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W.R. Berkley Returns More to Investors with 8% Dividend Hike

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The board of directors of W.R. Berkley Corporation (WRB - Free Report) approved an 8% hike in its quarterly dividend. The company will now reward investors with a quarterly dividend of 13 cents as against 12 cents paid on Apr 5, 2016. Shareholders on record as of Jun 15 will receive the higher dividend on Jul 5, 2016. The new dividend translates to an annual dividend of 52 cents per share.

Based on W.R. Berkley’s closing share price of $56.50 as of May 25, the increased dividend translates to a yield of 0.9%. Importantly, the insurer has increased its dividend by 11.7% in the last five years, higher than the industry’s dividend growth rate of 9.7%.

W.R. Berkley had last increased its dividend by 9% to 12 cents in the second quarter of 2015.

With about 122.8 million shares outstanding at the end of the first quarter, the company has to pay about $16 million quarterly or $63.9 million annually as dividend. The company’s robust capital position supports its payout.

W.R. Berkley remains committed to enhance its shareholders value via dividend hikes and share buybacks. In fact, the company repurchased 0.7 million shares in the first quarter of 2016 and has 8.2 million shares remaining under its authorization. This Zacks Rank #3 (Hold) insurer’s competitive dividend payouts and commitment to long-term shareholder value creation makes it an attractive pick for yield seeking investors.

Some other insurance companies too recently raised their dividend payouts. Marsh & McLennan Companies (MMC - Free Report) approved a 9.7% hike in its quarterly cash dividend, while Chubb Limited (CB - Free Report) increased its quarterly dividend by 3%. Also, The United Insurance Health Corp. raised its payout by 20%.

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