data, the maintenance of our existing solutions and the development and enhancement of our next-generation solutions. Our cost of revenues excludes depreciation and amortization.

Selling, General and Administrative Expense. Our selling, general and administrative ~~expense~~expenses also ~~consists~~consist primarily of personnel costs. A portion of the other operating costs such as facilities, insurance and communications ~~are~~is also allocated to selling, general and administrative ~~costs~~expenses based on the nature of the work being performed by the employee. Our selling, general and administrative ~~expense excludes~~expenses exclude depreciation and amortization.

~~We acquired four businesses since January 1, 2011.~~ As a result of ~~these~~the below acquisitions, our consolidated results of operations may not be comparable between periods. See Note 5 in our condensed consolidated financial statements included in this quarterly report on Form 10-Q for ~~further~~more information.

On December 20, 2012, we acquired the net assets of Insurance Risk Management Solutions, or IRMS. IRMS provided integrated property risk assessment technology underlying one of our GIS (geographic information system) underwriting solutions. At the end of 2012, the long-term contract (since 1992) with IRMS was expiring and precipitated a change in our business relationship. Instead of continuing forward with a new services agreement, we acquired the technology and service assets of IRMS as this will enable us to better manage, enhance and continue to use the solutions as part of our Risk Assessment segment.

On August 31, 2012, we acquired Argus Information & Advisory Services, LLC, or Argus, a provider of information, competitive benchmarking, scoring solutions, analytics, and customized services to financial institutions and regulators in North America, Latin America, and Europe. Argus leverages its comprehensive payment data sets and provides proprietary solutions to a client base that includes credit and debit card issuers, retail banks and other consumer financial services providers, payment processors, insurance companies and other industry stakeholders. Within our Decision Analytics segment, this acquisition enhances our position as a provider of data, analytics, and decision-support solutions to financial institutions globally.

On July 2, 2012, we acquired the net assets of Aspect Loss Prevention, LLC, or ALP, a provider of loss prevention and analytic solutions to the retail, entertainment, and food industries. Within our Decision Analytics segment, this acquisition further advances our position as a provider of data, crime analytics, and decision-support ~~solutions in the insurance industry. Due to the timing of this acquisition, there was no impact on our income statement for ALP for the three and six months ended June 30, 2012.~~solutions.

On March 30, 2012, we acquired 100% of the stock of MediConnect Global, Inc., or MediConnect, a service provider of medical record retrieval, digitization, coding, extraction, and analysis. Within our Decision Analytics segment, MediConnect further supports our objective to be the leading provider of data, analytics, and decision-support solutions to the healthcare and property casualty industries.

On June 17, 2011, we acquired the net assets of Health Risk Partners, LLC, or HRP, a provider of solutions to optimize revenue, ensure compliance and improve quality of care for Medicare Advantage and Medicaid health plans. Within our Decision Analytics segment, this acquisition further advances our position as a major provider of data, analytics, and decision-support solutions to the healthcare industry.

On April 27, 2011, we acquired 100% of the common stock of Bloodhound Technologies, Inc. or Bloodhound, a provider of real-time pre-adjudication medical claims editing. Within our Decision Analytics segment, Bloodhound addresses the need of healthcare payers to control fraud and waste in a real-time claims-processing environment, and these capabilities align with our existing fraud identification tools in the healthcare vertical market.

We have a leveraged ESOP, funded with intercompany debt that includes 401(k), ESOP and profit sharing components to provide employees with equity participation. We make quarterly cash contributions to the plan equal to the debt service requirements. As the debt is repaid, shares are released to the ESOP to fund 401(k) matching and profit sharing contributions and the remainder is allocated annually to active employees in proportion to their eligible compensation in relation to total participants’ eligible compensation. We had no ESOP allocation expense for the six months ended June 30, 2012 and 2011. We accrue compensation expense over the reporting period equal to the fair value of the ESOP loan collateral to be released to the ESOP.

~~The amount of our equity compensation costs recognized for the three and six months ended June 30, 2012 and 2011 is as follows:~~

In addition, the portion of the ESOP allocation expense related to the appreciation of the value of the shares in the ESOP above the value of those shares when the ESOP was first established is not tax deductible.

Under the terms of our approved equity compensation plans, stock options and other equity awards may be granted to employees. Prior to our IPO, we granted to key employees nonqualified stock options covered under the Insurance Services Office, Inc. 1996 Incentive Plan, or the Option Plan. Subsequent to the IPO, equity awards, including nonqualified stock options and restricted stock, granted to key employees are covered under the Verisk Analytics, Inc. 2009 Equity Incentive Plan, or the Incentive Plan. All of our outstanding stock options and restricted stock are covered under the Incentive Plan or the Option Plan. See Note 10 in our condensed consolidated financial statements included in this quarterly report on Form 10-Q.

We follow the substantive vesting period approach for awards granted after January 1, 2005, which requires that stock based compensation expense be recognized over the period from the date of grant to the date when the award is no longer contingent on the employee providing additional service. For the three months ended June 30, 2012 and 2011, we recognized $4.4 million and $4.2 million in stock based compensation as a result of accelerated expense recognition on the equity awards granted on April 1, 2012 and 2011, respectively, because such awards were no longer contingent on the employee providing additional service based on our retirement qualifications.

On May 16, 2012, our stockholder’s approved the implementation of an employee stock purchase plan, or ESPP. The ESPP will commence on October 1, 2012 and offer eligible employees the opportunity to authorize payroll deductions of up to 20.0% of their regular base salary and up to 50.0% of their short-term incentive compensation, both of which in total may not exceed twenty five thousand dollars in any calendar year, to purchase shares of our Class A common stock at a 5.0% discount of its fair market value at the time of purchase. The ESPP is noncompensatory as the purchase discount is 5.0% or less from the fair market value, substantially all employees that meet limited employment qualifications may participate, and it incorporates no option features.


		Three Months Ended June 30,						Percent			Six Months Ended June 30,						Percent				Three Months Ended June 30,						Percentage Change				Six Months Ended June 30,							Percentage Change
		2012			2011			Change			2012			2011			Change				2013			2012						2013				2012				Percentage Change
		(In thousands, except for share and per share data)																			(In thousands, except for share and per share data)
Statement of income data:																											Percentage Change
Revenues :
Revenues:
Decision Analytics revenues																					$	267,061		$	229,037			16.6	%		$	517,771			$	430,569			20.3	%
Risk Assessment revenues		$	144,189		$	140,530			2.6	%	$	289,158		$	281,073			2.9	%			154,259			144,189			7.0	%			306,872				289,158			6.1	%
Decision Analytics revenues			229,037			186,750			22.6	%		430,569			359,076			19.9	%

Revenues			373,226			327,280			14.0	%		719,727			640,149			12.4	%			421,320			373,226			12.9	%			824,643				719,727			14.6	%

Expenses:
Cost of revenues (exclusive of items shown separately below)			147,074			131,185			12.1	%		280,404			255,741			9.6	%			174,663			147,074			18.8	%			339,112				280,404			20.9	%
Selling, general and administrative			62,473			55,909			11.7	%		116,452			105,165			10.7	%			61,152			62,473			(2.1	)%			120,180				116,452			3.2	%
Depreciation and amortization of fixed assets			13,090			10,855			20.6	%		24,734			22,160			11.6	%			16,811			13,090			28.4	%			32,025				24,734			29.5	%
Amortization of intangible assets			12,187			8,877			37.3	%		20,774			17,332			19.9	%			17,196			12,187			41.1	%			34,403				20,774			65.6	%
Acquisition related liabilities adjustment			—			(3,364	)		(100.0	)%		—			(3,364	)		(100.0	)%

Total expenses			234,824			203,462			15.4	%		442,364			397,034			11.4	%			269,822			234,824			14.9	%			525,720				442,364			18.8	%

Operating income			138,402			123,818			11.8	%		277,363			243,115			14.1	%			151,498			138,402			9.5	%			298,923				277,363			7.8	%

Other income/(expense):
Investment income/(loss)			156			(10	)		(1660.0	)%		261			—			100.0	%
Realized (loss)/gain on securities, net			(30	)		125			(124.0	)%		300			487			(38.4	)%
Interest expense			(17,377	)		(14,885	)		16.7	%		(33,762	)		(24,500	)		37.8	%			(19,704	)		(17,377	)		13.4	%			(39,794	)			(33,762	)		17.9	%
Investment income																						40			156			(74.4	)%			88				261			(66.3	)%
Realized gain (loss) on available-for-sale securities, net																						93			(30	)		(410.0	)%			(100	)			300			(133.3	)%

Total other expense, net			(17,251	)		(14,770	)		16.8	%		(33,201	)		(24,013	)		38.3	%			(19,571	)		(17,251	)		13.4	%			(39,806	)			(33,201	)		19.9	%

Income before income taxes			121,151			109,048			11.1	%		244,162			219,102			11.4	%			131,927			121,151			8.9	%			259,117				244,162			6.1	%
Provision for income taxes			(47,820	)		(43,471	)		10.0	%		(96,230	)		(87,649	)		9.8	%			(47,722	)		(47,820	)		(0.2	)%			(94,401	)			(96,230	)		(1.9	)%

Net income		$	73,331		$	65,577			11.8	%	$	147,932		$	131,453			12.5	%		$	84,205		$	73,331			14.8	%		$	164,716			$	147,932			11.3	%

Basic net income per share		$	0.44		$	0.39			12.8	%	$	0.89		$	0.78			14.1	%		$	0.50		$	0.44			13.6	%		$	0.98			$	0.89			10.1	%

Diluted net income per share		$	0.43		$	0.38			13.2	%	$	0.86		$	0.75			14.7	%		$	0.49		$	0.43			14.0	%		$	0.95			$	0.86			10.5	%

Weighted average shares outstanding:
Basic			165,946,009			166,960,806			(0.6	)%		165,391,500			167,995,517			(1.6	)%			168,147,069			165,946,009			1.3	%			168,112,829				165,391,500			1.6	%

Diluted			171,901,349			174,634,046			(1.6	)%		171,626,084			175,799,120			(2.4	)%			172,467,688			171,901,349			0.3	%			172,614,164				171,626,084			0.6	%


The financial operating data below sets forth the information we believe is useful for investors in evaluating our overall financial performance:	The financial operating data below sets forth the information we believe is useful for investors in evaluating our overall financial performance:																			The financial operating data below sets forth the information we believe is useful for investors in evaluating our overall financial performance:

Other data:
EBITDA (1):
Decision Analytics EBITDA																					$	99,308		$	87,706			13.2	%		$	192,931			$	166,963			15.6	%
Risk Assessment EBITDA		$	76,099		$	68,247			11.5	%	$	156,469		$	142,778			9.6	%			86,330			76,099			13.4	%			172,408				156,469			10.2	%
Decision Analytics EBITDA			87,706			75,418			16.3	%		166,963			140,316			19.0	%

EBITDA		$	163,805		$	143,665			14.0	%	$	323,432		$	283,094			14.2	%		$	185,638		$	163,805			13.3	%		$	365,339			$	323,432			13.0	%

The following is a reconciliation of net income to EBITDA:
Net income		$	73,331		$	65,577			11.8	%	$	147,932		$	131,453			12.5	%		$	84,205		$	73,331			14.8	%		$	164,716			$	147,932			11.3	%
Depreciation and amortization			25,277			19,732			28.1	%		45,508			39,492			15.2	%			34,007			25,277			34.5	%			66,428				45,508			46.0	%
Interest expense			17,377			14,885			16.7	%		33,762			24,500			37.8	%			19,704			17,377			13.4	%			39,794				33,762			17.9	%
Provision for income taxes			47,820			43,471			10.0	%		96,230			87,649			9.8	%			47,722			47,820			(0.2	)%			94,401				96,230			(1.9	)%

EBITDA		$	163,805		$	143,665			14.0	%	$	323,432		$	283,094			14.2	%		$	185,638		$	163,805			13.3	%		$	365,339			$	323,432			13.0	%

Although EBITDA is a non-GAAP financial measure, EBITDA is frequently used by securities analysts, lenders and others in their evaluation of companies. EBITDA has limitations as an analytical tool, and should not be considered in isolation, or as a substitute for an analysis of our results of operations or cash flows from operating activities reported under GAAP. Management uses EBITDA in conjunction with traditional GAAP operating performance measures as part of its overall assessment of company performance. Some of these limitations are:

Six Months Ended June 30, ~~2012~~2013 Compared to Six Months Ended June 30, ~~2011~~2012

Revenues were $824.6 million for the six months ended June 30, 2013 compared to $719.7 million for the six months ended June 30, 2012, ~~compared to $640.1 million for the six months ended June 30, 2011,~~ an increase of ~~$79.6~~$104.9 million or ~~12.4%~~14.6%. In 2012, ~~and 2011,~~ we acquired ~~three~~the following companies, ~~Bloodhound, HRP,~~MediConnect, ALP, and ~~MediConnect,~~Argus, collectively referred to as recent acquisitions, which we define as acquisitions not owned for a significant portion of both the current period and/or prior period and would therefore impact the comparability of the financial results. ~~Recent~~MediConnect was noted as a recent acquisition only for the first quarter of 2013 as a full quarter comparable exists as of the second quarter of 2013. These recent acquisitions were within our Decision Analytics segment ~~in the healthcare category~~ and provided an increase of ~~$34.8~~$52.4 million in revenues for the six months ended June 30, ~~2012.~~ 2013.

Excluding recent acquisitions, revenues increased ~~$44.8~~$52.5 million or ~~7.0%~~7.3%, which included an increase in our Decision Analytics segment of ~~$36.7~~$34.8 million or 8.1% and an increase in our Risk Assessment segment of ~~$8.1 million.~~$17.7 million or 6.1%. Revenue growth within Decision Analytics was primarily driven by strong increases in our healthcare revenue category and contributions from our insurance revenue category, offset by a decrease in our financial services revenue category, due to our mortgage services. Revenue growth within Risk Assessment was primarily driven by our industry-standard insurance programs. Refer to the Results of Operations by Segment within this section for further information regarding our revenues.

Cost of revenues was $339.1 million for the six months ended June 30, 2013 compared to $280.4 million for the six months ended June 30, 2012, ~~compared to $255.7 million for the six months ended June 30, 2011,~~ an increase of ~~$24.7~~$58.7 million or ~~9.6%~~20.9%. Recent acquisitions ~~all within our Decision Analytics segment,~~ accounted for an increase of ~~$17.6~~$28.8 million in ~~cost of revenues,~~costs, which were primarily ~~due to expenses~~ related to salaries and employee ~~benefit costs.~~benefits. Excluding the impact of our recent acquisitions, our cost of revenues increased ~~$7.1~~$29.9 million or ~~2.8%~~10.7%. The increase was primarily due to increases in salaries and employee ~~benefit costs~~benefits cost of ~~$4.9~~$20.0 million. Other increases include ~~rent and maintenance office expenses~~data costs of ~~$1.1~~$4.2 million, information technology expenses of ~~$1.1~~$3.4 million, travel and travel related costs of ~~$0.2~~$1.1 million and other operating expenses of ~~$0.6~~$1.2 million. ~~These increases in costs were partially offset by a $0.8 million decrease in data related costs.~~

The increase in salaries and employee benefits of $4.9 million includes an increase of $9.7 million in annual salaries and employee benefits, medical costs, and long term equity compensation plan costs, and was partially offset by a decrease of $4.8 million in pension cost. The pension cost decreased primarily due to our pension plan freeze, which eliminated all future compensation and services credits to participants of our pension plan.

Selling, general and administrative expenses, or SGA, were $120.2 million for the six months ended June 30, 2013 compared to $116.5 million for the six months ended June 30, 2012, ~~compared to $105.2 million for the six months ended June 30, 2011,~~ an increase of ~~$11.3~~$3.7 million or ~~10.7%~~3.2%. ~~Recent acquisitions, all within our Decision Analytics segment, accounted for an increase of $5.7 million, which was primarily related to salaries and employee benefits.~~ Excluding costs associated with our recent acquisitions of $3.9 million, which were primarily related to salaries and employee benefits, SGA ~~increased $5.6~~decreased $0.2 million or ~~5.3%~~0.2%. The ~~increase~~decrease was ~~primarily~~ due to a ~~net increase~~decrease in salaries and employee benefits of ~~$6.4~~$3.6 million ~~travel and travel~~primarily related to a reduction in stock option expense. Our stock option expense decreased as a result of lower accelerated vesting of equity awards granted to employees at age 62. This decrease in costs was partially offset by increases in professional fees of ~~$0.2~~$2.1 million which includes legal costs, and other expenses of ~~$0.9~~$1.3 million. ~~These increases in costs were partially offset by decreases in professional fees of $1.9 million which includes legal and marketing costs.~~

The increase in salaries and employee benefits of $6.4 million includes an increase of $7.7 million in annual salaries and employee benefits, medical costs, and long term equity compensation plan costs, and was partially offset by a decrease of $1.3 million in pension cost, primarily due to the our pension plan freeze.

Depreciation and amortization of fixed assets was $32.0 million for the six months ended June 30, 2013 compared to $24.7 million for the six months ended June 30, 2012, ~~compared to $22.2 million for the six months ended June 30, 2011,~~ an increase of ~~$2.5~~$7.3 million or ~~11.6%~~29.5%. Depreciation and amortization of fixed assets includes depreciation of furniture and equipment, software, computer hardware, and related equipment. The majority of the increase relates to software and hardware costs to support data capacity expansion and revenue growth as well as ~~depreciation and amortization associated with~~due to recent ~~acquisitions.~~acquisitions of $1.8 million.

Amortization of intangible assets was ~~$20.8~~$34.4 million for the six months ended June 30, ~~2012~~2013 compared to ~~$17.3~~$20.8 million for six months ended June 30, ~~2011,~~2012, an increase of ~~$3.5~~$13.6 million or ~~19.9%~~65.6%. The increase was primarily related to amortization of intangible assets associated with recent acquisitions of ~~$6.1~~$13.1 million, partially offset by ~~$2.6~~$0.5 million of amortization of intangible assets primarily associated with prior acquisitions that have been fully amortized.

~~Acquisition Related Liabilities Adjustment~~Investment Income and Realized Gain (Loss) on Available-for-Sale Securities, Net

~~There~~Investment income and realized gain (loss) on available-for-sale securities, net, was ~~no acquisition related liabilities adjustment for the six months ended June 30, 2012 and~~ a ~~benefit~~loss of ~~$3.4~~$0.1 million for the six months ended June 30, ~~2011. This benefit was a result of a reduction of $3.4 million~~2013 compared to contingent consideration due to the reduced probability of the D2Hawkeye and Strategic Analytics acquisitions achieving the EBITDA and revenue earn-out targets for exceptional performance in fiscal year 2011 established at the time of acquisition.

~~Investment income/(loss) and realized (loss)/gain on securities, net, was~~ a gain of $0.6 million for the six months ended June 30, 2012, ~~and $0.5~~a decrease of $0.7 million.

~~Interest expense was~~2013 compared to $33.8 million for the six months ended June 30, 2012, ~~compared to $24.5 million for the six months ended June 30, 2011,~~ an increase of ~~$9.3~~$6.0 million or ~~37.8%~~17.9%. This increase is primarily due to ~~an increase in our long-term debt outstanding, which includes~~ the issuance of ~~our 5.800% and 4.875%~~the 4.125% senior notes in ~~the~~September 2012 with an aggregate principal amount of ~~$450.0 million and $250.0 million, respectively.~~$350.0 million.

The provision for income taxes was ~~$96.2 million for the six month ended June 30, 2012 compared to $87.6~~$94.4 million for the six months ended June 30, ~~2011, an increase~~2013 compared to $96.2 million for the six months ended June 30, 2012, a decrease of ~~$8.6~~$1.8 million or ~~9.8%~~1.9%. The effective tax rate was 36.4% for the six months ended June 30, 2013 compared to 39.4% for the six months ended June 30, ~~2012 compared to 40.0% for the six months ended June 30, 2011.~~2012. The effective rate for the six months ended June 30, ~~2012~~2013 was lower than the June 30, ~~2011~~2012 effective tax rate primarily due to the continued execution of tax planning strategies and the benefits of the Research & Development, or R&D, tax credit. The American Taxpayer Relief Act of 2012 was enacted on January 2, 2013, which retroactively extended the R&D tax credit for the years 2012 and 2013 and enabled the Company to recognize the tax benefit of the 2012 credit in the first quarter of 2013.

The EBITDA margin for our consolidated results was 44.3% for the six months ended June 30, 2013 compared to 44.9% for the six months ended June 30, 2012. For the six months ended June 30, 2013, the recent acquisitions mitigated our margin expansion by 0.5%. The decrease in margin is further attributed to our investment initiatives for the development of new solutions.

Three Months Ended June 30, 2013 Compared to Three Months Ended June 30, 2012

Revenues were $421.3 million for the three months ended June 30, 2013 compared to $373.2 million for the three months ended June 30, 2012, an increase of $48.1 million or 12.9%. Recent acquisitions of ALP and Argus accounted for an increase of $19.0 million in revenues for the three months ended June 30, 2013, all of which were included in Decision Analytics. Excluding recent acquisitions, revenues increased $29.1 million or 7.8%, which included an increase in our Decision Analytics segment of $19.0 million and an increase in our Risk Assessment segment of $10.1 million.

Cost of revenues were $174.7 million for the three months ended June 30, 2013 compared to $147.1 million for the three months ended June 30, 2012, an increase of $27.6 million or 18.8%. Excluding recent acquisition cost of $9.6 million, the cost of revenues increased $18.0 million, or 12.3%. The increase is due to a net increase in salaries and employee benefits costs of $11.1 million, which include annual salary increases and medical costs. Other increases include data costs of $4.4 million, information technology expenses of $1.9 million and travel related expenses of $0.6 million.

Selling, general and administrative expenses were $61.2 million for the three months ended June 30, 2013 compared to $62.5 million for the three months ended June 30, 2012, a decrease of $1.3 million or 2.1%. Excluding the costs associated with our recent acquisitions of $1.2 million, SGA decreased $2.5 million, or 4.0%. The decrease is primarily related to a decrease in salaries and employee benefit costs of $3.5 million, primarily related to a reduction in stock option expense. Our stock option expense decreased as a result of lower accelerated vesting of equity awards granted to employees at age 62. This decrease was partially offset by an increase in professional fees of $0.2 million, and other expenses of $0.8 million, which include information technology expenses and travel related expenses.

The provision for income taxes was $47.7 million for the three months ended June 30, 2013 compared to $47.8 million for the three months ended June 30, 2012, a decrease of $0.1 million or 0.2%. The effective tax rate was 36.2% for the three months ended June 30, 2013 compared to 39.5% for the three months ended June 30, 2012. The effective tax rate for the three months ended June 30, 2013 was lower than the effective tax rate for the three months ended June 30, 2012 primarily due to the continued execution of tax planning strategies.

The EBITDA margin for our consolidated results was 44.9% for the six months ended June 30, 2012 compared to 44.2% for the six months ended June 30, 2011. For the six months ended June 30, 2012, the recent acquisitions mitigated our margin expansion by 0.7%. The increase in margin is primarily attributed to operating leverage as well as cost efficiencies achieved in 2012. For the six months ended June 30, 2011, the acquisition related liabilities adjustment positively impacted our EBITDA margin by 0.5%.

~~Three Months Ended June 30, 2012 Compared to Three Months Ended June 30, 2011~~

~~Revenues were $373.2 million~~44.1% for the three months ended June 30, 2012 compared to $327.3 million for the three months ended June 30, 2011, an increase of $45.9 million or 14.0%. Recent acquisitions accounted for an increase of $25.1 million in revenues for the three months ended June 30, 2012, all of which were in Decision Analytics in the healthcare category. Excluding recent acquisitions, revenues increased $20.8 million or 6.4%, which included an increase in our Decision Analytics segment of $17.1 million2013 and ~~an increase in our Risk Assessment segment of $3.7 million.~~

Cost of revenues was $147.1 million for the three months ended June 30, 2012 compared to $131.2 million for the three months ended June 30, 2011, an increase of $15.9 million or 12.1%. The increase was primarily due to costs related to recent acquisitions of $12.8 million, and a net increase in salaries and employee benefits costs of $1.6 million, which include annual salary increases and medical costs. Included within the net increase in salaries and employee benefits is an offsetting reduction in pension cost of $2.8 million. Other increases include rent and maintenance fees of $1.0 million, information technology expenses of $0.5 million and other operating expenses of $0.7 million. These increases were partially offset by a decrease in data costs of $0.7 million.

Selling, general and administrative expenses were $62.5 million for the three months ended June 30, 2012 compared to $55.9 million for the three months ended June 30, 2011, an increase of $6.6 million or 11.7%. The increase was primarily due to costs attributable to recent acquisitions of $3.5 million, an increase in salaries and employee benefits costs of $3.3 million, which include annual salary increases, medical costs, commissions, and equity compensation expense. Included within the net increase in salaries and employee benefits is an offsetting reduction in pension cost of $0.7 million. Travel and travel related costs also increased by $0.6 million. These increases were partially offset by a decrease in professional fees that include legal and marketing costs of $0.5 million and other expenses of $0.3 million.

The provision for income taxes was $47.8 million for the three months ended June 30, 2012 compared to $43.5 million for the three months ended June 30, 2011, an increase of $4.3 million or 10.0%. The effective tax rate was 39.5% for the three months ended June 30, 2012 compared to 39.9% for the three months ended June 30, 2011. The effective tax rate for the three months ended June 30, 2012 was lower than the effective tax rate for the three months ended June 30, 2011 primarily due to the continued execution of tax planning strategies.

~~The EBITDA margin for our consolidated results was~~ 43.9% for the three months ended June 30, 2012 and 2011. For the three months ended June 30, 2012, recent acquisitions mitigated our margin expansion by 1.0%. For the three months ended June 30, 2011, the acquisition related liabilities adjustment positively impacted our EBITDA margin by 1.0%.2012.

Revenues for our Decision Analytics segment were $517.8 million for the six months ended June 30, 2013 compared to $430.6 million for the six months ended June 30, 2012, ~~compared to $359.1 million for the six months ended June 30, 2011,~~ an increase of ~~$71.5~~$87.2 million or ~~19.9%~~20.3%. Recent acquisitions ~~which are all within the healthcare category,~~ accounted for an increase of ~~$34.8~~$52.4 million in revenues for the six months ended June 30, ~~2012.~~2013. Excluding recent acquisitions, our Decision Analytics revenue increased ~~$36.7~~$34.8 million or ~~10.3%~~8.1%.

Our insurance revenue increased ~~$20.9~~$21.8 million or 9.1%, and excluding recent acquisitions (ALP) revenue of $1.2 million within this category, our insurance revenue increased $20.6 million or 8.7%, primarily due to an increase within our underwriting solutions, catastrophe modeling services for existing customers, an increase in insurance fraud revenue, and an increase in loss quantification solutions as a result of new ~~customers~~customers.

Our financial services revenue increased $24.9 million or 35.7%, and ~~an increase in~~excluding recent acquisitions (Argus) revenue of $34.5 million within this category, our ~~catastrophe modeling~~financial services ~~for existing customers, as well an increase in insurance fraud solutions revenue. Excluding~~revenue decreased $9.6 million or 13.9%, reflecting lower volumes within our mortgage forensic solutions.

Our healthcare revenue increased $39.3 million or 48.6%, and excluding the recent acquisitions (MediConnect) for the first quarter revenue of $16.7 million within this category, our healthcare revenue increased ~~$11.1~~$22.6 million or 27.9% primarily due to an increase in transactions within our ~~fraud services~~revenue and quality intelligence solutions and due to an increase in payment accuracy solutions as customer contracts were ~~implemented and new sales of risk solutions.~~ implemented.

Our specialized markets revenue increased ~~$3.5~~$1.2 million or 3.0% as a result of continued penetration of existing customers within our supply chain services and weather and climate risk solutions. Our mortgage and financial services revenue increased $1.2 million, primarily due to the inclusion of property appraisal tools facing the mortgage market revenue of $6.1 million, which was previously reported as part of property-specific rating and underwriting information category within our Risk Assessment segment in 2011. Excluding the property appraisal revenue, our mortgage and financial services revenue decreased $4.9 million from lower volumes within forensic solutions due to the continued challenges in the mortgage market, partially offset by growth in our underwriting solutions.

Revenues for our Decision Analytics segment were $267.0 million for the three months ended June 30, 2013 compared to $229.0 million for the three months ended June 30, 2012, ~~compared to $186.8 million for the three months ended June 30, 2011,~~ an increase of ~~$42.2~~$38.0 million or ~~22.6%~~16.6%. Recent acquisitions of ALP and Argus accounted for an increase of ~~$25.1~~$19.0 million in revenues for the three months ended June 30, ~~2012.~~2013. Excluding the impact of recent acquisitions, revenue increased ~~$17.1~~$19.0 million or 8.3% for the three months ended June 30, ~~2012.~~ 2013.

Our insurance revenue increased ~~$9.9~~$11.6 million or 9.5%, and excluding recent acquisitions (ALP) revenue of $0.6 million within this category, our insurance revenue increased $11.0 million or 8.9%, primarily due to an increase within our underwriting solutions, catastrophe modeling services for existing customers, an increase in insurance fraud revenue, and an increase in loss quantification solutions as a result of new ~~customers~~customers.

Our financial services revenue increased $15.2 million or 43.1%, and ~~an increase in our catastrophe modeling services for existing customers, as well an increase in insurance fraud solutions revenue. Excluding the~~excluding recent acquisitions (Argus) revenue of $18.4 million within this category, our financial services revenue decreased $3.2 million or 8.9%, reflecting lower volumes within our mortgage forensic solutions.

Our healthcare revenue increased ~~$5.9~~$10.7 million or 21.3% primarily due to an increase in transactions within our ~~fraud services~~revenue and quality intelligence solutions and due to an increase in payment accuracy solutions as customer contracts were ~~implemented and new sales of risk solutions.~~ implemented.

Our specialized markets revenue increased ~~$1.7~~$0.5 million or 2.4% as a result of continued penetration of existing customers within our supply chain services and weather and climate risk solutions. Excluding the property appraisal revenue, our mortgage and financial services revenue decreased $3.5 million from lower volumes within our forensic solutions due to the continued challenges in the mortgage market.

Cost of revenues for our Decision Analytics segment ~~was~~were $243.8 million for the six months ended June 30, 2013 compared to $189.7 million for the six months ended June 30, 2012, ~~compared to $159.4 million for the six months ended June 30, 2011,~~ an increase of ~~$30.3~~$54.1 million or ~~19.0%~~28.6%. Excluding the impact of recent acquisitions of ~~$17.6~~$28.8 million, our cost of revenues increased by ~~$12.7~~$25.3 million or ~~8.0%~~13.4%. This increase is primarily due to a net increase in salary and employee benefits of ~~$9.4~~$17.1 million. Other increases include data costs of $4.1 million, information technology expenses of ~~$1.4 million, rent and maintenance office expenses of $0.7~~$2.6 million, travel and travel related costs of ~~$0.7~~$0.3 million and other operating expenses of ~~$0.6~~$1.2 million. ~~These increases in costs were partially offset by a $0.1 million decrease in data related costs.~~

The increase in salaries and employee benefits of $9.4 million includes an increase of $10.2 million in annual salaries and employee benefits, medical costs, and long term equity compensation plan costs, and due to the reallocation of certain resources from Risk Assessment relating to property appraisal tools that began in January 2012. These increases were partially offset by a decrease of $0.8 million in pension cost primarily because of our pension plan freeze.

Cost of revenues for our Decision Analytics segment ~~was~~were $126.2 million for the three months ended June 30, 2013 compared to $101.8 million for the three months ended June 30, 2012, ~~compared to $82.1 million for the three months ended June 30, 2011,~~ an increase of ~~$19.7~~$24.4 million or ~~23.9%~~24.0%. The increase was primarily due to costs related to recent acquisitions of ~~$12.8~~$9.6 million, and a net increase in salaries and employee benefits costs of $5.3 million partially from the reallocation of certain resources from Risk Assessment. Included within the net increase in salaries and employee benefits is an offsetting reduction in pension cost of $0.4$8.5 million. Other increases include ~~rent and maintenance fees~~an increase of ~~$0.6~~data costs of $4.2 million, information technology expenses of ~~$0.7~~$1.5 million, travel related expenses of $0.1, and other operating expenses of ~~$0.7 million. These increases were partially offset by a decrease in data costs of $0.4~~$0.5 million.

Selling, general and administrative expenses for our Decision Analytics segment were $81.0 million for the six months ended June 30, 2013 compared to $74.0 million for the six months ended June 30, 2012, ~~compared to $62.7 million for the six months ended June 30, 2011,~~ an increase of ~~$11.3~~$7.0 million or ~~17.9%~~9.6%. Excluding the impact of recent acquisitions of ~~$5.7~~$3.9 million, SGA increased ~~$5.6~~$3.1 million or ~~8.9%~~4.2%. The increase was primarily due to an increase in salaries and employee benefits of ~~$6.1~~$1.0 million. Other increases included professional fees of $1.1 million and ~~an increase in~~ other expenses of ~~$0.2~~$1.0 million. ~~These increases in costs were partially offset by a decrease in professional fees of $0.7 million which includes legal and marketing costs.~~

The increase in salaries and employee benefits of $6.1 million includes an increase of $6.4 million in annual salaries and employee benefits, medical costs, commissions, and long term equity compensation plan costs, and was partially offset by a decrease of $0.3 million in pension cost, primarily due to the our pension plan freeze.

Selling, general and administrative expenses for our Decision Analytics segment were $41.6 million for the three months ended June 30, 2013 compared to $39.6 million for the three months ended June 30, 2012, ~~compared to $32.6 million for the three months ended June 30, 2011,~~ an increase of ~~$7.0~~$2.0 million or ~~21.5%~~5.0%. Excluding the impact of recent acquisitions of $1.2 million, SGA increased $0.8 million or 2.1%. The increase was ~~primarily~~ due to ~~costs attributable to recent acquisitions of $3.5 million,~~ an increase in salaries and employee benefits ~~costs of $3.7 million. Included within the net increase in salaries and employee benefits is an offsetting reduction in pension cost~~ of $0.2 ~~million. Travel~~million, which include salary increases, medical costs, commissions, and ~~travel related costs also increased by $0.3 million. These increases were partially offset by a decrease in~~equity compensation and other general expenses of ~~$0.5~~$0.6 million.

The EBITDA margin for our Decision Analytics segment was 37.3% for the six months ended June 30, 2013 compared to 38.8% for the six months ended June 30, ~~2012 compared to 39.1% for the six months ended June 30, 2011.~~2012. For the six months ended June 30, ~~2012,~~2013, recent acquisitions mitigated our margin expansion by ~~0.8%. For the six months ended June 30, 2011, the acquisition related liabilities adjustment positively impacted our EBITDA margin by 0.9%~~0.1%.

Revenues for our Risk Assessment segment were $306.8 million for the six months ended June 30, 2013 as compared to $289.1 million for the six months ended June 30, 2012, ~~as compared to $281.0~~an increase of $17.7 million or 6.1%. Revenues were $154.3 million for the ~~six~~three months ended June 30, ~~2011, an increase of $8.1 million or 2.9%. Revenues were~~2013 as compared to $144.2 million for the three months ended June 30, 2012, ~~as compared to $140.5 million for the three months ended June 30, 2011,~~ an increase of ~~$3.7~~$10.1 million or ~~2.6%~~7.0%. The overall increase within this segment primarily resulted from an increase in prices derived from continued enhancements to the content of our industry-standard insurance programs’ solutions as well as selling expanded solutions to existing customers. As described with the Decision Analytics segment revenue, beginning January 1, 2012, we reallocated certain property appraisal tools revenue of $3.2 million and $6.1 million for three and six months ended June 30, 2012, respectively, from the property-specific rating and underwriting information category to the mortgage and financial services category.


	For Three Months Ended June 30,				Percentage			For Six Months Ended June 30,				Percentage			For Three Months Ended June 30,				Percentage Change				For Six Months Ended June 30,					Percentage Change
	2012		2011		Change			2012		2011		Change			2013		2012					2013			2012			Percentage Change
	(In thousands)														(In thousands)				Percentage Change					(In thousands)
Industry-standard insurance programs	$	98,010	$	92,389		6.1	%	$	197,144	$	185,246		6.4	%	$	117,289	$	111,730		5.0	%		$	233,739		$	224,142		4.3	%
Property-specific rating and underwriting information		32,459		35,017		(7.3	)%		65,016		69,514		(6.5	)%		36,970		32,459		13.9	%			73,133			65,016		12.5	%
Statistical agency and data services		8,130		7,633		6.5	%		15,854		15,375		3.1	%
Actuarial services		5,590		5,491		1.8	%		11,144		10,938		1.9	%

Total Risk Assessment	$	144,189	$	140,530		2.6	%	$	289,158	$	281,073		2.9	%	$	154,259	$	144,189		7.0	%		$	306,872		$	289,158		6.1	%

Cost of revenues for our Risk Assessment segment was $95.3 million for the six months ended June 30, 2013 compared to $90.7 million for the six months ended June 30, 2012, ~~compared to $96.3 million for the six months ended June 30, 2011, a decrease~~an increase of ~~$5.6~~$4.6 million or ~~5.8%~~5.0%. The ~~decrease~~increase was primarily due to ~~a decrease~~an increase in salaries and employee benefits costs of $4.5 million, primarily related to lower pension cost of $4.0 million, and the reallocation of certain resources to Decision Analytics relating to property appraisal tools that occurred in January 2012.$2.9 million. Other ~~decreases~~increases were related to ~~data costs~~information technology expenses of ~~$0.7~~$0.8 million, travel and travel related costs of ~~$0.5~~$0.8 million, and ~~information technology~~data costs of ~~$0.3 million. These decreases were partially offset by an increase in rent and maintenance office expenses of $0.4~~$0.1 million.

Cost of revenues for our Risk Assessment segment was $48.5 million for the three months ended June 30, 2013 compared to $45.3 million for the three months ended June 30, 2012, ~~compared to $49.1 million for the three months ended June 30, 2011, a decrease of $3.8~~an increase $3.2 million or ~~7.6%~~7.0%. The ~~decrease~~increase was primarily due to ~~a decrease~~an increase in salaries and employee benefits costs of ~~$3.7~~$2.6 million. ~~Included within the decrease in salaries and employee benefits is a reduction in pension cost of $2.4 million and the reallocation of certain resources to Decision Analytics.~~ Other ~~decreases~~increases include information technology expenses of ~~$0.2 and~~$0.4 million, data costs of ~~$0.3~~$0.2 million, and travel related expenses of $0.5 million. These ~~decreases~~increases were partially offset by ~~an increase~~a decrease in ~~rent and office maintenance~~other general expenses of ~~$0.4~~$0.5 million.

Selling, general and administrative expenses for our Risk Assessment segment were ~~$42.5~~$39.2 million for the six months ended June 30, 2013 and $42.5 million for six month ended June 30, 2012, ~~and 2011.~~a decrease of $3.3 or 7.9%. There was a net ~~increase~~decrease in salaries and employee benefits of ~~$0.3~~$4.6 million ~~travel and travel~~which was primarily related ~~costs~~to a

reduction in stock option expense. Our stock option expense decreased as a result of ~~$0.2 million and other expenses~~lower accelerated vesting of ~~$0.7 million. These increases in costs were~~equity awards granted to employees at age 62. This decrease was partially offset by ~~a decrease~~an increase in professional fees of ~~$1.2~~$1.0 million ~~which includes legal~~ and ~~marketing costs.~~

~~The increase in salaries and employee benefits~~other general expenses of $0.3 million includes an increase of $1.3 million in annual salaries and employee benefits, medical costs, and long term equity compensation plan costs, and was partially offset by a decrease of $1.0 million in pension cost primarily due to our pension plan freeze.million.

Selling, general and administrative expenses for our Risk Assessment segment were $19.6 million for the three months ended June 30, 2013 compared to $22.9 million for the three months ended June 30, 2012, ~~compared to $23.3 million for the three months ended June 30, 2011,~~ a decrease of ~~$0.4~~$3.3 million or ~~1.9%~~14.4%. The decrease was primarily due to a decrease in salaries and employee benefits costs of ~~$0.4 million, which includes a reduction in pension cost of $0.5~~$3.7 million. ~~Other decreases were professional fees that include legal and marketing costs of $0.5 million. These decreases were~~This decrease was partially offset by an increase in ~~travel and travel related costs~~professional fees of ~~$0.3~~$0.2 million and other general expenses of $0.2 million.

EBITDA margin for our Risk Assessment segment was 56.2% for the six months ended June 30, 2013 compared to 54.1% for the six months ended June 30, ~~2012 compared to 50.8% for the six months ended June 30, 2011.~~2012. The increase in margin is primarily attributed to operating leverage in the segment as well as cost efficiencies.

As of June 30, ~~2012~~2013 and December 31, ~~2011,~~2012, we had cash and cash equivalents and available-for-sale securities of ~~$102.0~~$176.8 million and ~~$196.7~~$94.7 million, respectively. Subscriptions for our solutions are billed and generally paid in advance of rendering services either quarterly or in full upon commencement of the subscription period, which is usually for one year. Subscriptions are automatically renewed at the beginning of each calendar year. We have historically generated significant cash flows from operations. As a result of this factor, as well as the availability of funds under our $850.0 million syndicated revolving credit facility, we believe that we will have sufficient cash to meet our working capital and capital expenditure needs, and to fuel our future growth plans.

We have historically managed the business with a working capital deficit due to the fact that, as described above, we offer our solutions and services primarily through annual subscriptions or long-term contracts, which are generally prepaid quarterly or annually in advance of the services being rendered. When cash is received for prepayment of invoices, we record an asset (cash and cash equivalents) on our balance sheet with the offset recorded as a current liability (fees received in advance). This current liability is deferred revenue that does not require a direct cash outflow since our customers have prepaid and are obligated to purchase the services. In most businesses, growth in revenue typically leads to an increase in the accounts receivable balance causing a use of cash as a company grows. Unlike these businesses, our cash position is favorably affected by revenue growth, which results in a source of cash due to our customers prepaying for most of our services.

Our capital expenditures, which include noncash purchases of fixed assets and capital lease obligations, as a percentage of revenues for the six months ended June 30, 2013 and 2012, were 7.8% and ~~2011, were~~ 5.3% ~~and 5.4%~~, respectively. The increase in capital expenditures is primarily due to our investment initiatives for development of new solutions. The expected capital expenditures for the year ending December 31, 2013, of $115.0 million, are consistent with the amounts previously disclosed as of December 31, 2012, which we expect to primarily include expenditures on our technology infrastructure and our continuing investments in developing and enhancing our solutions. Expenditures related to developing and enhancing our solutions are predominately related to internal use software and are capitalized in accordance with ASC 350-40, “Accounting for Costs of Computer Software Developed or Obtained for Internal Use.” We also capitalize amounts in accordance with ASC 985-20, “Software to be Sold, Leased or Otherwise Marketed.” ~~The amounts capitalized in accordance with the accounting guidance for software to be sold, leased or otherwise marketed are not significant to the financial statements.~~

We historically used a portion of our cash for repurchases of our common stock from our stockholders. During the six months ended June 30, ~~2012~~2013 and ~~2011,~~2012, we repurchased ~~$107.0~~$137.6 million and ~~$217.0~~$107.0 million of our ~~Class A~~ common stock, respectively. ~~See Note 9 to our condensed consolidated financial statements included in this quarterly report on Form 10-Q.~~

~~We provide~~In prior years, we provided pension and postretirement benefits to certain qualifying active employees and retirees. On February 29, 2012, we instituted a hard freeze, which eliminated all future compensation and service credits, to all participants in the pension plans. In April 2012, we completed a voluntary prefunding to our qualified pension plan of $72.0 million, which resulted in a contribution of $78.8 million for the year, of which $28.2 million was the minimum contribution requirement for 2012. We do not anticipate further contributions in 2012 to be made with respect to our qualified pension plan. Under the postretirement plan, we ~~provide~~provided certain healthcare and life insurance benefits to qualifying participants; however, participants are required to pay a stated percentage of the premium coverage. ~~In March 2012, we established a voluntary employee’s beneficiary association plan, or VEBA plan, to fund the postretirement plan. We contributed $5.0 million and $8.5 million~~The expected contributions to the ~~VEBA Plan for the three~~pension and ~~six months ended June 30, 2012, respectively. We expect the contribution to the~~ postretirement ~~plan for the remaining quarters~~plans for the year ending December 31, ~~2012 to be~~2013 are consistent with ~~this quarter.~~the amounts previously disclosed as of December 31, 2012. See Note 11 to our condensed consolidated financial statements included in this quarterly report on Form ~~10-Q.~~10-Q for further information.

We had total debt, excluding capital lease and other obligations, of ~~$1,246.9~~$1,399.8 million and ~~$1,096.7~~$1,454.4 million at June 30, ~~2012~~2013 and December 31, ~~2011,~~2012, respectively. The debt at June 30, ~~2012~~2013 was issued under our ~~Syndicated Revolving Credit facility (“credit facility”),~~ long-term private placement loan facilities and senior notes issued in 2012 and 2011 to finance our stock repurchases and acquisitions.

Our $850.0 million syndicated revolving credit facility (“credit facility”) is due October ~~2016 of $725.0 million,~~2017 and is a committed ~~facility and all of our long-term private placement loan facilities are uncommitted facilities.~~facility. We have financed and expect to finance our short-term working capital needs, stock repurchases and acquisitions through cash from operations and borrowings from ~~a combination of~~ our credit ~~facility and long-term private placement facilities.~~facility. As of June 30, ~~2012,~~2013, we had ~~$150.0~~no outstanding borrowings under the credit facility. During the six months ended June 30, 2013, we repaid $10 million of borrowings that were outstanding under the credit ~~facility.~~facility as of December 31, 2012. We ~~borrowed $200.0 million from our credit facility and repaid $50.0 million of this balance~~did not make any additional borrowings during the six months ended June 30, ~~2012. On July 2, 2012, we repaid an additional $10.0 million related to the outstanding balance of the credit facility.~~2013. As of June 30, ~~2012, our credit facility~~2013, we had ~~$575.0~~$850.0 million of borrowing capacity ~~available.~~available under our credit facility.

The credit facility contains certain customary financial and other covenants that, among other things, impose certain restrictions on indebtedness, liens, investments, and capital expenditures. These covenants also place restrictions on mergers, asset sales, sale/leaseback transactions, payments between us and our subsidiaries, and certain transactions with affiliates. The financial covenants require that, at the end of any fiscal quarter, we have a consolidated interest coverage ratio of at least 3.0 to 1.0 and that we maintain a consolidated funded debt leverage ratio below ~~3.25~~3.50 to 1.0. We were in compliance with all debt covenants under the credit facility as of June 30, ~~2012.~~2013.

We ~~also~~ have a long-term private placement loan ~~facilities~~facility under an uncommitted master shelf ~~agreements~~agreement with ~~New York Life and~~ Prudential Capital Group, or Prudential, with ~~availabilities at June 30, 2012 in the amounts~~available capacity of ~~$30.0 million and $190.0 million, respectively.~~$205.0 million. We can borrow under ~~the New York Life Master Shelf Agreement until March 16, 2013 and~~ the Prudential Master Shelf Agreement until August 30, 2013. We also had an uncommitted master shelf agreement with New York Life that expired on March 16, 2013. We did not extend this agreement. During the six months ended June 30, 2013, we repaid $45.0 million of our outstanding long-term private placement loan facilities debt that matured in April 2013 with cash from operations.

The notes outstanding under ~~these~~the long-term private placement loan facilities mature over the next ~~four~~three years. Individual borrowings are made at a fixed rate of interest determined at the time of the borrowing and interest is payable quarterly. The weighted average rate of interest with respect to our outstanding borrowings under these facilities was ~~6.3%~~6.25% for the six months ended June 30, ~~2012.~~2013. The uncommitted master shelf agreements contain certain covenants that limit our ability to create liens, enter into sale/leaseback transactions and consolidate, merge or sell assets to another company. Our shelf agreements also ~~contains~~contain financial covenants that require that, at the end of any fiscal quarter, we have a consolidated interest coverage ratio of at least 3.0 to 1.0 and that we maintain a consolidated funded debt leverage ratio below 3.0 to 1.0 ~~during~~at the end of any ~~period of four~~ fiscal ~~quarters.~~quarter. We were in compliance with all debt covenants under our master shelf agreements as of June 30, ~~2012.~~2013.

As of June 30, ~~2012,~~2013, we had senior notes with aggregate principal amount of ~~$700.0~~$1,050.0 million. The senior notes are fully and unconditionally guaranteed, jointly and severally, on an unsecured and unsubordinated basis by ISO and certain subsidiaries that guarantee our credit facility, or any amendment, refinancing or replacement

thereof. The indenture governing the senior notes restricts our ability and our subsidiaries’ ability to, among other things, create certain liens, enter into sale/leaseback transactions and consolidate with, sell, lease, convey or otherwise transfer all or substantially all of our assets, or merge with or into, any other person or entity.

The following table summarizes our cash flow data for the six months ended June 30, ~~2012~~2013 and ~~2011:~~2012:


	For the Six Months Ended June 30,						For the six months ended June 30,						Percentage Change
	2012			2011			2013			2012			Percentage Change
	(In thousands)						(In thousands)
Net cash provided by operating activities	$	187,435		$	187,087		$	246,691		$	187,435			31.6	%
Net cash used in investing activities	$	(387,037	)	$	(172,586	)	$	(62,998	)	$	(387,037	)		(83.7	)%
Net cash provided by/(used in) financing activities	$	105,331		$	(18,078	)
Net cash (used in)/provided by financing activities							$	(100,244	)	$	105,331			(195.2	)%

Net cash provided by operating activities increased to $246.7 million for the six months ended June 30, 2013 compared to $187.4 million for the six months ended June 30, ~~2012 from $187.1 million for the six months ended June 30, 2011.~~2012. The ~~slight~~ increase in ~~net cash provided by~~ operating activities was ~~principally~~primarily due to an increase in cash ~~receipts~~collections from customers, ~~during the six months ended June 30, 2012. This increase was~~ partially offset by an increase in operating expense and interest payments ~~during~~related to our bond offerings. In the ~~six months ended June 30,~~second quarter of 2012, ~~compared~~we pre-funded $72.0 million to ~~the six months ended June 30, 2011. The growth in operating cash flow was mitigated by the pre-funding of~~ our pension ~~plan in April 2012 of $72.0 million, partially~~plan. This prefunding was offset by the tax benefit associated with ~~these~~those deductible ~~contributions.~~

Net cash used in investing activities was $63.0 million for the six months ended June 30, 2013 compared to $387.0 million for the six months ended June 30, 2012. The decrease in net cash used in investing activities was primarily due to the fact that we had acquired MediConnect in the first quarter of 2012 ~~compared to $172.6~~for $348.3 million versus minor acquisition activity in 2013.

Net cash (used in) provided by financing activities was $(100.2) million for the six months ended June 30, 2011. The increase in net cash used in investing activities was principally due to an increase in acquisition payments of $209.6 million, primarily related to the acquisition of MediConnect in the first quarter of 2012,2013 and ~~an increase in the purchases of fixed assets of $8.4 million during the six months ended June 30, 2012.~~

~~Net cash provided by/(used in) financing activities was~~ $105.3 million for the six months ended June 30, ~~2012 and $(18.1) million~~2012. Net cash used in financing activities for the six months ended June 30, ~~2011.~~2013 was primarily related the repurchase of common stock of $135.6 million, partially offset by proceeds from stock option exercises of $30.5 million. Net cash provided by financing activities for the six months ended June 30, 2012, was primarily related to an increase in total net debt of $150.0 million, stock option exercises and ~~option~~the related tax benefit associated with these exercises of $65.1 million, partially offset by stock repurchases of ~~our Class A common stock of~~ $106.3 million. Net cash used in financing activities for the six months ended June 30, 2011 was primarily related to a repurchases of our Class A common stock of $214.0 million partially offset by an increase in total net debt of $172.4 million.

There have been no material changes to our contractual obligations outside the ordinary course of our business from those reported in our annual report on Form 10-K and filed with the Securities and Exchange Commission on February ~~28, 2012~~26, 2013, except as noted below.

~~Due to our voluntary prefunding and hard freeze~~On April 20, 2013, the employee stock ownership plan, or ESOP, refinanced its intercompany loan, thereby extending the allocation of the ~~pension plans (see~~remaining unreleased shares through 2016. As part of this new loan agreement, we were required to contribute an additional $9.0 million of cash or shares, plus interest, to the ESOP by 2016. Earlier contribution is at our discretion (See Note 1110 in our condensed consolidated financial statements included in this quarterly report on Form 10-Q)~~, we~~. We expect our contractual obligations payments for the~~Pension and postretirement plans~~Other long-term liabilitiesto ~~decrease~~change to the following amounts:~~1-3~~2-3 years ~~$11.2 million,~~$0.3 million;~~3-5~~4-5 years ~~$7.3 million, and~~~~More than 5 years~~ ~~$15.4~~$18.8 million.

Our management’s discussion and analysis of financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements require management to make estimates and judgments that affect reported amounts of assets and liabilities and related disclosures of contingent assets and liabilities at the dates of the financial statements and revenue and expenses during the reporting periods. These estimates are based on historical experience and on other assumptions that are believed to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, goodwill and intangible assets, pension and other post retirement benefits, stock-based compensation, and income taxes. Actual results may differ from these assumptions or conditions. Some of the judgments that management makes in applying its accounting estimates in these areas are discussed under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our annual report on Form 10-K dated and filed with the Securities and Exchange Commission on February ~~28, 2012.~~26, 2013. Since the date of our annual report on Form 10-K, there have been no material changes to our critical accounting policies and estimates.

Market risks at June 30, ~~2012~~2013 have not materially changed from those discussed under Item 7A in our annual report on Form 10-K dated and filed with the Securities and Exchange Commission on February ~~28, 2012.~~26, 2013.

We are required to maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control ~~objectives.~~objectives at the reasonable assurance level.

Our management, with the participation of the Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of 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 quarterly report on Form 10-Q. Based upon the foregoing assessments, our Chief Executive Officer and Chief Financial Officer have concluded that, as of June 30, ~~2012,~~2013, our disclosure controls and procedures were effective.

During the ~~three month period~~six months ended June 30, ~~2012,~~2013, there has been no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

We are party to legal proceedings with respect to a variety of matters in the ordinary course of business. See Part I Item I. Note 14 to our condensed consolidated financial statements for the six months ended June 30, ~~2012~~2013 for a description of our significant current legal proceedings, which is incorporated by reference herein.

There has been no material change in the information provided under the heading “Risk Factors” in our annual report on Form 10-K dated and filed with the Securities and Exchange Commission on February ~~28, 2012.~~26, 2013.

There were no unregistered sales of equity securities by the Company during the period covered by this report.

~~On April 29, 2010, our~~Our board of directors has authorized a ~~$150.0 million~~ share repurchase program, or ~~the~~ Repurchase Program, of ~~our common stock. On October 19, 2010, March 11, 2011, and July 8, 2011, our board of directors authorized~~up to $1,200.00 million, including the additional ~~capacity of $150.0 million each, and on January 11, 2012, our board of directors authorized additional capacity~~authorization of $300.0 million ~~bringing the Repurchase Program to a total~~announced on June 20, 2013. As of ~~$900.0 million.~~June 30, 2013, $306.6 million of available authorization remained. Under the Repurchase Program, we may repurchase stock in the ~~open~~ market or as otherwise determined by us. These authorizations have no expiration dates ~~although they~~and may be suspended or terminated at any time. Our shares repurchased for the quarter ended June 30, ~~2012~~2013 are set forth below:

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


Delaware		26-2994223
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

545 Washington Boulevard Jersey City, NJ		07310-1686
(Address of principal executive offices)		(Zip Code)


Class		Shares Outstanding
Class A common stock $.001 par value		~~165,833,557~~ 167,915,445


	Page Number

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

Condensed Consolidated Balance Sheets		3	1

Condensed Consolidated Statements of Operations		4	2

Condensed Consolidated Statements of Comprehensive Income		5	3

Condensed Consolidated Statements of Changes in Stockholders’ ~~Equity/~~Equity (Deficit)		6	4

Condensed Consolidated Statements of Cash Flows		7	5

Notes to Condensed Consolidated Financial Statements		8	6

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		25	34

Item 3. Quantitative and Qualitative Disclosures About Market Risk		33	47

Item 4. Controls and Procedures		33	47

PART II — OTHER INFORMATION

Item 1. Legal Proceedings		34	48

Item 1A. Risk Factors		34	48

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		34	48

Item 3. Defaults Upon Senior Securities		34	48

Item 4. Mine Safety Disclosures		34	48

Item 5. Other Information		34	48

Item 6. Exhibits		34	48

SIGNATURES		35

Exhibit 31.1

Exhibit 31.2

Exhibit 32.1

~~Exhibit 99.1~~


	2013				2012
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial instrument not carried at fair value:
Long-term debt excluding capitalized leases	$	1,399,769	$	1,496,142	$	1,454,409	$	1,575,950


			Gross		Gross
	Adjusted		Unrealized		Unrealized
	Cost		Gain		Loss			Fair Value
June 30, 2012
Registered investment companies	$	4,857	$	—	$	(75	)	$	4,782

Total available-for-sale securities	$	4,857	$	—	$	(75	)	$	4,782

December 31, 2011
Registered investment companies	$	4,618	$	439	$	—		$	5,057
Equity securities		14		—		(5	)		9

Total available-for-sale securities	$	4,632	$	439	$	(5	)	$	5,066


	Adjusted Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
June 30, 2013
Registered investment companies	$	4,710	$	—	$	(456	)	$	4,254

December 31, 2012
Registered investment companies	$	4,830	$	53	$	—		$	4,883


Level 1 -		Assets or liabilities for which the identical item is traded on an active exchange, such as publicly-traded instruments.


Level 2 -		Assets and liabilities valued based on observable market data for similar instruments.


Level 3 -		Assets or liabilities for which significant valuation assumptions are not readily observable in the market; instruments valued based on the best available data, some of which isare internally-developed, and considers risk premiums that market participant would require.


	Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
June 30, 2013
Cash equivalents - money-market funds	$	1,439	$	—	$	1,439
Registered investment companies (1)	$	4,254	$	4,254	$	—

December 31, 2012
Cash equivalents - money-market funds	$	760	$	—	$	760
Registered investment companies (1)	$	4,883	$	4,883	$	—


			Quoted Prices
			in Active Markets		Significant Other
			for Identical		Observable
	Total		Assets (Level 1)		Inputs (Level 2)
June 30, 2012
Cash equivalents—money-market funds	$	553	$	—	$	553
Registered investment companies (1)	$	4,782	$	4,782	$	—

December 31, 2011
Cash equivalents—money-market funds	$	2,449	$	—	$	2,449
Registered investment companies (1)	$	5,057	$	5,057	$	—
Equity securities (1)	$	9	$	9	$	—


	MediConnect
Accounts receivable	$	7,077
Current assets		14,918
Fixed assets		1,075
Intangible assets		157,905
Goodwill		223,982
Other assets		17,087

Total assets acquired		422,044

Current liabilities		3,005
Other liabilities		70,634

Total liabilities assumed		73,639

Net assets acquired	$	348,405


	Weighted Average Useful Life	MediConnect
Technology-based	10 years	$	43,110
Marketing-related	4 years		14,782
Customer-related	10 years		100,013

Total intangible assets	9 years	$	157,905


	2012
	(unaudited)
Pro forma revenues	$	747,161
Pro forma net income	$	142,813
Pro forma basic income per share	$	0.86
Pro forma diluted income per share	$	0.83


	Number of Options			Weighted Average Exercise Price		Aggregate Intrinsic Value
Outstanding at December 31, 2011		18,896,405		$	16.55	$	445,510

Granted		785,079		$	46.97
Exercised		(3,750,300	)	$	8.94	$	133,338

Cancelled or expired		(256,133	)	$	11.88

Outstanding at June 30, 2012		15,675,051		$	19.97	$	459,054

Options exercisable at June 30, 2012		10,387,287		$	15.68	$	348,780

Options exercisable at December 31, 2011		12,153,311		$	12.35	$	337,647


	Before Tax			Tax Benefit (Expense)			After Tax
June 30, 2013
Unrealized foreign currency loss	$	(681	)	$	—		$	(681	)

Unrealized loss on available-for-sale securities before reclassifications		(1,248	)		477			(771	)
Amount reclassified from accumulated other comprehensive income (1)		739			(282	)		457

Unrealized loss on available-for-sale securities		(509	)		195			(314	)

Pension and postretirement unfunded liability adjustment before reclassifications		5,555			(2,023	)		3,532
Amortization of prior service credit reclassified from accumulated other comprehensive income (2)		75			(29	)		46
Amortization of net actuarial loss reclassified from accumulated other comprehensive income (2)		(2,852	)		1,091			(1,761	)

Pension and postretirement unfunded liability adjustment		2,778			(961	)		1,817

Total other comprehensive income	$	1,588		$	(766	)	$	822

June 30, 2012
Unrealized foreign currency loss	$	(134	)	$	—		$	(134	)

Unrealized loss on available-for-sale securities before reclassifications		(809	)		314			(495	)
Amount reclassified from accumulated other comprehensive income (1)		300			(118	)		182

Unrealized loss on available-for-sale securities		(509	)		196			(313	)

Pension and postretirement unfunded liability adjustment before reclassifications		4,836			(1,962	)		2,874
Amortization of prior service credit reclassified from accumulated other comprehensive income (2)		208			(79	)		129
Amortization of net actuarial loss reclassified from accumulated other comprehensive income (2)		(2,626	)		1,003			(1,623	)

Pension and postretirement unfunded liability adjustment		2,418			(1,038	)		1,380

Total other comprehensive income	$	1,775		$	(842	)	$	933


Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in thousands)
April 1, 2012 through April 30, 2012		221,200	$	46.79		221,200	$	257,504
May 1, 2012 through May 31, 2012		543,443	$	47.95		543,443	$	231,449
June 1, 2012 through June 30, 2012		669,025	$	47.40		669,025	$	199,737

		1,433,668				1,433,668


	Verisk Analytics, Inc.
	(Registrant)

Date: July ~~31, 2012~~30, 2013	By:	/s/ Mark V. Anquillare
		Mark V. Anquillare
	~~Mark V. Anquillare~~	Executive Vice President and Chief Financial Officer
		(Principal Financial Officer and Duly Authorized Officer)


Exhibit Number		Description

31.1		Certification of the Chief Executive Officer of Verisk Analytics, Inc. pursuant to Rule 13a-14 under the Securities Exchange Act of 1934.*

31.2		Certification of the Chief Financial Officer of Verisk Analytics, Inc. pursuant to Rule 13a-14 under the Securities Exchange Act of 1934.*

32.1		Certification of the Chief Executive Officer and Chief Financial Officer of Verisk Analytics, ~~Inc,~~Inc. pursuant to 18 U.S.C. Section 1350 as ~~Adopted Pursuant~~adopted pursuant to Section 906 of ~~the~~ Sarbanes-Oxley Act of 2002.*

~~99.1~~		Verisk Analytics, Inc. 2012 Employee Stock Purchase Plan, as amended*

Large accelerated filer

Accelerated filer

Non-accelerated filer

¨ (Do not check if a smaller reporting company)

Smaller reporting company