Insurers in low-growth mature markets such as Australia are looking for opportunities in emerging economies including China and India, law firm Sparke Helmore says.

The Indian Government plans to introduce reforms to increase foreign participation and help reduce under-insurance, while China has the second-largest insurance industry in the world.

“As growth within the mature insurance markets stagnates – and I would include Australia in this bucket – carriers and brokers are looking for opportunities for growth in emerging economies,” National Practice Group Commercial Insurance Leader Chris Woods says.

“And when you consider that these economies include global giants China and India, you can see how important the ‘emerging’ players are for insurers.”

Sparke Helmore is part of legal firm alliance Global Insurance Law Connect (GILC), which has produced a Spotlight on Emerging Markets report that also highlights Brazil and Mexico.

The report says emerging markets are rapidly growing but may carry higher risks that need to be understood by companies looking to explore their options.

“The opportunities are endless for insurers willing to go on something of a wild ride,” Commercial Insurance Partner Gillian Davidson says.

IAG won’t be going on that ride, after announcing earlier this month that it will sell its 26% stake in the SBI General joint venture in India. It was the latest exit by the company in a wider pull-back from Asia as it sharpens its focus on Australia and New Zealand.

Business commentator John Durie, writing in The Australian, called the decision “arguably the dumbest” that IAG CEO Peter Harmer has made in his career and one that is akin to “walking away from a potential goldmine”.

India has gross written premium of $US100 billion ($146 billion) and a growth rate of 10.1%, according to the GILC emerging markets report.

QBE has a joint venture in India with a company that is part of the Rajan Raheja Group.