China's sustainable economic growth has attracted foreign insurers to penetrate into a market which has already become a key driver of growth in global insurance premium income.

　　The latest figures available show that foreign-funded insurers collected premiums of 2.33 billion yuan (US$281 million) during the first five months, up 37.5 percent from a year earlier.

　　Their assets on China's mainland totaled 15.05 billion yuan at the end of May, up 48.8 percent from a year earlier, according to the China Insurance Regulatory Commission, the country's insurance industry watchdog.

　　Since American International Group became the first foreign insurer to set up in China's mainland in 1992, 40 overseas insurers have been allowed by the central government to sell policies in the mainland cities.

　　Many domestic companies, including China National Offshore Oil Corp, Haier Group and China National Metals & Minerals Imp & Exp Corp, have formed joint venture life insurance companies, lured by the industry's fast development in recent years.

　　China's insurers reported combined premiums of 322.8 billion yuan in the first 10 months of this year, a year-on-year rise of 70.6 billion yuan, according to the CIRC.

　　"Currently, the foreign insurance companies' share in the Chinese market is still low, but we have to be patient," said Donald J. Shepard, AEGON NV chairman.

　　He expected AEGON-CNOOC Life Insurance Co, a Shanghai-based joint venture between the Dutch-based AEGON and CNOOC, to post profits after several years of operations.

　　"Our business in China is a long- term deal," Shepard said.

　　Most new joint venture insurance companies said that they do not expect immediate returns from their initial investment in China. However, they still had full confidence in the industry's development because of the country's sustainable economic growth.

　　The 322.8 billion yuan of premiums insurers collected on China's mainland during the first 10 months had already exceeded the 305.31 billion yuan

　　recorded in all of 2002, according to the insurance watchdog.

　　According to a Swiss Re study, China has already become a key driver of growth

　　in global insurance premium income among emerging markets.

　　The life insurance business in emerging markets grew 12.7 percent in 2002, compared with a 1.9 percent rise in industrialized countries.

　　China reported a rise of around 45 percent between 2001 and 2002.

　　"Increasing income, social security reforms and the further opening up of the market are spurring the growth in insurance premiums in China," said global reinsurer Swiss Re.

　　Meanwhile, China's opening up of its insurance market to overseas investors will give foreign insurers a great opportunity to enter into the potentially huge market.

　　Last week, the watchdog opened the market to overseas insurance companies in Fuzhou, Xiamen, Ningbo, Shenyang and Wuhan.

　　So far, foreign insurers can start businesses in 18 mainland cities.