Aviva’s raised dividends in nine of the last 10 years. The only blip came at the start of the decade, a period when half of FTSE-listed companies cut, cancelled or postponed shareholder payouts due to the pandemic:

Even after 2019’s blip, ordinary dividends here have risen at a robust annual average rate of 5.9%. Aviva’s also paid special dividends in the period. All this means is Aviva’s dividend yield averaged a stunning 6.6% during the past decade.

It leaves the FTSE 100 long-term average of 3%-4% firmly in the dust.

But past performance isn’t always a reliable guide to future returns. So investors today need to ask themselves two important questions: what’s made Aviva such a dividend powerhouse, and can it keep delivering impressive passive income streams?

Five reasons why

Any high-quality dividend stock requires durable cash flows. And Aviva has that in spades. Its gigantic general insurance provides recurring premium income it can distribute to shareholders. Premiums are less predictable for its life and health units, though so far they’ve remained relatively stable.

Over the last decade, the company’s also scaled back its geographic footprint. This has had two major benefits for dividends: exiting less profitable overseas operations freed up cash, while capital allocation also improved.

Significant restructuring has also seen it focus more on capital-light businesses. The result? A more robust balance sheet — Aviva’s Solvency II capital ratio is a formidable 180% — and less cash is needed to reinvest in the business. Encouragingly, the firm’s targeting three-quarters of earnings from capital-light operations by 2028.

Finally, Aviva’s benefitting from structural tailwinds that are driving profits and dividends steadily higher. Rising interest in financial planning is also driving business at its wealth unit. And an ageing population means demand for its retirement products is growing sharply.

So what next?

Aviva’s profits could come under pressure if inflation continues to build. Weakness in the UK economy is another threat that could persist beyond 2026. Both have the potential to hit demand for its discretionary financial products.

But this isn’t likely to derail the company’s progressive dividend policy, according to City brokers. Payouts of 41.7p and 44.6p are forecast for this year and next respectively. The result? Juicy dividend yields of 6.7% and 7.1% respectively.

I believe Aviva shares can deliver on these bright projections for the reasons I’ve discussed and are worth considering. And looking longer term, I’m optimistic strong growth in the broader financial services market will drive dividends consistently higher.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Royston Wild owns shares in Aviva.

The post How have Aviva shares become a dividend juggernaut? 5 reasons why appeared first on The Twelfth Magpie.

The best passive‑income stocks share three qualities, in my view: rising earnings, strong and consistent cash flow, and management committed to increasing dividends.

When a company delivers all three, the income stream becomes both reliable and scalable over time. And insurance and investment giant Aviva (LSE: AV) is a good example of precisely this kind of stock.

Rising earnings growth and cash flow?

The powerhouse for any firm’s dividends over time remains sustained earnings growth, which in turn fuels free cash flow.

A risk for Aviva is a downturn in UK consumer and corporate confidence that could slow new business volumes. Another is prolonged pressure on markets, which could reduce fee income.

However, analysts forecast Aviva’s earnings will increase by an average of 14.5% a year to end-2028 at least. This looks conservative to me, given its 2025 results released on 5 March.

They showed operating profit jumping 25% year on year to £2.2bn, underlining the strength of the diversified insurance, wealth and retirement business model. Cash remittances edged up to £2.1bn, demonstrating the group’s ability to turn earnings into dependable, repeatable cash flow.

And management now targets more than £7bn of cash remittances between 2026 and 2028, giving exceptionally strong visibility for future cash flows.

Increasing dividends?

All this augurs well for Aviva’s ongoing targeting of mid-single-digit growth in the cash cost of its dividend.

Over the past five years alone (beginning in 2021), this has seen respective payouts of 22.05p, 31p, 33.4p, 35.7p, and 39.3p last year. These in turn generated average dividend yields in those years of 3.1%, 7%, 7.7%, 7.6%, and 5.7%.

The drop in some yields despite rises in the payout shows that dividend returns change in line with share prices (and payouts).

Looking ahead, analysts forecast continued rises in dividend yields to 6.7% this year, 7.1% next year, and 7.6% in 2028.

How much passive income potential?

So another £20,000 investment in Aviva shares by me could make £22,663 in dividends after 10 years and £174,133 after 30 years.

The figure assumes the projected 7.6% yield as an average, although this could go up or down over the period. It also factors in the dividends being reinvested into the stock to harness the full power of dividend compounding.

By the end of 30 years — the close of the standard long-term investment cycle — the holding’s total value would be £194,133 (including the initial £20,000).

And this would be paying me £14,754 in annual income from dividends alone by that point!

My investment view

Aviva combines rising earnings, strong cash generation and a clear commitment to growing dividends. These are the three key pillars of long‑term passive income, in my experience.

Add in its capital‑light momentum and strengthened balance sheet, and it is exactly the kind of dependable compounder I want more of in my portfolio. That is precisely why I will be buying more of the shares very soon.

For the same reasons, I think it well worth the consideration of other investors looking for major, long-term passive income.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Simon Watkins owns shares in Aviva.

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The Aviva share price has climbed 51.5% in five years. Normally, a rising share price squeezes the dividend yield. Not here. Today, the trailing yield is a chunky 6.4%.

By comparison, the FTSE 100 has risen 46.3% over the same period while yielding roughly 3.3%. My calculations suggest that an investor who put £10,000 into Aviva five years ago would now have £20,757, with dividends reinvested. The same sum in the FTSE 100 would have grown to £17,197. Nice, but Aviva is nicer.

Its growth is especially impressive because every dividend payment removes cash from the business and knocks the share price. Aviva has funnelled huge sums into shareholder pockets while still driving growth. It’s currently running a £350m share buyback programme too.

Why has Aviva outperformed rivals?

Aviva looks even sweeter when compared to FTSE 100 rival Legal & General Group. That one offers a richer yield of 8.2%, but its shares have slipped 2.75% over five years. With dividends reinvested, £10k in Legal & General would have grown to a more modest £14,422.

Ultimately, share value follows profits. Over the last five years, Aviva has delivered a solid rise in pre-tax profits.

• 2025 – £2.203bn
• 2024 – £1.767bn
• 2023 – £1.467bn
• 2022 – £1.350bn
• 2021 – £1.630bn

By contrast, Legal & General has struggled.

• 2025 – £1.623bn
• 2024 – £1.616bn
• 2023 – £1.667bn
• 2022 – £2.517bn
• 2021 – £2.265bn

Legal & General simply hasn’t given investors enough reason to chase the share price higher. Yet Aviva hasn’t always flown. I sold its shares a decade ago after they’d idled for years. I was a younger and more impatient investor then. I’ve learned my lesson.

Aviva has learned some lessons too. It’s shifted towards wealth management and workplace pensions, which generate recurring fee income without tying up huge amounts of capital. It’s also held its own in the competitive general insurance market.

The recent £3.7bn Direct Line acquisition could strengthen Aviva further if it delivers the promised synergies. However, it won’t be easy to integrate, so it could backfire.

Can Aviva keep delivering growth and income?

Aviva has a big opportunity in workplace pensions and bulk annuities, but this is a fiercely competitive sector too. General insurance claims inflation could hurt margins. Aviva’s Solvency II ratio has dipped from 203% to 180%. Legal & General’s is stronger at 210%, suggesting greater capital strength.

Today, the shares look pricey with a trailing price-to-earnings ratio of 23 against roughly 16 for the FTSE 100. However, the forward P/E drops to 11.8. The forecast yield stands at 6.8% this year and analysts expect 7.3% by 2027.

Personally, I think Aviva still looks well worth considering for investors seeking both growth and income. I’d buy it myself but I’m already heavily exposed to the financials sector. And I would add one warning. Investing moves in cycles and no stock gives investors a sugar rush forever. Even one as sweet as Aviva.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Harvey Jones owns shares in Legal & General Group.

The post Up 50% with a stunning 6.4% yield! How do Aviva shares do it? appeared first on The Twelfth Magpie.

Both Safestore (LSE:SAFE) and Aviva (LSE:AV.) shares have caught my attention at the start of June. Why are they both trading at bargain-basement levels?

Safe as houses?

Safestore is one of the most reliable FTSE 250 income shares out there. It’s raised its annual dividends for 16 straight years, and City analysts are expecting another rise in financial 2026. This leaves a 5% forward dividend yield.

That dividend resilience reflects the stock’s classification as a real estate investment trust (REIT). It has to pay at least 90% of yearly rental earnings out in dividends. So why is Safestore struggling to attract attention from value investors? Today its forward price-to-earnings (P/E) ratio sits at 8.9 times.

It’s true the outlook for REITs has changed since the start of the Iran war. The market had been expecting interest rate cuts that could boost asset values and reduce these firms’ borrowing costs. Now the Bank of England is tipped to hike rates in response to rising inflation.

There’s another more specific threat to Safestore, too. It doesn’t operate in a defensive sector like food retail or healthcare. As a consequence, it could see revenues fall if broader demand for self-storage spaces drops.

However, I still believe Safestore shares are changing hands far too cheaply today. And especially considering how robust trading has remained despite previous pressures. Latest financials showed like-for-like sales up 4.2% in the three months to January, while closing occupancy increased 1% to 77.8%.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice.

A 6.7% dividend opportunity?

Like Safestore, Aviva shares also look undervalued based on expected earnings. Forget about its unspectacular forward P/E ratio of 12.1. A sub-1 price-to-earnings growth (PEG) ratio suggests the FTSE 100 company offers outstanding bang for the buck.

So what’s the story here? Aviva provides a range of financial services, and is a particularly large player in general insurance. The problem is it also generates substantial profits (more than half, in fact) from more cyclical segments like asset management and life insurance.

But again, recent trading suggests the market could be overstating the threat of the Iran war to company profits. Last month, Aviva said it’s on track to grow operating earnings 11% on an annualised basis between 2025 and 2028. In my view, its market leading positions leave it in great shape to capitalise on demographic trends, helping it to grow earnings.

Things can change, of course. But even if profits do experience a temporary blip, Aviva’s strong balance sheet means I’m confident it can raise dividends for a seventh straight year in 2026. Its forward dividend yield is currently an enormous 6.7%.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Royston Wild owns shares in Aviva.

The post How are these FTSE 100 and FTSE 250 dividend stocks so cheap?! appeared first on The Twelfth Magpie.

I think it’s certainly possible.

In fact, looking at the FTSE 100, there are plenty of shares with very high dividend yields. One such is Aviva (LSE:AV.) with its 6.3% yield. This is more than double the Footsie’s 3% average.

Let’s see how investors might consider using its shares to try to pay their rent.

The road to passive income

Aviva shares currently trade for 620.8p, and over the last year, they’ve paid 39.3p in dividends. Therefore, investors would need to buy 42,168 to target £1,381 of monthly passive income.

This would be enough to pay the average rent in the UK. But it would cost £261,778.94 in total. It would be a risky strategy to put all that money into just one stock.

For example, as an insurance firm, Aviva is exposed to the insurance cycle. And it seems as though we are in a phase where there’s downward pressure on insurance premiums, which can impact the firm’s margins.

Investors may therefore want to think about diversifying their portfolio, so they can mitigate certain risks in individual companies, like Aviva’s. Many other UK stocks have high yields that could be considered.

Such shares include Legal & General, which has a yield of 8.1%. Looking outside the financial services industry, there are also the likes of British American Tobacco with a dividend yield of 5.2%.

Moreover, even with a diversified portfolio, I doubt many have £262k in spare cash. But all is not lost, as I believe investors can achieve this over time.

How many years?

Let’s go back to using Aviva shares as an example, and assume that on average they appreciate by 3% a year, and so does their yield.

If an investor started with £26,200, which is 10% of the target, and invested a further £262 a month, they would have the amount needed within 18 years.

Now, there’s no guarantee that dividends will be paid. It’s also highly unlikely that the average UK rent will remain at £1,381 per month, due to inflation. But it’s still a useful analysis. Furthermore, there are plenty of reasons why Aviva might be appealing right now.

Causes for optimism

So far in 2026, the insurance firm’s shares have declined by 10.3%. That might not sound like good news, but it also means the cost to obtain the firm’s future dividends is now 10.3% cheaper.

The company has also been performing well recently. In its first-quarter trading update, it saw general insurance premiums rise by 19% year on year to £3.4bn. This represents strong growth.

With a forward price-to-earnings ratio of 13.5, the company’s shares aren’t exactly expensive either. With all of this in mind, it might be a great entry point for investors to consider buying some Aviva shares.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Muhammad Cheema does not hold any positions in the companies mentioned.

The post How much is needed in an ISA for passive income that covers the UK’s monthly average rent of £1,381? appeared first on The Twelfth Magpie.

The FTSE 100 group is increasingly positioning itself around wealth, retirement and capital-light earnings alongside its insurance operations. So the more interesting question for investors may not be how much income it pays today — but whether this dividend stock is quietly becoming something more than just an insurance-focused dividend machine.

Diversified model

Insurance still sits at the heart of Aviva — but increasingly it may no longer tell the full story.

What stands out to me is how the business is evolving towards a more diversified and capital-light model, where growth is supported not only by underwriting profits but also by wealth, retirement and technology-driven efficiency.

Wealth looks particularly important here. It already manages more than £230bn of assets and continues to strengthen its position through workplace pensions, adviser platforms and direct wealth offerings. Record net flows of almost £11bn last year underlined that momentum.

The long-term backdrop also appears supportive. Management estimates the UK wealth market currently stands at around £2.7trn and could exceed £4trn by 2030, helped by regulatory tailwinds and growing retirement savings.

That matters because wealth income is typically more capital-light and recurring than traditional insurance earnings. Its wealth division is now approaching 10% of group earnings and remains on track for its £280m profit ambition by 2027.

Long term drivers

Retirement provides another structural driver. With the UK population ageing and a growing wave of pension savers approaching retirement, demand for retirement products and bulk annuities may remain resilient for years to come. Last year alone, Aviva wrote £4.6bn of bulk annuities.

Then there’s artificial intelligence. I don’t see this as a speculative story, but more as a productivity and customer-service opportunity. Aviva has spent years building machine-learning capabilities across pricing and claims, while its recent OpenAI partnership highlights ambitions to scale these tools further.

Taken together, this increasingly looks like a business supported by several long-term growth engines — not simply a traditional insurer dependent on underwriting conditions alone.

Risks

Of course, risks remain. Direct Line integration now becomes an important test, with synergies and operational execution needing to match expectations.

Wealth earnings are also partly linked to market conditions and asset values, meaning weaker investment markets could weigh on flows and fee income. And despite diversification, insurance remains cyclical, with claims inflation and pricing conditions capable of pressuring margins from time to time.

The bottom line

Some investors may argue that much of Aviva’s recent progress is already reflected in the share price. That may prove true over shorter periods.

But I think that risks missing the bigger picture.

The investment case here increasingly looks less about chasing rapid re-ratings and more about owning a business capable of compounding shareholder returns over time. Wealth, retirement and capital-light earnings are becoming more important contributors, while dividends and buybacks continue rewarding investors along the way.

For me, that creates a different type of FTSE 100 opportunity. Not necessarily the fastest-moving stock — but potentially a steadily evolving business capable of delivering attractive returns over many years.

It remains one I think investors could happily consider for the long term.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Andrew Mackie owns shares in  Aviva.

The post Aviva shares: is this FTSE 100 dividend stock becoming something more? appeared first on The Twelfth Magpie.

A Stocks and Shares ISA feels like the ideal home for those shares, because all my growth and dividends will be free of tax for life. If I could generate an income of £1,750 a month, I’d be more than happy. That works out as £21,000 a year. So how much do I need to generate that kind of income?

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

The answer depends on the yield achieved. Here’s the rough amount required:

• 4% yield: £525,000
• 5% yield: £420,000
• 6% yield: £350,000

As those figures show, a higher yield dramatically reduces the amount needed. Thankfully, plenty of FTSE 100 shares offer generous income today. One stock I wish I’d bought years ago is insurer and asset manager Aviva (LSE: AV). It currently offers one of the highest trailing yields on the blue-chip index at 6.3%.

Can Aviva keep paying such a generous income?

The Aviva share price has had a good run too, climbing 55% over five years. All dividends are on top. However, momentum has slowed. Over the last 12 months, the stock is up just 2.6%.

The Iran conflict has rattled markets. Investors worry that rising oil prices could push inflation higher again, which may keep interest rates elevated for longer and hit economic growth. That uncertainty has left Aviva looking a little choppy, despite several years of steady pre-tax profit growth.

• 2025 – £2.203bn
• 2024 – £1.767bn
• 2023 – £1.467bn
• 2022 – £1.350bn
• 2021 – £1.630bn

Some investors may also feel nervous about the valuation. The trailing price-to-earnings ratio stands at 23.3, well above the FTSE 100 average of around 16. I think that reflects expectations that growth may cool after a strong run. Although on a forward basis, based on 2026 earnings, it drops sharply to 12.1.

Analysts expect the dividend to keep climbing as well. The forecast yield for 2026 is 6.66%, and that’s expected to hit 7.11% in 2027. Dividends are never guaranteed, but those forecasts look highly attractive.

Should investors worry about the risks?

There are threats, of course. Aviva just spent £3.7bn buying Direct Line and now faces a big integration job. Combining systems, operations and staff is always risky. If management gets it wrong, anticipated cost savings could vanish. They might spiral instead.

Insurers also remain tied to the claims cycle. A run of expensive weather events or rising motor repair costs can quickly squeeze profits. Aviva has to keep hunting for new business, and while it’s found an exciting opportunity in the business pension risk transfer market, competition’s fierce.

Personally, I think it’s worth considering. The income prospects look excellent and the valuation doesn’t seem excessive on future earnings. That said, after such a strong five-year run, I might just watch and wait to see whether markets wobble this summer.

If Aviva dips, I’ll be tempted to buy it and bag that fabulous passive income.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Harvey Jones does not hold any positions in the companies mentioned.

The post How much do you need in an ISA to earn a £1,750 monthly passive income? appeared first on The Twelfth Magpie.

Just checking the 8% fall so far in 2026 might not make it look like that, but over five years we’ve seen a very nice 55% share price rise. And it’s on the back of one of the most impressive turnarounds I’ve seen in some time. It’s not as stunning as the Rolls-Royce Holdings recovery, perhaps — but Aviva’s return has pleased this dividend investor, for sure.

It means £10,000 invested back then should be worth £15,500 today. Oh, plus a nice bit of dividend cash too. Forecasts have the 2026 dividend yield at 6.3% — putting Aviva firmly among the top 10 FTSE 100 dividend stocks.

How’s 2026 going?

Now, it’s no good buying shares based on what they’ve already done. Obviously, we want to know what we might expect over the next five years. The 2025 full year saw operating profit rise by 25%, which helped push the annual dividend up by 10%.

And it sounds like the new year is off to a similarly good start, judging by Aviva’s Q1 update on 14 May.

We made excellent progress in General Insurance, growing premiums by 19% and improving profitability significantly in the UK, Ireland, and Canada. The integration of Direct Line is firmly on track with stronger profitability and policies sold through price comparison websites have nearly doubled since the start of the year.

CEO Amanda Blanc

Blanc’s worked wonders since she took control in 2020. And she continued this time saying: “Our continued strong trading performance, high quality balance sheet, and diverse set of leading businesses, gives us confidence that we are well placed to meet our group targets, and deliver even more for our customers and shareholders this year.“

What comes next?

So what should those customers and shareholders the boss spoke of expect? With a bit of luck, the following targets…

• Operating EPS showing 11% compound annual growth rate from 2025 to 2028.
• IFRS Return on Equity of greater than 20% by 2028.
• Cash remittances of more than £7bn cumulative between 2026 and 2028.

What do City analysts think might happen? Well, they might just be following what the company’s saying. Their forecasts put Aviva shares on forward price-to-earnings (P/E) ratio of 12 for 2026. And they see earnings rising enough to drop it to 9.5 by 2028. And they have steady dividend rises on the cards too.

What’s the verdict?

Aviva does face difficulties. The ongoing integration of Direct Line is a pretty big task, and it’s certainly not risk-free. And I don’t really rate that 2026 P/E valuation as dirt cheap for such a cyclical business. I wouldn’t predict another 50% in the next five years.

But for investors with a long enough horizon to even out sector cycles, I see Aviva shares as a worthwhile income candidate. I’m not selling mine, that’s for sure.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Alan Oscroft owns shares in Aviva.

The post £10,000 invested in Aviva shares 5 years ago is now worth this much… appeared first on The Twelfth Magpie.

Fortunately, the stock market provides such an opportunity, even if it involves more risk than throwing money into a cash savings account. All an investor essentially needs to do is buy a stock, sit back, and let the business and its managers work for them.

From little acorns…

When we talk about passive income from shares, we mean dividends. These are a proportion of the profit made by a company and distributed back to its owners (us investors), usually twice a year.

In the early days of investing, this might amount to nothing more than a few pounds. However, over time (and with a bit of luck), they should increase in value. This is especially likely if the owner reinvests what they get back into the stock. The more shares they own, the more income they should receive, at least in theory.

Importantly, not all stocks pay dividends. Moreover, not all those that do are created equal. Plenty of companies run into trouble for various reasons and are forced to reduce or even cut their cash returns completely.

But there are also a good number of UK-based firms that have shown they can consistently deliver.

Passive income powerhouse

One example, at least in my view, is financial services titan Aviva (LSE: AV). Its forecast dividend yield for 2026 stands at 6.6%, as I type.

Using this as a guide, a £10,000 investment in the company might deliver dividends of around £660. This isn’t an exact science because share prices are always moving. When the share price goes up, the yield goes down and vice versa, all other things remaining equal.

But Aviva’s income credentials go beyond that monster yield. In recent years, management’s record of increasing its total dividend has been solid.

This isn’t surprising given the progress CEO Amanda Blanc has made in streamlining the business to become more focused on its home market. Operating profit jumped 25% to £2.2bn in 2025, helping the insurer to hit its 2026 targets a year early.

A word of warning

As enticing as this all looks, dividends are never guaranteed, regardless of which stock we’re talking about. Like all companies operating in the financial sector, Aviva’s outlook is always tied to the health of the economy. When the next crisis arrives (and we can be reasonably confident that one eventually will), things could get tough.

This is precisely why I said ‘forecast yield’ a little earlier. This simply means that analysts have done their sums and made a prediction on how much might be distributed to holders for every share they own as things stand. It’s not nailed on.

But this, of course, underlines why we’re such fans of spreading money around the market at The Twelfth Magpie. Owning several income-generating stocks still doesn’t guarantee anything. But it reduces the risk that comes from only backing one horse (or business).

So yes, I reckon Aviva could act as a great starting point for a new investor to consider. It’s far from the only option though.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Paul Summers has no position in any of the shares mentioned

The post £10,000 in this FTSE 100 stock buys £660 in passive income this year appeared first on The Twelfth Magpie.

So is this now a no-brainer buy for my portfolio? And could I potentially unlock a lifetime of passive income?

What’s powering the 6.3% yield?

The headline yield isn’t an accounting trick. It’s being fuelled by genuinely strong earnings.

In 2025, Aviva delivered its fifth consecutive year of “strong, profitable growth”. Operating profit jumped 25% to £2,203m, operating earnings per share rose 17% to 56p, and return on equity hit an impeccable 17.5%.

That kind of performance is exactly what you want underpinning a high yield. And shareholders have felt it directly. The total dividend per share was increased by 10% to 39.3p for 2025.

Digging deeper, a big part of this momentum comes from Aviva’s core engines. General insurance premiums grew 18% to £14.1bn, with strong profitability across the UK, Ireland and Canada. Meanwhile, its wealth arm attracted record net inflows of almost £11bn, helping push assets under management to over £230bn.

Then there’s the pension risk transfer (PRT) market. In simple terms, this is where corporate pension schemes pay insurers like Aviva to take over their long-term liabilities, swapping uncertain obligations for a fixed insurance contract.

The UK PRT market is expected to reach about £70bn of deals in 2026 alone, and consultants flag Aviva as one of the key players. That’s a huge, long-duration profit pool if the company can capitalise on it correctly.

So why then are institutional investors seemingly growing cautious?

Where’s the risk?

On the surface, this all sounds like an income investor’s dream. But big institutions are not treating Aviva as a slam-dunk.

One obvious concern is the Direct Line deal. Aviva’s in the process of integrating the motor and home insurer following its £3.7bn acquisition. Analysts at Jefferies have described the deal as financially compelling but warned about the massive integration risks that come with deals of this size.

What’s more, beyond stiff competition, there’s also the basic fact that Aviva is becoming more exposed to the insurance cycle.

That means more sensitivity to claims inflation, severe weather, and regulatory pressure. And while the PRT market’s booming, it also creates long-duration liabilities for the business – a significant risk if investment returns or credit markets start to misbehave.

Is this still an opportunity?

As I see it, Aviva’s delivering exactly what income investors want to see: rising profits, strong cash generation, and a well-covered and growing dividend.

Management’s already hit its 2026 financial targets a year early and is now guiding for 11% annual EPS growth and a return on equity above 20% by 2028.

Yes, the Direct Line deal and a heavier tilt toward general insurance raise the risk profile. But they also expand Aviva’s scale and earnings power if integration is executed well.

Combine that with a 6.3% yield that’s backed by real cash, and I think there’s a strong case that Aviva shares could form the backbone of a long-term passive income strategy. That’s why I’m already considering the business for my own income portfolio.

Should you invest £5,000 in Aviva Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Aviva Plc made the list?

Zaven Boyrazian does not hold any positions in the companies mentioned.

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