The life insurance market in China is expected to become the second largest market in the world after the US, by 2020, according to a report from UK based research firm BRICdata.

The report lists the ageing population; robust economic growth; the rising disposable incomes of China’s middle class; and the increasing awareness of the need for insurance, especially among the young people, as the contributors to the significant growth of China’s life insurance market during 2006-2010 period.

However, China remains an untapped market with only 50% of the population having some form of life insurance in 2010, despite the country’s insurance industry growth.

The report suggests that life insurance market in China will provide major opportunities during the 2011-2015 period, as the market represented only 2.6% of the country’s gross domestic product (GDP) in 2010.

Major part (94.3%) of the total Chinese life insurance industry was accounted by the individual life insurance segment in 2010, the report said.

The report found that significant market share was achieved by distribution channels such as bancassurance in the review period from 2006 to 2010.

Currently, Japan is the largest insurance market in Asia Pacific, followed by China, which is the world’s sixth largest life insurance market, according to the report.

The full report ‘Life Insurance in China, Key Trends and Opportunities till 2015 ‘ is available from BRICdata. Click here for more details.