BEIJING (Bloomberg) ? China?s insurance market may grow annually at 15 percent as economic expansion boosts income and prompts more sales, Zhou Yanli, vice chairman of China Insurance Regulatory Commission, said on Saturday.

And foreign insurers and reinsurers, including Bermuda-based XL Capital, expect growth in areas like catastrophe and casualty insurance. XL opened an office in China on January 30 and yesterday announced plans to finance insurance leadership courses in China.

Total assets held by insurers may double from last year to 3 trillion yuan ($373 billion) by 2010, and premiums may rise to 1 trillion yuan, Zhou told reporters in Beijing.

China?s insurance industry expanded at an average annual pace of 25 percent between 2000 and 2005, helped by increasing household savings, economic development and government cutbacks in welfare benefits.

The insurance market reached 493 billion yuan last year, surpassing growth in the US and Europe.

?We will see more moderate and stable growth,? Zhou said. ?We want to see more structure and quality products to drive growth in the industry.?

Total assets held by insurers rose to 1.52 trillion yuan as of December 31, with bond holdings totaling 739 billion yuan and equities 110 billion yuan, the commission said in January. Insurers had premiums of 370 billion yuan selling life policies in 2005. Property and casualty insurance products generated premiums of 123 billion yuan.

China?s insurance penetration, or premiums as a percentage of gross domestic product, was 3.3 percent compared with 9.4 percent in the US and 7.9 percent in Europe in 2004, according to latest figures from Swiss Reinsurance Co.

China?s insurance market may introduce products this year that could help boost rural productivity, such as livestock and crop insurance, and expand rural healthcare, Zhou said.

?Farmers have been too dependent on the weather for their livelihood. We need products that can provide assurance for stable agricultural output,? Zhou said.

Casualty insurance, catastrophe reinsurance and construction are also areas foreign insurers such as XL Capital Ltd. identified as having growth potential in China.

?Insurance penetration is relatively limited at this point,? Henry Keeling, XL Capital?s chief executive of reinsurance life operations, said in Beijing today. ?As people?s personal assets and corporate assets grow, people will recognise the need to protect those assets.?