A Year Later: Would I Still Buy Intact Financial for Its Dividend?

If you bought Intact Financial (TSX: IFC) a year ago, you probably weren’t chasing yield — you were betting on quality. Here’s whether that bet still holds up.

The most telling signs tend to be boring ones: steady premium or revenue growth, resilient margins, and a payout ratio that leaves room for reinvestment. If those pieces hold, the dividend starts to look less like a promise and more like a habit. So, what about this driver?

IFC

Intact Financial is Canada’s largest property and casualty insurer, with a big domestic business and a meaningful international platform through its U.K., Ireland, and European operations. It sells home and auto insurance, plus commercial coverage, and it makes money through underwriting discipline and investment income. Over the last year, the big theme has been “price for risk” in a world that still throws inflation, severe weather, and repair-cost pressure at insurers. Intact leaned into rate actions, tighter underwriting, and claims management, and it benefited from calmer catastrophe losses versus some tougher prior periods.

It also kept reminding the market that insurance can be one of the most quietly durable businesses when run well. In its third quarter of 2025, it posted a very strong quarter driven by premium growth and improved margins, supported by lower catastrophes and solid investment and distribution income. The dividend stock has also continued the kind of operational tightening it started after past acquisitions, and small improvements in combined ratio can move earnings a lot in this business.

Into earnings

The latest quarterly results underline why the market still respects it. In the fourth quarter of 2025, Intact reported net operating income per share of $5.50, up 12% year over year, with earnings per share of $5.24. It also delivered a combined ratio of 85.9%, which is a very strong underwriting result, and operating net investment income increased to $415 million. For an insurer, those numbers tell a clear story: It priced risk well, managed claims well, and still earned solid income on its investment portfolio.

The full-year picture looked even better, with net operating income per share growth well above its long-term objective. That matters for the dividend as you want earnings growth that can keep funding raises without pushing the payout ratio into uncomfortable territory. The company’s dividend has continued to rise, now at 2.3%, which signals confidence without trying to be flashy. That would mean a lot of income even from $7,000.

COMPANYRECENT PRICENUMBER OF SHARES YOU COULD BY WITH $7,000ANNUAL DIVIDENDTOTAL ANNUAL PAYOUT WITH A $7,000 INVESTMENTPAYOUT FREQUENCYIFC$260.4626$5.88$152.88Quarterly

Bottom line

So, would I still buy Intact Financial a year later? Yes, but the reason matters more than the yield. Intact is not a high-yielding workhorse, but it has looked like a high-quality dividend grower with strong underwriting, improving profitability, and a valuation that does not require perfection. If you want steady compounding with a rising dividend rather than a huge yield, it still looks like a name that can earn its place in a long-term Canadian portfolio.

It’s the kind of stock you might find featured in Stock Advisor Canada, where the quality of underlying businesses matters more than dividend sizes. If that’s how you invest, Stock Advisor Canada is worth checking out.

The post A Year Later: Would I Still Buy Intact Financial for Its Dividend? appeared first on The Motley Fool Canada.

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More reading

• 5 TSX Dividend Stocks I’d Jump to Buy When the TSX Pulls Back
• The Best TSX Stocks to Buy Now if You Want Both Income and Growth

Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool recommends Intact Financial. The Motley Fool has a disclosure policy.