Foresters Financial Holds Dividend Rate Steady, Signaling Strength

TORONTO, ON – May 28, 2026 – In a move that signals both financial strength and a commitment to its members, Foresters Financial announced today it will maintain its Canadian Dividend Scale Interest Rate (DSIR) at 6.25% for the second consecutive year. The decision provides a significant measure of stability for policyholders in an economic environment marked by caution and uncertainty.

This consistent rate applies to both new and in-force participating life insurance certificates for anniversaries occurring between May 1, 2026, and April 30, 2027. The announcement stands out against a backdrop of a Canadian economy where the central bank's policy rate sits at 2.25%, underscoring the robust performance of the insurer's participating account.

A Beacon of Stability in Uncertain Waters

For participating policyholders, the consistency of the DSIR is a crucial element in their long-term financial planning. In an era where market volatility can create anxiety for investors, Foresters' ability to hold its rate steady offers a welcome dose of predictability. This 6.25% rate is not a simple savings account interest rate; it is a key component in the formula that determines the annual dividends paid to owners of participating whole life policies. These dividends, while not guaranteed, can significantly enhance a policy's cash value and death benefit over time.

The stability is particularly noteworthy when compared to broader market indicators. With the Bank of Canada holding its key lending rate at 2.25% and 5-year government bond yields hovering just over 3%, the 6.25% figure from Foresters points to a successful long-term investment strategy that is performing well above standard benchmarks. This allows policyholders and their financial advisors to project future policy growth with a higher degree of confidence, reinforcing the role of participating life insurance as a cornerstone for wealth accumulation, estate planning, and intergenerational wealth transfer.

The decision reflects a disciplined approach to managing the company's participating account, which is a pool of assets backing the policies. "Our ability to maintain the DSIR is a testament to our prudent management and the strength and stability of the Par Account," stated Alvin Sharma, Global Chief Financial Officer for Foresters Financial, in the official press release.

The Strategy Behind the Strength

Maintaining a competitive DSIR for a sustained period does not happen by chance. It is the result of a deliberate and forward-thinking investment philosophy. Foresters attributes its success to a "modernized and diversified" approach to managing its Canadian participating portfolio. The organization partners with what it describes as "best-in-class investment managers" across a range of asset classes.

This strategy is designed to achieve durable, long-term growth rather than being swayed by short-term market fluctuations. By diversifying its investments—likely across a mix of stable fixed-income assets, equities, real estate, and alternative investments—the insurer mitigates risk and builds a portfolio resilient enough to weather economic turbulence. This active management style is crucial for generating the returns necessary to support a strong dividend scale.

It is important for policyholders to understand that the DSIR is one of several factors influencing their dividend payments. As the company notes, other factors include mortality experience (the number of death claims paid), operational expenses, policy terminations, and taxes. A stable DSIR is a strong indicator of positive performance in the investment component, which is often the most significant variable in the dividend calculation.

More Than a Balance Sheet: The Fraternal Model

Underpinning Foresters Financial's financial performance is its unique corporate structure. As a fraternal benefit society, its mandate extends beyond generating profit for shareholders. For over 150 years, the organization has operated with a dual purpose: providing financial security for its members and empowering them to contribute to community well-being.

This purpose-driven model may be a key contributor to its long-term stability. A focus on member benefits rather than quarterly earnings reports can foster a more patient, long-term investment horizon. The company's profits are reinvested to benefit members through dividends, exclusive benefits like competitive scholarships, and community support grants. This creates a virtuous cycle where financial strength enables greater community impact, which in turn reinforces member loyalty and engagement.

This long-term perspective is validated by external rating agencies. For 25 consecutive years, The Independent Order of Foresters (the legal entity behind the Foresters Financial trade name) has received an "A" (Excellent) rating from A.M. Best. This rating reflects the company's robust balance sheet, strong operating performance, and excellent ability to meet its ongoing obligations to policyholders. It is a powerful third-party endorsement of the financial health and prudent management that makes announcements like the steady 6.25% DSIR possible.

The company's commitment to sustainability and social responsibility is not just a footnote but is central to its identity. By aligning its financial goals with a broader mission of societal good, Foresters has built a resilient organization that continues to deliver consistent value to its members, even as the economic landscape shifts. This approach demonstrates that financial success and a strong social purpose can be mutually reinforcing.