Asia’s immature insurance markets are ripe for major growth but could be constrained by protectionism, according to a survey by legal firm Norton Rose.

The survey of 92 professionals across life, non-life, reinsurance, advisory and regulatory agencies in the region rated the top five areas for significant growth as China, India, Indonesia, Vietnam and Malaysia.

Respondents expect that because of tough foreign investment rules, these markets will grow through joint ventures, while Australia, Hong Kong, Japan, Singapore and Taiwan will see mergers and acquisitions.

The report picks up tensions between opportunities for growth and protectionist restraints as well as between a desire for light regulation to facilitate growth against tighter control in line with European rules.

Norton Rose’s Head of Financial Institutions James Bateson says political and regulatory uncertainty, together with protectionist regimes, are a barrier to growth “but the pure scale of opportunity means that new entrants and existing players wishing to expand have to take strategic risks with those factors”.

The United Nations estimates the region’s total population of 3 billion will grow to 4.5 billion by 2020.

The report identifies two hurdles to investment: increasing difficulty in identifying opportunities to grow and the joint venture model, which it says “is one of the most difficult business structures to make work successfully”.

It warns while there may be almost unlimited growth potential, actual implementation and successful operation to take advantage of it is a big challenge.

Nearly half the respondents (42%) believe that the EU’s Solvency II measures will have a significant impact on the region.