Many Chinese people live underinsured or without insurance.

That means China's life insurance sector will continue to grow, Peter A Smyth, regional managing director of MetLife Asia Pacific, told chinadaily.com.cn.

Smyth said at the 19th Annual Strategic Issues Conference that even an insurance company has a very small market share, but a huge percentage of the population is still in need of coverage.

Insurance products which protect their policy holders and help people counter inflation will be highly needed, Liang Tao, head of Life Insurance Regulation Department in the China Insurance Regulatory Commission, said during the conference held from April 7 to 8 in Beijing.

The life insurance premium in China increased from about 200 billion yuan in 2000 to 1 trillion yuan in 2010, LIMBA data showed.

However, Smyth said products sold via the bancassurance channel, the main distribution channel for insurers, are mainly deposit substitutes and are used by banks to help them meet requirements for capital regulation.

"What people need is protection, so more products should be designed to protect people," Smyth told chinadaily.com.cn.

Bancassurance will continue to generate profitable growth for life insurers, Robert A. Kerzner, president and CEO of LIMRA, LOMA, and LL Global, Inc said during the conference.

Bancassurance generated 3.1 percent of premiums for life insurers in 2001. But the percentage has risen to 33.4 percent in 2010, according to LIMRA data.

However, many small life insurers will suffer, as the bancassurance channel may have been closed for them, Liang Jing told chinadaily.com.cn. Liang works with the Insurance Institute of China and used to teach insurance at Southeast University.

The China Banking Regulatory Commission banned insurance companies from positioning sales representatives in bank branches last November. Each branch of a bank can sell insurance products from no more than three insurance companies. Liang said the restrictions will benefit the bancassurance sector in the long run.