The company raised its quarterly dividend on its class A ordinary shares to 15.75 cents from 15 cents per share. The increased dividend is payable on May 15.
The increase in quarterly cash payment marks the first change since the company cut its dividend from 22.5 cents in 2002.
Aon said the new buyback program will replace the $2 billion program authorized in January 2010.
On a post-earnings conference call in February, Chief Executive Greg Case had said the company was on track to deliver improved growth in 2012 despite challenging macro economic conditions.
Shares of the company were trading marginally higher at $49.95 before the bell. They closed at $48.85 on Wednesday on the New York Stock Exchange.
(Reporting by Aman Shah in Bangalore; Editing by Gopakumar Warrier, Roshni Menon)