If you are an income investor, you want to buy companies that are increasing their dividends. Why? If inflation averages 3.0% annually over a 10 year period, your dividends will have to grow by more than 34% or you are losing ground to inflation. Most insurers have exceeded this rate, but some have not. Travelers (TRV), for example, has increased its dividend only 20% in 10 years, while Cigna has cut its dividend over this time frame. And, importantly, dividend growth is evidence of business growth; a company will not aggressively raise its dividend unless it has the economic growth to support this policy. Below is a list of the 10 insurance companies with the highest rate of dividend growth over the last 10 years, adjusted for splits. They are domestic and foreign firms listed on the NYSE. A few have not been demutualized for the full 10 year period of study, and this has been noted. And, while LFC, China Life Insurance, has grown its dividend faster than any of the companies below (+911% since 2006) it has only paid a dividend for three years, and is therefore not included on the list.
AZ, Allianz SE, +514%, current yield = 4.9% (analysis since 2001)
AIG, American International Group, +566%, current yield = 3.5%
MFC, Manulife Financial, +380% (since 2000), current yield = 2.7%
AXA, AXA, +313%, current yield = 6.2%
MET, MetLife Inc., +270%, current yield = 1.4% (analysis since 2000)
ING, ING Groep, NG, +216%, current yield = 6.6%
PRU, Prudential Financial, + 188%, current yield = 1.9% (analysis since 2002)
ALL, Allstate Corp., +192%, current yield = 3.6%
HIG, Hartford Financial Services, +152%, current yield = 3.6%
SLF, Sun Life Financial, +112%, current yield = 3.6%
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