Verisk Analytics, Inc. · NASDAQ:VRSK

Verisk Analytics — Verisk Emerging Issues Webinar June 2024

41 slides from Verisk Analytics's conference presentation, June 2024

1. Slide 1: The Emerging Risks to Watch in 2024

   The Emerging Risks to Watch in 2024 An Emerging Issues Presentation ©Verisk Analytics, Inc. All rights reserved. 1

2. Slide 2: Policy Statement

   Policy Statement The policy of Verisk Analytics and subsidiary companies is to comply in all respects with federal and state antitrust laws. With this in mind, we want to mention that during all seminars held under our auspices, this policy prohibits discussion of certain topics. Because we want to

3. Slide 3: What's Top of Mind?

   What’s Top of Mind? ©Verisk Analytics, Inc. All rights reserved. 3

4. Slide 4: Microplastics

   Microplastics ©Verisk Analytics, Inc. All rights reserved. 4

5. Slide 5: Microplastics 101

   Microplastics 101 What they are, and where they come from • Tiny plastic, big problem. Small plastics measuring less than 5 millimeters in diameter • Primary vs. secondary. Some intentionally designed (e.g., nurdles) while others result from plastic degeneration (e.g., used water bottles) • All shap

6. Slide 6: Microplastics: The Nurdle Problem

   Microplastics: The Nurdle Problem Understanding these foundational and problematic plastics • The building blocks. Lentil-sized pre- production plastic pellets used in a wide array of products • Small escape artists. Often enter environment during manufacturing and transport • Ocean scourge. Nurdles

7. Slide 7: Microplastics: Exposure and Entry Points

   Microplastics: Exposure and Entry Points How do they get into the natural environment? Runoff and Stormwaters Environmental Degradation Industrial Effluence • Storms, runoffs, and winds transit • Result from fragmentation of larger • Released into the environment via microplastics to oceans plastics

8. Slide 8: Microplastics: Environmental Impact

   Microplastics: Environmental Impact Microplastics in our seas, soil, and wildlife • Eight million tons of plastics reach oceans each year • Microplastics can be consumed by marine mammals and aquatic life • Seventy-five percent of commercial fish have ingested plastic, according to one report • Plas

9. Slide 9: Microplastics: Human Health Impacts

   Microplastics: Human Health Impacts The bodily risks posed by microplastics • Recent research has found microplastics in human blood and all regions of the lung • Microplastics have been detected in drinking water and food supply chains • Chemicals may, according to research, disrupt the endocrine s

10. Slide 10: Microplastics: Litigation Risks and Trends

    Microplastics: Litigation Risks and Trends How microplastics are playing out in courtrooms • Class action lawsuits regarding microplastics on the rise • One case alleges bottled water manufacturers claims of sustainability were false advertising • Petrochemical industry alone could face billions in

11. Slide 11: Microplastics: State, Federal and International Regulation

    Microplastics State Efforts to regulate microplastics • California leads the way for state efforts to regulate microplastics. • Most common efforts are aimed at single use plastic bans, microbeads in personal care products, and recycling efforts. • Some states prevent regulations of microplastics. F

12. Slide 12: Social Inflation

    Social Inflation ©Verisk Analytics, Inc. All rights reserved. 12

13. Slide 13: Tort Reform/Social Inflation

    Tort Reform/Social Inflation Third Party Litigation Financing (TPLF) ❑ Enacted Legislation (IN, WV) ❑ Failed Efforts (FL, LA, etc.) Federal TPLF Efforts ❑ “Protecting Our Courts from Foreign Manipulation Act of 2023.” ❑ To date, there are no federal rules that explicitly require the disclosure of TP

14. Slide 14: General Liability Overall vs. Commercial Umbrella/Excess

    General Liability Overall vs. Commercial Umbrella /Excess Overall Loss Ratio includes Premises/Operations, Products/Completed Operations, Composite Rated Risks, and Commercial Umbrella/Excess data. Bulk reserves are not included, and a consistent number of accident years are included in each calenda

15. Slide 15: Social Inflation Looking Forward (Revisited)

    Social Inflation Looking Forward (Revisited) Drivers of Social Inflation • Have they been impacted? Civil Courts and Slower Settlements • Some progress Higher Policy Limit Loss Experience Changes • Generally worsening experience in Commercial Auto (2023/2024) and General Liability (2024) • Increased

16. Slide 16: Potentially Broad Impact of Social Inflation on Insurance Company Operations

    Potentially Broad Impact of Social Inflation on Insurance Company Operations • Claims • Actuarial • Coverage ©Verisk Analytics, Inc. All rights reserved. 16

17. Slide 17: Autonomous Vehicles

    Autonomous Vehicles ©Verisk Analytics, Inc. All rights reserved. 17

18. Slide 18: The Levels of Autonomy

    The Levels of Autonomy Level zero Level one Level two Level three Level four Level five • Momentary • Driver • Additional • Conditional • High • Full driver assistance assistance automation automation automation assistance ©Verisk Analytics, Inc. All rights reserved. 18

19. Slide 19: Autonomous Vehicles

    Autonomous Vehicles Going (mostly) strong since 2015…. ✓ Runner-up in 2015 ✓ Top eight finish in 2016 ✓ Top pick in 2017 ✓ Final four in 2018 ✓ Second round elimination in 2019 ✓ Runner-up in 2020 ✓ Final four in 2021 ✓ Top eight finish in 2022 ✓ First round elimination in 2023 ©Verisk Analytics, In

20. Slide 20: Autonomous Vehicles: Government Activity

    Autonomous Vehicles: Government Activity Since 2017, over 25 states have put laws on the books addressing driverless vehicles ➢ Kentucky most recent with HB 7 in 2024 Varying levels of autonomy Insurance Requirements Federal Regulations ➢ NHTSA federal guidelines ➢ Expected Federal Motor Carrier Saf

21. Slide 21: Autonomous Vehicle Testing

    Autonomous Vehicle Testing State of Play 2024 AV Testing by Vehicle Type Van Tractor Trailer Shuttle Other Light Truck Heavy Truck Delivery Robot Car 0 2 4 6 8 10 12 14 16 18 20 Source: NHTSA ©Verisk Analytics, Inc. All rights reserved. 21

22. Slide 22: Autonomous Vehicle Testing

    Autonomous Vehicle Testing ©Verisk Analytics, Inc. All rights reserved. Source: NHTSA (Data as of May 2024) 22

23. Slide 23: Autonomous Vehicle Commercial Deployment

    Autonomous Vehicle Commercial Deployment Robotaxis, robotrucks Robotaxis Robotaxis Robotrucking Robotrucking today: tomorrow: today: tomorrow: • Phoenix, AZ • Austin, Texas • Dallas-to- • Dallas-to- • Los Angeles, (2024) CA Oklahoma Houston (2024) • San Francisco, CA • Laredo-to- • Las Vegas, Dallas

24. Slide 24: Autonomous Vehicles: Miles to go

    Autonomous Vehicles Miles to go…. AVS: 70 MILLION MILES ON HUMANS: 3.1 TRILLION PUBLIC ROADS MILES PER YEAR ©Verisk Analytics, Inc. All rights reserved. 24

25. Slide 25: AV Experience: By the Numbers

    AV Experience: By the Numbers Autonomy Levels 3-5 70 MILLION MILES TRAVELED 1,164 INCIDENTS 0 FATALITIES REPORTED ON PUBLIC ROADS Human drivers: 1.3 fatalities every 100 million miles NHTSA currently investigating four autonomous vehicle firms ©Verisk Analytics, Inc. All rights reserved. 25

26. Slide 26: AV Safety

    AV Safety The view from one robotaxi firm ❑ After roughly 7 million miles driven there were 3 injury-causing robotaxi accidents disclosed by a robotaxi firm ❑ Humans on the same roads and same mileage may result in 4x as many crashes (not necessarily injury-causing) ©Verisk Analytics, Inc. All right

27. Slide 27: Autonomous Trucks

    Autonomous Trucks The view from one company Autonomous truck Human drivers ❑ ˜1 million miles driven ❑ 108 crashes per 100,000,000 miles ❑ 3 crashes reported (zero fatalities) ❑ 1.6 fatal crashes per 100,000,000 miles ❑ If AV accident frequency stays consistent… 300 crashes per 100,000,000 miles ©Ve

28. Slide 28: The Vision…

    The Vision… Let the robot do the driving ©Verisk Analytics, Inc. All rights reserved. 28

29. Slide 29: The Reality…

    The Reality… A longer road to the autonomous future? ➢ Remote human safety operators may be required ➢ Limited by climate conditions ➢ Areas must be thoroughly mapped – and maps must be constantly updated ➢ Vehicles can be confused by objects ➢ Autonomous trucking appears to be limited to simple, re

30. Slide 30: Autonomous Vehicles: A long and windy road ahead?

    Autonomous Vehicles A long and windy road ahead? Fast lane Slow lane ❑ Expansion of robotaxi and trucking ❑ Limited routes services ❑ Limited geography ❑ Introduction of more level 3 vehicles ❑ Limited use-cases for personal autos ❑ Semi-Autonomy ❑ Broadening geography ❑ Autonomous supply chains ©Ve

31. Slide 31: Autonomous Vehicles: Possible concerns along the way

    Autonomous Vehicles Possible concerns along the way… Privacy concerns Cyber Distraction exposures Who (what) is liable in an ©Verisk Analytics, Inc. All rights reserved. accident? 31

32. Slide 32: Rise of the Robots

    Rise of the Robots ©Verisk Analytics, Inc. All rights reserved. 32

33. Slide 33: Robots @ Work: Growing market penetration

    Robots @ Work Growing market penetration Commercial robots also used for: Over 500,000 industrial • Law enforcement robot installations in Electronics 2022 • Surgery • Property inspection Nearly 4 million in • Agriculture Automotive operation globally • Transportation (autonomous vehicles) • Care gi

34. Slide 34: Robots @ Work: That was then…

    Robots @ Work That was then… Workplace Injury Error/Malfunction Property Damage ©Verisk Analytics, Inc. All rights reserved. 34 Sources: See Appendix

35. Slide 35: Robots… Everywhere?

    Robots… Everywhere? The future? Autonomy Bias Data privacy “Hallucinations” ©Verisk Analytics, Inc. All rights reserved. 35

36. Slide 36: Verisk's Emerging Issues

    Verisk’s Emerging Issues • Weekly research articles • Curated newsfeed, updated daily • Weekly newsletter • Webinars • Audio features • Whiteboard sessions core.verisk.com/ei ©Verisk Analytics, Inc. All rights reserved. 36

37. Slide 37: Sources

    Sources Slide 5 – Microplastics 101 “Microplastics may increase riverbed sediment movement, erosion,” Phys.org, September 2023. https://phys.org/news/2023-09-microplastics-riverbed-sediment-movement-erosion.html “Encyclopedic Entry: Microplastics,” National Geographic. https://education.nationalgeog

38. Slide 38: Sources (Cont.)

    Sources (Cont.) “Micro/nano-plastics occurrence, identification, risk analysis and mitigation: challenges and perspectives,” Reviews in Environmental Science and Bio-Technology, January 2022. Slide 10 - Litigation, Risks and Trends https://www.ncbi.nlm.nih.gov/pmc/articles/PMC8792138/ “From Particle

39. Slide 39: Sources (Cont.)

    Sources (Cont.) Slide 23 (Cont) “After a year of setbacks, where do robotaxis go in 2024?” Government Technology. https://www.govtech.com/transportation/after-a-year-of-setbacks-where-do-robotaxis-go-in-2024 Safety Performance of the Waymo Rider-Only Automated Driving System at One Million Miles,” W

40. Slide 40: Sources (Cont.)

    Sources (Cont.) From Verisk’s Emerging Issues: The Potential Liability Exposures of the Rising Robotic Workforce Slide 29 (Cont) Slide 36 “Letter to the National Highway Traffic Safety Administration,” Sen. Markey, et. al., “4 Best Gutter Cleaning Robots In 2023,” Robot Chores, January 5, 2023. http

41. Slide 41: Thank you! Questions? Contact us

    Thank you! Questions? Contact us: emergingissues@verisk.com No part of this presentation may be copied or redistributed without the prior written consent of ISO. This material was used exclusively as an exhibit to an oral presentation. It may not be, nor should it be relied, upon as reflecting a com

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