Good morning, everyone. Thanks for joining us today. My name is Andrew Nicholas, and I'm the research analyst covering information services, consulting, and HR tech here at William Blair. Before getting started, I am required to inform you that for a complete list of research disclosures or potential conflicts of interest, please visit our website at williamblair.com. With that out of the way, I'm very pleased to welcome Verisk CEO, Lee Shavel, to the 44th annual William Blair Growth Stock Conference. I will hand it over to Lee for his presentation. Thanks, Lee.
Great. Good morning, everyone, and thank you, Andrew. It's always great to be here, such a fantastic conference. You know, I think particularly because of the breadth of the companies that come and talking about what they do, you know, which is really exciting stuff. You know, my challenge, I've got two challenges today. One is to try to keep you engaged and interested on the insurance industry and data and analytics. Now, data and analytics is pretty cool, but most people, when you end up start talking about insurance, it can become a little tedious from their perspective, so we'll try to keep it lively.
I do think some of the stuff that we do is some of the most interesting work that we do in helping insurance companies underwrite, manage their claims process, and connect in the broader insurance ecosystem, and we're in a very privileged position to do that. The other challenge is that I haven't been doing these as much as I had been when I was the CFO, so I may be a little rusty. But I'll do my best to keep this moving along. One of the challenges is, from this seat, you see an awful lot more, and you have a lot more to share, so we'll try to keep that in bounds. Let's start. We want to talk about really three primary elements.
One, to give you a sense of Verisk as a predictable growth company. We, at the beginning of 2023, had an investor day where we reintroduced Verisk after shedding some of our non-insurance businesses, so we're just focused on insurance. And so I want to provide some of the underpinnings of that core proposition. We also want to talk about the extraordinary competitive position that we're in and how we capitalize in that central scaled role within the industry, and then we'll provide some perspectives on the financial overview. So let's start with what Verisk is as a predictable growth company, and I want to start off really talking about some of the rather remarkable financial dimensions. Our revenue, about $2.7 billion.
We have very strong profitability for 2023 of a 53.5% Adjusted EBITDA margin. As I mentioned, we're entirely focused on the insurance vertical. We have very strong retention and high penetration into our insurance industry because the data that we provide and the function that we provide are often mission-critical to the underwriting and the claims function, and we tend to have a very high recurring aspect to our business. About 70%, slightly over 70% is related to the underwriting function for us, with about 30% in claims solutions, and we're about 83% domestically oriented.
Our origin was as a utility to the U.S. property and casualty insurance industry, but our international business, as we have sought to bring our data expertise, our technology expertise to international markets, which aren't as well developed from a data and technology standpoint, has been growing faster and represents about 17% of our business. If there's one thing that I want you all to take away from our session today, it's that our track record as an insurance business has been remarkably consistent. We have averaged a cumulative. We have a cumulative annual growth rate over the past 15 years of about 8.3%, and you can see down below, our organic constant currency revenue growth has been very consistently, with few exceptions, in that 6%-8% light blue range that is there.
And, you know, in this, I think it's important to understand that this is a higher growth rate generally than the insurance industry as a whole. I think one common misperception that we encounter is, "Well, don't you just grow with the insurance industry?" And while in one level we do, that as premiums grow, and profitability grows for the industry, the value of our data and analytics grow proportionately. But what drives our stronger growth is that as the industry is increasingly grappling with rapidly changing technology and particularly expanding data sets, our ability to be their partner in gathering those data sets, standardizing them, analyzing them, and helping them on their journey to become more digitally oriented, more data intensive, and improve the efficiency of their technology, is a primary growth driver.
And so, when we look at our revenues in the U.S. relative to U.S. property and casualty gross written premiums, we only represent approximately 30-40 basis points of aggregate gross written premiums. And so from our view, there's a lot of opportunity for us to expand that as the insurance, as the insurance industry becomes more data sophisticated, more technologically sophisticated, and as they upgrade many of their systems. So, you know, please note the consistency and the consistency of that very strong growth, and you'll also hopefully notice that we had a particularly strong 2023 as we went into that, having focused on insurance.
And I think a lot of the energy that had been dedicated to some of our other businesses, now focused on insurance, demonstrated our clear potential to, at times, exceed the growth range of 6%-8%. Now, as I said, we do sit at the center of the global insurance industry, and it's important to understand there are a lot of things the insurance industry does in very diversified ways. At the top front, you can see different aspects of insurance: life and annuity, property, auto. We provide the insurance industry an ability to estimate costs on losses. We provide standardized forms. We collect data from the industry. On the bottom side, we model extreme events like hurricanes and severe convective storms. We help to manage the casualty claims process.
A lot of value that we provide is in identifying and protecting the industry from fraud. We help them with marketing, and we are also engaged in providing a technology platform and data to the Lloyd's market or the London market for excess and surplus. So even though it's insurance, it is a very diversified role of functions on the underwriting and the claims side, and diversified in terms of U.S. versus domestic. And this industry is a massive industry, so we have the opportunity to deal with an industry that generates about $800 billion of gross written premiums, massive amount of expenditures, $500 billion. Their IT spend is $210 billion.
And so when you think about the $2.7 billion in revenue that we generate, it's a relatively small portion, and importantly, we are often able to enable them to provide substantially greater efficiencies in how they're spending that money. Again, making an investment in data or technology that the industry can extract value from at a much lower cost of ownership or investment. And you can see two different representations of what our revenue looks like relative to this massive industry expenditure. And so beneath that very strong financial performance are five elements that we think differentiate Verisk. One is we have an advantaged market position that developed out of our role as a utility of the industry.
And so we started off with a dataset that was a contributory dataset, and which still exists to this day, and also creates a model where the industry is comfortable sharing their claims data and their underwriting data because they want to see what the entire industry is experiencing in terms of loss, or they want to understand what other claims may be occurring so that we can potentially identify fraud. You know, that allows us to generate strong, growing revenues. It is a business, since we're moving electrons around, that has very high operating leverage. We create a lot of value for our clients.
We're able to by monetizing across the industry, grow revenues at a faster rate than we are growing our core expense base, which is predominantly compensation for our insurance professionals, and actuaries, and data scientists, and programmers. That generates a lot of attractive cash generation, and that produces a very strong balance sheet. It's difficult for us to maintain leverage in the business because our EBITDA growth is relatively high and the relative capital intensity is low. Now, if we think about those components, they are reflective of this broader dynamic of investing in the datasets and technology at a relatively low capital intensity.
We're, you know, designing a new software application, we're building a new dataset into an analytic that we have, and then monetizing that across the industry, all of which supports the exceptional strong top-line growth and strong returns on capital that we generate. And if we think about this journey that we've been on, as I mentioned, we started out as an industry utility. That gave us centrality, scale, stability of relationships within the industry. And then from that, we built a data infrastructure that the industry uses in their most important functions of underwriting and claims, in modeling and other activities. That gives us criticality. It gives us defensibility because it's very difficult to get the industry as a whole to provide data to any individual player that didn't start out with that advantaged utility role.
And it'll also allowed us to help the industry evolve as a whole, as opposed to having to convince companies one by one. That led, as data science began to emerge more significantly, in the early 2000s, to find new ways of leveraging those datasets with predictive analytics, with early, early applications in artificial intelligence and machine learning, to find ways to extract more value for the industry by applying that data science technology for the benefit of the industry and designing solutions.
Where we have taken initial steps, but where I feel the greatest opportunity for us is, as a company, is to extend beyond that data and analytics role to really serve as a data exchange or data network, where we are facilitating industry communication and industry activity at a market level and at a functional level, that provides a multiplier effect to value. It improves the overall efficiency of the insurance industry, which benefits not only the insurance companies, but also reduces the cost of insurance to end users, whether they're individuals or whether they're corporations, and of course, also provides continued operating leverage boost to us.
The insurance market as a whole is a very diffuse, and relative to securities markets that all of you are much more familiar with, is still a relatively inefficient marketplace with a lot of pockets of information that doesn't flow well. When we talk to clients, when I talk to clients, there are three primary messages that I hear from them. We just went through an extensive Voice of the Client exercise, and what we heard was, one, from our clients: "We want you to invest more in the datasets, improve the currency of the datasets that you have, expand the datasets that you have. That has real value to us." Two: "We want you to provide more insights. You have a lot of data.
You're in a better position to help us understand what all of this data means so that we can guide our strategies effectively." And third, and most relevant to this final point on the network, is: "We want you to help us connect more of the industry so that we can operate more effectively and more efficiently as an industry within product lines or within a marketplace." And so, that's why I think we're particularly excited about some of the work that we've done in London, with a platform that we have called Whitespace to connect brokers and underwriters, and why some of the progress that we've made in our claims business is building a claims ecosystem that connects carriers and, adjusters and contractors and insureds, to accelerate and automate more of that claims function.
No one else in the industry has the centrality and has the scale and has the datasets to be able to do this for the industry, which is why we're so excited about the opportunity that we have ahead of us. So I've talked a little bit about the privileged position that we operate in. You know, how do we capitalize on that? So you can see here are our estimations of the total addressable market in underwriting and rating on the left, and in claims on the right side. You can see these are large markets. We estimate our shares as about 12% and 15% respectively, and we expect that we should be able to penetrate those markets effectively.
Each of those TAMs, we believe, because of inflationary effects, because of increased risk, increased demand for insurance, that each of those are growing at slightly more than the low single-digit percentage annually. Our ability to maintain high single-digit growth will come from our ability to capture more and more market share here. We have in order to take advantage of that competitive position, very clearly defined strategic operating goals centered around client where historically we have been more of a product-oriented company. One direction that I felt was critical for us to develop as we returned our focus to insurance was strengthening the strategic client the client strategic dialogue.
This has been important because, one, I think it has substantiated the interest from our clients in having a more structural and strategic discussion around how we can support their objectives. How can we help them be more profitable? How can we find new channels for them to grow? How can we help them update their technology and datasets? We've intensified our industry engagement on industry bodies, including the Federal Insurance Office, with the NAIC, the National Association of Insurance Commissioners, and with various trade groups, to make certain that the industry knows that we are there to support their objectives. And that's paid dividends in terms of getting more feedback from them on what we can be doing to help them. Now, on the product side, we also continue to have a very strong product franchise.
We are focused on enhancing our existing solutions. We're also accelerating growth opportunities where there are new products that the industry has not adopted yet, and we are demonstrating the value that they can deliver, and that we will continue to expand our market horizons as we think about where we serve the industry. From a team perspective, one of the changes that we've made is to focus on a more results-oriented culture. I think previously we had been more aspirational, and so now there is a focus on what are we accomplishing? If we fundamentally care about what happens to individuals and the industry, and we have the knowledge that we've gained, then we have to hold ourselves accountable for the value that we can create for our business and within our business units and for the industry.
We're focusing on making sure that our previously siloed organizations in claims and in underwriting and other areas are beginning to talk together and thinking about how do we tie these datasets together. So, as an example, on the underwriting side, our actuaries would gather the datasets from losses. They would normalize those and share those with our clients, but our clients want more current information. And so we're working to take more real-time information from our claims business to identify trends in costs, severity of loss, and frequency of loss, so that we can begin to integrate some more predictive elements into the underwriting, the underwriting functions. So that would be, one example in which we're trying to, to develop. We're also trying to bring more talent from the industry into the business.
And if you've followed us closely, we've had a number of senior management changes within the business to try to bring some of that industry experience to the fore as we're developing these. And then I won't spend a lot of time on financial goals, but very clearly, we've defined revenue growth expectations, margin expansion expectations, capital return to shareholders, and return on invested capital, which is a particularly important discipline for me and for Verisk because of the amount of capital that we generate. We want to make certain that we're utilizing that judiciously to support the growth in the margin and returns. We try to focus on three key priorities: driving consistent growth, delivering that margin expansion, and ensuring that disciplined capital allocation.
On the growth front, we, as I described, earlier, on the bottom side, in our highly penetrated businesses, our core line businesses in forms, rules, and loss costs. We have been investing heavily in a reimagined initiative where those datasets and form functions, which had not been updated, in some time, we are investing in a three-year project to revitalize those. We're one year into that, and as I've talked about in some of our earnings calls, we've been very thrilled at the response that we've had from clients to the value that we're creating, their sense, their appreciation for the fact that we're now investing in these businesses more actively, and that we have been actually able to secure stronger renewal rates because of the value that we are creating there.
In Claims Solutions , one of the key initiatives has been expanding that ecosystem on the claims front, where we're delivering that network within that function, and that has enabled us to capture revenue from some of those partners, but also strengthen the relationships with our clients. In our extreme events platform, this is where we model natural extreme weather events like hurricanes, severe convective storms. We have been investing in an upgrade of our core economic model and are in the process of migrating that business into a SaaS platform, which will improve the speed and the quality and the efficiency of the services that we can provide to reinsurers and insurers that rely on those models to estimate their risk.
So at that foundation for those highly penetrated businesses, those are all supportive of growth, and then we look to enhance that in leadership in adjacent markets. We acquired a business that provides a low/no-code system in life insurance, that with our partnership, because of our stability and our reputation in the industry, it has opened up the doors for large insurers that might otherwise be somewhat cautious about signing up a small private company to redo their core technology platform, but that has performed incredibly well. In marketing, we are analyzing data to help the insurers better target their marketing activity. You know, that has been a business that hasn't done as well due to a lower level of marketing by the industry, given the industry's desire to pull back from underwriting in certain states where they can't achieve rate adequacy.
But we continue to believe that that is a growth opportunity for us, as we see a more normalized marketing environment. Specialty Business Solutions is an area where we have built a platform in the London market that has facilitated the account management within the insurers, but has also facilitated a more efficient exchange of information between brokers and underwriters within that marketplace. And a couple of months ago, there was a public announcement that Marsh McLennan, the world's largest insurance broker, was moving 90% of their London and international placement business onto that platform, which is a tremendous endorsement of our platform as a more efficient and more digitized environment for them to be transacting business.
Then finally, we have a business called Maplecroft, where we are applying our risk analytics, and supplementing that by an assessment of political risk, social risk, and environmental risk that provide additional lenses to corporations and asset managers. We've been integrating some of our extreme events weather data into that so that we can provide a broader and comprehensive view of risk that is relevant to insurers, because in areas of high social or political risk, natural disasters can tend to magnify loss experience. So we are tying together other dimensions of risk beyond just the the weather analysis that we've typically focused on. You know, complementing that product development, we have been focused on and have invested in our go-to-market strategy, where we are seeking to sustain and accelerate the sale of multiple products.
You can see here, we provide this generally on a biannual basis, an analysis of the number of products that we sell to our customers, and we've shown a consistent trend that we are able to increase the average number of products we sell to each customer across various size customers, from our top 10, 11-25, 26-100, and 100-500 companies. You can see among the smaller companies, they tend to not write as many lines of business, or they may be more geographically constrained. But in each case, this is a demonstration of our ability to develop new products and effectively increase what we are selling to any individual insurance company.
And then we also seek to drive that growth through a variety of innovation approaches, from sustainable innovation around our existing products, transformational innovation, where we have found a new solution to accelerate the delivery of data to inform underwriting decisions, as we have with our, our LightSpeed, as well as the Core Lines Reimagine project that I described before. Disruptive innovation, where we are bringing a new technology as we are in the life insurance business, and we also look at efficiency innovation to maintain our operating leverage and to achieve margin expansion.
One thing that we've done is we've invested in a new technology that allows our field survey force that goes around and surveys commercial buildings for their engineering specifications and risk specifications to expand the amount of data that we're capturing and improving the efficiency with which we can take that data and deliver it directly to the insurance industry while also customizing it for their specific needs. We have a case study here on our Core Lines Reimagine project, where on the left, you can see that we, we base this on proprietary content we receive from the industry.
From that, we build policy forms, we provide industry standard rules for pricing insurance that the industry relies on and adjust to make their pricing decision, and we provide loss costs to the industry so that they can be informed by the full industry view of what's taking place. And our Core Lines Reimagine is focused on extracting more insights, as I've described, that our clients are asking for, improving the efficiency of their digital absorption of that information and interpretation, and allowing them to interact both with each other and with Verisk to help them make these decisions more effectively. And the value that has been perceived has driven very strong renewal pricing discussions at this early stage. The second priority that I mentioned is multiple levers of margin expansion.
We have natural operating leverage, as we've described. We want to maintain and enhance that. It's a function of the nature of what we, what we do in being able to make an investment and monetizing it across the industry. But we aren't relying just on that. We are looking for where we can find efficiencies through our migration to the cloud, which was a significant efficiency for us, more from a capital standpoint, but it also provided a reduction in our, in our operating costs. We have also used global talent outsourcing. We have significant centers in Hyderabad. We just opened a new office in Hyderabad, to expand our headcount there.
We also have a particularly strong office in Kraków, Poland, where we just celebrated our fifth-year anniversary as a data science center that has been utilized across our businesses. So we are looking to make sure that we're making the right geographic decisions. And then, we also look for portfolio impacts that, for some of our faster growth businesses, particularly acquisitions that are at an earlier stage, they may be lower margin businesses, but our objective, of course, is to realize the operating leverage to drive margin impact. But you'll hear us talk about how acquisitions will have a portfolio impact on what we do, all of which should support our broader mission of margin expansion, consistent with the guidance that we've provided at Investor Day. And then finally, ensuring a disciplined capital allocation.
We prioritize organic investment where we can generate high returns. We do look at selective M&A, where we think we can add value. So we're not in the business of saying we're building a portfolio of InsurTech businesses, but we need to know that it's something that's relevant to our clients that we can enhance and create more value from. We maintain a very strong balance sheet. Our objective is to maintain 2x-3x debt to EBITDA, EBITDA leverage. And for capital that we can't generate an adequate return on, we don't warehouse it, we return it to shareholders. With the sale of our energy businesses and financial services business, we return approximately $4 billion in capital to our, to our shareholders, and we'll continue to maintain that discipline with free cash flow generation that we have.
So that really is the summary. You know, this, the information on the consistent growth and capital return is available on our, on our website. I will just, you know, touch on our Investor Day targets. You know, at 2023, we're targeting organic constant currency growth of 6%-8% annually, operating leverage driving that to 7%-10%, Adjusted EBITDA margin expansion of 54%-55% in 2024, and we believe that we should be able to sustain a 25-75 basis point expansion in 2025, all of which contribute to double-digit EPS growth.
If you think back to that original chart, I'm sure it's not lost on you that at those levels, our ability to deliver compounding value creation over multiple years, given the stability of our business, is a core part of our value creation proposition. So we really look to leverage all of those factors to deliver that consistent and predictable growth. So with that, well, I have less than a minute remaining on the clock, so I haven't lost my chops yet in delivering this.
Yeah, we'll, we'll be moving to Adler for the breakout, for anyone who's interested in continuing the conversation. Thanks, Lee.
Okay. Thank you.