TORONTO, Aug 13 (Reuters) - Sun Life Financial Inc ( SLF )

CEO Kevin Strain said on Tuesday the company's U.S.

dental insurance business was improving after losing money in

the latest quarter, and was on track to hit its goal for $100

million in earnings in that segment in 2025.

The Canadian insurer's shares were up about 5% in mid-day

trading in Toronto after its second quarter earnings topped

expectations.

The dental segment posted a loss for the second quarter hit

by Medicaid redeterminations that pressure Medicaid and Medicare

Advantage sales leading to a 5% fall in the US segment's core

earnings.

As more Medicaid contracts are repriced along with broader

expense reductions, the segment is expected to see improvements.

About 90% of Medicaid contracts are expected to be repriced

this year, the company said.

"We still think that the U.S. is a good long term growth

market for us in both the group benefit side (and) in the asset

management side under both MFS and SLC," Strain said in an

interview.

Sun Life acquired dental benefits provider DentaQuest as

part of its strategy to grow its presence in the U.S., which now

accounts for roughly a fifth of its overall undelying income.

"We would look at expanding growth there (U.S.), as well as

in Asia," he said, adding that US is a growing segment with

potential in both insurance and asset management.

Jefferies analyst John Aiken noted that while the U.S.

dental business faced challenges, it provides "upside potential

that should be easily recognized with the management actions

taken to date."

Sun Life's Tuesday gains took its year-to-date performance

to positive territory. Rival Manulife's shares have

gained 18.8% so far this year.

(Reporting by Nivedita Balu in Toronto)