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Insurance giant Aviva (LSE: AV) stands out to me as one of the FTSE 100’s most reliable income engines. It offers investors a blend of resilient cash generation, disciplined capital allocation, and a strong dividend profile.
Its simplified UK, Ireland and Canada focus gives the group a steadier earnings base and clearer dividend visibility. Meanwhile, the Direct Line acquisition looks set to expand operational and long-term cash flow, further boosting earnings (‘profits’) growth. And it is this that ultimately powers any company’s dividends over time.
So, how much dividend income are we looking at here?
Underpinned by strong earnings growth
A risk to Aviva is the intense competition in the insurance sector, which could squeeze its margins over time. Even so, the consensus forecast of analysts is that its earnings will grow by an annual average of 14.3% to end-2028.
This looks well-founded to me, given recent results. H1 2025’s operating profit soared 22% year on year to £1.068bn. General Insurance premiums increased 7% to £6.29bn, and its Health division’s premiums jumped 14% to £1bn.
Its Wealth division’s assets under management increased 6% to £209bn. This cemented its position as the largest provider of workplace pensions and retail wealth products in the UK.
At that point, Aviva increased its profit target for 2026 to £2bn.
This positive momentum carried through into its Q3 trading update. General Insurance premiums rose 12% to £10bn, and Wealth net flows increased 7.7%. At that stage, Aviva said it was on course to beat its £2bn 2026 operating‑profit target a full year early.
As such, it has raised its target to ‘around £2.2bn’ for full-year 2025. Positively as well, this includes around £150m from the integration of Direct Line.
Dividend income potential
£20,000 would buy investors 3,106 shares in Aviva at the current £6.44 price.
Given the strong earnings growth forecast by analysts, the dividend is expected to rise from the present 35.7p to 41.4p this year, 44.5p next year, and 46.9p in 2028. These would generate respective yields in those years of 6.4%, 6.9%, and 7.3%.
So, those 3,106 shares would make £21,410 in dividends after 10 years, and £157,523 after 30 years. This is based on the projected 7.3% as an average, although this could go down too over the period.
It also assumes the dividends are reinvested back into the stock to effectively supercharge the income through ‘dividend compounding’. This is a similar idea to leaving interest to accrue in a bank savings account.
By the end of the 30 years, the 3,106 shares in Aviva could be worth £177,523 (including the original £20,000 investment). And this could be paying an annual income from dividends of £12,959!
My investment view
Aviva feels to me like a classic long-term income compounder: focused, cash‑generative and confident in its ability to grow profits and dividends.
The Direct Line deal strengthens that momentum, while upgraded guidance shows a business hitting its stride.
With market-leading scale in pensions, rising earnings and a progressive dividend policy, Aviva offers the kind of steady, cumulative return profile that rewards patient investors over decades.
And I, for one, will be adding to my holding in the company very soon.
