April 13 (Bloomberg) -- Aviva Plc, the U.K.'s biggest insurer, said it plans to double the number of licenses it has in China in the next five years and expand in India, as it tries to reduce its reliance on European sales.

Aviva, which makes 95 percent of its sales in Europe, plans to increase the licenses it has to operate in Chinese cities to 10, and to rank as one of the top five insurers in India from eighth now, Chief Executive Officer Richard Harvey said in an interview. Asia will make up 10 percent of sales of the company's global sales in five years, he said.

The expansion would help London-based Aviva extend its reach to the world's two fastest-growing major economies, giving it access to two-fifths of the world's population. Aviva is competing with rivals such as the U.K.'s Prudential Plc, the only foreign life insurer with licenses in seven Chinese cities.

``Aviva still has plenty of room to build up their network in the region,'' said Yoon-Chou Chong, who helps manage the equivalent of $6.6 billion, including Aviva shares, as head of pan-European equities at Aberdeen Asset Management in London. ``Prudential had an earlier and higher priority in Asia.''

Harvey said finding the right acquisition may not be easy with more insurers on the new investments.

``We are very underweight in Asia and we've really got work to do,'' Harvey said in an interview with Bloomberg television aired today. ``It's going to be a combination of growing our distribution and keeping our eyes open for one-off opportunities. Finding an acquisition that's attractively priced is far from certain.''

Expansion

Still, the economic expansion in the two markets, as well as China's entry into the World Trade Organization, may justify its investments, economists such as David Cohen said. Aviva is expanding into India and China at a time when trade between the two rose to $13.6 billion in 2004, 79 percent more than in 2003, according to China's customs bureau.

``The markets were underdeveloped to begin with, and with the rapid growth in both economies, there would be certainly opportunities particularly as traditional barriers to foreign competition are lowered,'' said Cohen, director of Asian economic forecasting at Action Economics in Singapore.

China's economy may expand by more than 8 percent this year, while India may grow by more than 6 percent, Cohen estimates.

To contact the reporter on this story: Linus Chua in Singapore at lchua@bloomberg.net.

Last Updated: April 12, 2005 20:49 EDT