SYDNEY (Bloomberg) — Lloyd’s of London, the world’s biggest insurance market, will open an office in Shanghai next month, entering Asia’s fastest-growing major economy.Lloyd’s will start selling reinsurance in China from April 16, Chairman Peter Levene told reporters in Sydney.

“The enormous growth in that market makes it an attractive prospect for the future,” he said. “Being able to offer reinsurance to local insurers will be a significant business.”

Insurers including Prudential Plc and American International Group Inc. are expanding in China as rising incomes, economic growth and government cutbacks encourage more of the nation’s 1.3 billion people to buy insurance products. China’s insurance market grew 14 percent last year, according to the China Insurance Regulatory Commission.

Lloyd’s has raised the amount of premiums it can accept in 2007 by 9 percent to a record $31 billion as prices for some types of insurance declined. The market, which insures property such as oil rigs, ships and aircraft, will next month report a profit for 2006 after posting a loss a year earlier, when it paid out $6 billion of claims for damage caused by the worst US hurricane season on record, Levene said.

“We will have had a very good year in 2006,” he said, citing a lack of hurricane activity on the US Gulf Coast.

The three biggest insurers trading in the Lloyd’s market are Bermuda-based Catlin Group Ltd., Australia’s QBE Insurance Group Ltd. and Amlin Plc, which said this week 2006 profit rose 91 percent to $268 million after it paid fewer claims.

Lloyd’s is also seeking to open an office in India, where there are restrictions on overseas ownership, Levene said.

“They have told us they are going to change the law,” he said. “We’d like to operate there and will do so as soon as we can.” Lloyd’s traces its roots to a London coffee shop opened by Edward Lloyd in 1688.

China’s economic growth averaged 10 percent over the past four years. India’s has averaged 8.6 percent in the same period.