BEIJING (AP) — Survivors trying to rebuild their lives from China's devastating earthquake are missing a critical aid — insurance.

Few among the 28 million people living in the quake-struck area in Sichuan province have life or property insurance. That will slow rebuilding efforts and force many to depend on government assistance.

In the town of Dujiangyan, fabric salesman Wang Yong lost his store, apartment and delivery van.

"Our home has been condemned and we don't have any money to buy a new one," said Wang, who had no insurance. Wang now lives in a hot, prefabricated house with his wife and their teenage son.

Estimates of the devastation are still being compiled, but AIR Worldwide, a catastrophe risk modelling firm, puts the damage at more than $20 billion. It estimates that just five percent of the losses were covered by insurance.

The Chinese government has already announced a 70 billion yuan ($10 billion) fund for reconstruction. The government also has told state banks to forgive debts owed by survivors of the quake who lack insurance.

The expense has prompted the government to think about the next quake, dusting off plans for a state-subsidised earthquake insurance pool.

The damage caused by the May 12 earthquake "reveals the importance and urgency of establishing an earthquake insurance system", the China Insurance Regulatory Commission said in a statement. "A mechanism to spread risk that suits China needs to be quickly established."

The insurance industry here is in its infancy.

Despite the rising number of Chinese who can afford homes — and a construction boom spurred by rapid economic growth — awareness about insurance is still low, especially outside the major cities of Beijing and Shanghai.

Owning private property was only given full legal protection in 2004, and many grew up under a system where cradle-to-grave employment and related benefits were provided by the government.

Companies and individuals can buy earthquake insurance in China as an add-on to property and home insurance, but analysts say consumers are sceptical it is priced properly or will pay out as promised.

People also are used to the government providing reconstruction money after natural disasters, whether earthquakes or floods.

"Buying insurance in China ... is low, but earthquake insurance is even lower than that," said Domenico del Re, senior model manager at the London office of Risk Management Solutions, which researches catastrophe risk and has advised the Chinese government on earthquake insurance. He added: "I suspect that this earthquake will actually bring to the surface a lot of lessons. ... This is the first earthquake that has impacted modern China."

Insurance companies have received just over 200,000 claims related to the earthquake, 27,500 of them for homes — representing just a fraction of the damage.

Analysts said any state-subsidised quake insurance programme would likely involve international reinsurance firms who have the global reach to support such a scheme. Reinsurance is insurance purchased by insurance companies to spread risk. China suffers about 200 billion yuan ($29 billion) in losses each year from disasters such as earthquakes, floods, and typhoons, official Xinhua News Agency quoted the director of the China Meteorological Bureau saying last August. Twenty-three of its 31 provinces are prone to earthquake risks, according to the insurance regulator.