NEW YORK (Bloomberg) — Foreign insurers are less optimistic than a year ago about penetrating the Chinese market due to tighter regulations and as local rivals prove more resilient to an economic slowdown, a PricewaterhouseCoopers LLP survey showed.

Companies including American International Assurance Co. expect their share to grow to just eight percent of China's life insurance market in three years, according to the report released yesterday. Property insurance is projected to grow two percent.

The estimates compare with a 10 percent share of the overall insurance market they forecast for 2011 in a similar survey by the accounting firm a year ago.

Premium growth in China slowed to 6.6 percent in the first seven months of this year from a 53 percent surge a year earlier, as the government curbed bank-counter sales of short-term products to help insurers improve profitability, and slower economic growth sapped demand.

Foreign insurers' market share dropped to 3.8 percent in the period from 3.9 percent last year.

"2008 has been a difficult year for foreign insurers in China, not only because of the general slowing of the Chinese economy, but also because the large domestics have proved more resilient to the slowdown versus their foreign competitors," Peter Whalley, PwC head of insurance industry in Hong Kong, said in an e-mailed statement.

China Life Insurance Co., the nation's biggest insurer, reported an 11 percent rise in net premiums in the first half, which helped lift profit by 15 percent as a stock-market rally boosted investment returns.

Tighter regulatory oversight, including stricter solvency requirements, is among reasons for lowered expectations, according to yesterday's report.