When do dividends typically get issued to policyholders?

Dividends are typically issued to policyholders at the end of the policy year. This timing aligns with the insurer's annual accounting procedures, where they calculate their overall financial performance and any surplus available for distribution. By the end of the policy year, insurers assess their profitability and determine whether they have excess funds, which can then be returned to eligible policyholders in the form of dividends.

This annual issuance allows policyholders to benefit from the insurer's financial success and can be viewed as a reward for being part of a mutual insurance company, where policyholders are also the owners. Since dividends are based on the insurer's performance, the timing ensures that the calculations are accurate and reflective of the company's financial status throughout the year. Moreover, this regular schedule can help policyholders plan for any financial benefits they receive from their insurance products.