AFLAC Incorporated (NYSE:AFL) shareholders have had plenty to cheer about in 2017. This year, the company's stock price has increased almost 15%, a good deal better than the S&P 500's return over the same time period. For a company known more for its impressive track record of dividend growth than for delivering capital gains appreciation, that's not too shabby!

When the company reported its second-quarter earnings, revenue was basically flat year-over-year, coming in at $5.4 billion. Earnings growth, however, was strong: Year-over-year, net earnings increased 30% to $713 million and diluted EPS increased almost 36% to $1.79.

While there are several factors that have gone into Aflac's market-beating returns this year, one aspect that might have slipped under most investors' radars is a key partnership Aflac forged with the Japan Post Holdings in 2013 that has paid increasing dividends to the company. In 2016, more than 20,000 post offices sold Aflac plans through this agreement.

AFL Chart

AFL data by YCharts

Aflac's far out business in the Far East

Due to Aflac's iconic Aflac Duck, most Americans are at least somewhat aware that the company provides supplemental insurance to workers when they get sick or injured and have to miss work.

What many might not know, however, is that Aflac generates more revenue in Japan than within the U.S. In the second quarter, about two-thirds of Aflac's total revenue originated in that country. Aflac's presence in Japan is hard to overestimate as Aflac currently insures about 25% of Japanese households and is the country's largest provider of medical and cancer insurance.

Man sitting on couch with leg in cast propped up on ottoman.

Aflac sells supplemental insurance plans to customers in case they get injured or sick and can't work. Image source: Getty Images.

Aflac's distribution channels, or the way it sells plans to consumers, differ greatly in the American and Japanese markets. Domestically, Aflac relies exclusively on career agents and brokers to sell its plans, usually through employers and businesses.

In Japan, it conducts business a bit differently. While Aflac Japan still heavily depends on a network of 108,000 licensed sales associates, it has also entered into a number of strategic partnerships, mostly with banks and life insurance companies, to juice sales growth of its insurance plans.

Yet it was Aflac's partnership with the Japan Post that was singled out time and again by Aflac management in its second-quarter conference call for driving increasing amounts of sales growth.

This partnership can be "a game changer"

The Japan Post Holdings is a Japanese conglomerate that not only operates the country's postal system through a network of more than 20,000 post offices, but also offers financial services through its own banking and life insurance operations.

In Aflac CEO Daniel Amos's prepared remarks on the second-quarter conference call, taken from the transcript provided by S&P Global, he credited the four-year-old partnership by saying Aflac's results were "fueled" by the alliance.

Amos continued:

[W]ith respect to Japan Post in 2013, when we first announced our strategic alliance, I noted that the partnership will provide an important source of growth for the company today and to value our customers. I said at the time, that it would be a game changer. Today, I am pleased to say that the second quarter of 2017 exceeded our expectations and was a largest producing quarter today through the Japan Post alliance.

Against that backdrop, during my time in Tokyo, I reaffirmed with Japan Post CEO Nagato-san, the importance of the strategic alliance, and was pleased to hear that he was in agreement to further strengthen our win-win cancer insurance partnership. With such an extensive distribution network that includes Japan Post, 20,000-plus postal outlets selling our cancer insurance, we will [be] furthering our goal to be where people want to buy insurance.

Aflac gets quacking

Aflac will never be the next, giving shareholders once-in-a-lifetime returns over a period of time. But that's not why investors look to Aflac in the first place.

Instead, most shareholders want a safe and growing dividend and, hopefully, a steadily climbing share price over time. On these fronts, Aflac has delivered for decades, raising its dividend for 34 straight years and basically matching the S&P 500 in capital gains over the past five years.

When Aflac finds ways to unlock additional avenues of growth, such as its strategic partnership with Japan Post, investors are rewarded with years like this one: dividend growth and market-thumping returns. For shareholders, that's never a bad combination.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.