SHANGHAI (Reuters) - MetLife Inc. (MET.N: Quote, Profile, Research) launched a Chinese insurance joint-venture on Friday, a move that may help the top U.S. life insurer take a slice of China's $1.8 trillion in personal savings.

United MetLife Insurance Co. is a 50-50 venture between MetLife and Shanghai Alliance Investment Ltd., the Shanghai-based venture firm said in a statement.

Shanghai Alliance, managed by Jiang Mianheng, son of former Chinese President Jiang Zemin, is an investment arm of the Shanghai city government.

The venture will focus on selling policies through agents and banks, with Shen Ruolei, a former top executive from Industrial and Commercial Bank of China (ICBC.UL: Quote, Profile, Research), China's largest bank, as chairman, said MetLife Vice President Stephan Rajotte.

"We have set up co-operative relations with some big local banks such as ICBC, which will be part of our nationwide network to sell our insurance products," said Shen.

"For the next step, we will soon include three more Chinese banks in our sales network, and using banks as our agents will be our key competitive advantage ," said Shen.

MetLife became the largest life insurance seller in the United States after purchasing Travelers Life & Annuity from Citigroup Inc. (C.N: Quote, Profile, Research) for $11.8 billion last July.

Asked if MetLife had plans to make any direct investments in a Chinese bank to boost its connection to the industry, Charles E. Symington, a senior vice president of the firm, said such a move could be an option.

China's insurance sector is expanding as Beijing dismantles a cradle-to-grave welfare system.

Foreign players such as AIG (AIG.N: Quote, Profile, Research) and HSBC Holdings Plc (0005.HK: Quote, Profile, Research) (HSBA.L: Quote, Profile, Research) are gaining wider access under commitments China made to the World Trade Organization.

Life insurance premiums in China rose 14.2 percent to 364.62 billion yuan ($45.5 billion) in 2005, according to official data.

However, less than 4 percent of China's 1.3 billion people have insurance coverage.

($1=8.01 Yuan)

______________________________________________

   
© Reuters 2006. All Rights Reserved.