2 Insurance Stocks To Buy With Dividend Streaks Longer Th…

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Cincinnati Financial: 66 years and counting

Cincinnati Financial is based in Ohio, as its name implies. The company’s website states that it is “among the 25 largest property casualty insurers in the nation, based on net written premiums.” So it is a material business, but it isn’t exactly a huge insurer. The market cap is $24 billion. The dividend yield is currently around 2.3%, as of this writing, which compares favorably to the S&P 500 index‘s (^GSPC +0.73%) tiny 1% yield. The big dividend story, however, is that the company has increased its dividend annually for a huge 66 years.

Cincinnati Financial Stock Quote

NASDAQ: CINF

Cincinnati Financial

Premium Feature

Moneyball Superscore

79/100

Today’s Change

(-0.12%) $-0.20

Current Price

$161.95

Key Data Points

Market Cap

$25BMarket cap calculated using publicly traded s outstanding only. Does not include unlisted, private, or dual-class non-traded s. Implied market cap may vary.

Day’s Range

$160.95 – $162.74

52wk Range

$150.00 – $194.81

Volume

559.3K

Avg Vol

706.3K

Dividend Yield

2.28%

What investors need to keep an eye on with Cincinnati Financial is its investment portfolio. Most insurance companies focus on bonds, but Cincinnati Financial has material equity exposure, accounting for around 40% of its investment portfolio. By comparison, Progressive’s (PGR -0.31%) equity exposure is just 5%. Although Cincinnati Financial is clearly a reliable dividend stock with a decent yield today, a bear market would ly open up a more attractive buying opportunity. Indeed, the company’s equity focus is ly to prompt investors to dump its s during a market downturn, despite its impressive dividend history.

RLI: 51 years and counting (with an occasional bonus)

With a roughly $5 billion market cap, RLI is much smaller than Cincinnati Financial. While the majority of its business falls into the property and casualty space, it describes itself as a specialty insurer. For example, it has a sizable marine insurance business and also sells earthquake insurance. It probably needs a bit more monitoring than a business Cincinnati Financial.

That said, the equity component of RLI’s portfolio is roughly 20%. That’s higher than many insurers, but not nearly as high as Cincinnati Financial. The 51-year streak of annual dividend increases highlights that the company is run well. However, the yield is only about 1.3%, so it isn’t exactly a high-yield stock. But it has a history of paying sizable special dividends, including $2 per in 2023, 2025, and 2026. But it paid an even larget $4 per in 2024 and an almost shockingly large $7 per in 2022.

RLI Stock Quote

NYSE: RLI

RLI

Premium Feature

Moneyball Superscore

76/100

Today’s Change

(-0.43%) $-0.24

Current Price

$55.94

Key Data Points

Market Cap

$5.2BMarket cap calculated using publicly traded s outstanding only. Does not include unlisted, private, or dual-class non-traded s. Implied market cap may vary.

Day’s Range

$55.36 – $56.59

52wk Range

$45.42 – $67.00

Volume

839.3K

Avg Vol

746.2K

Dividend Yield

1.19%

You obviously can’t count on a special dividend, but RLI clearly has a plan to return value to holders through special dividends when it does well. And that can materially improve the income dynamics for long-term dividend investors.

Wish list or buy list?

Of these two Dividend King insurers, RLI looks the more attractively valued stock. Its price-to-book ratio is around 2.9x, well below its five-year average of 4x. Cincinnati Financial’s P/B ratio is roughly 1.5x, which is just a touch below its long-term average of nearly 1.6x. So, if you are on the lookout for a reliable dividend stock, RLI could be worth putting on your buy list. But Cincinnati Financial is probably better left on the wish list, just in case there’s a bear market.

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About the Author

Reuben Gregg Brewer

Reuben Gregg Brewer is a contributing Motley Fool stock market analyst covering energy, utilities, REITs, and consumer staples. He is the former director of research at Value Line Publishing, where he rose from mutual fund analyst to equity analyst before leading all research operations. Reuben holds a bachelor’s degree in psychology from SUNY Purchase, a master’s in social work from Columbia University, and an MBA from Regis University. He has been featured as a financial expert on CNBC and in the Financial Times, Barron’s, and InvestmentNews.

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Stocks Mentioned

Cincinnati Financial Stock Quote

Cincinnati Financial

NASDAQ: CINF

$161.95

(-0.12%)-$0.20

Stock Advisor

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—% Avg Return

S&P 500 Index Stock Quote

S&P 500 Index

SNPINDEX: ^GSPC

$7,722.72

(+0.73%)+$56.27

Progressive Stock Quote

Progressive

NYSE: PGR

$210.31

(-0.31%)-$0.65

RLI Stock Quote

RLI

NYSE: RLI

$55.94

(-0.43%)-$0.24

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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