UPDATE 1-Insurer AXA's 2017 profit rises ahead of planned IPO of U.S. business


* 2017 net profit 6.21 bln eur, above forecasts

* Dividend 1.26 euros/share, also above forecasts (Updates with details, CFO comment)

PARIS, Feb 22 (Reuters) - French insurer AXA posted higher-than-expected 2017 net profits and stronger earnings in the United States, ahead of the planned flotation of its American life insurance and asset management businesses in the second quarter this year.

AXA, which ranks as Europe's second-biggest insurer in terms of market capitalisation behind Germany's Allianz, repo2rted earnings per share growth at the top of its targeted range of 3 to 7 percent a year in 2016-2020.

It added it had not been hit as hard as some of its rivals by a series of costly natural catastrophes in 2017, thanks to reinsurance contracts and its diversified business model.

AXA posted a 2017 net profit of 6.21 billion euros ($7.6 billion), while analysts had on average forecast net profit of 5.97 billion euros in a Reuters poll.

The company proposed a 2017 dividend of 1.26 euros a share, up 9 percent and corresponding to a payout ratio of 49 percent. The dividend topped analysts estimates of 1.20 euros.

Faced with tighter regulations and declining investment returns, AXA is seeking out growth in areas such as property and casualty insurance for businesses, savings products that do not tie up too much capital, health insurance and operations in Asia.

"Health was our fastest growing business in 2017," AXA said in a statement, adding it had for the first time ever crossed a 6 billion euros mark in terms of overall underlying earnings.

It plans to float its American life insurance and asset management businesses in the second-quarter this year in order to free up capital and pursue takeover targets elsewhere.

"We would reinvest funds in our privileged segments, such as health and protection, commercial business lines," chief financial officer Gerald Harlin told journalists on a call.

"If we don't have any opportunities, we could eventually proceed to share buy-backs," he added.

($1 = 0.8145 euros) (Reporting by Maya Nikolaeva and Matthieu Protard Editing by Sudip Kar-Gupta)