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India and China, among the world's fastest growing economies, represent big opportunities for the insurance industry.

But a new report finds that penetrating those markets is not easy as billions of consumers are not familiar with the role that insurance plays

According to the report, in India:

* Insurance reforms have paved the way for private participation, fostering strong growth.

* Life insurance is largely used as a means to improve finances, while nonlife coverage is not considered a necessity.

* Since the ranks of the middle class are growing, and per capital income is rising, the insurance market could double in size in the next five to six years.

* Insurance companies are adopting a strategy of deploying multiple distribution networks to increase market penetration.

* Customers fit into three segments: upmarket or modern; traditional; rural and uneducated/semieducated.

According to the report, in China:

* A restructured and fast-growing insurance sector is still consolidated among a handful of large companies.

* Insurers still have much to do to gain customer awareness and trust; spending on insurance is "minute," and few customers are aware of, or see merit in, insurance products.

* Physical distribution networks still dominate, and it may be efficient for foreign insurers to opt for a bancassurance model to leverage local bank branches, sales representatives and call centers.

* Large insurers are likely to pursue an integrated financial services strategy to leverage scale and capabilities. Size will also be critical to improving brand recognition, expanding the breadth of service, and enhancing network strategy.