UPDATE-2-Munich Re Q3 premiums up, net misses expectations

* Q3 net 644 mln eur after minorities vs 700 mln poll avg

* Q3 operating profit more than triples to 1.21 bln

* Q3 gross written premiums 10.355 bln, up 11.7 pct

* Share down 2.1 pct, lags index

(Adds detail, analyst comment, background)

FRANKFURT, Nov 5 (Reuters) - Munich Re (MUVGn.DE), the world's largest reinsurer, swung to a net profit in the third quarter from a small year-earlier loss, helped by low natural catastrophe claims and stronger investments.

Still, the quarterly net profit of 644 million euros ($950 million) was below the average expectation for 700 million euros in a Reuters poll, despite a nearly 12 percent rise in booked premiums in the period. [ID:nL2210718]

The company was optimistic about the remainder of the year.

"Munich Re expects a group profit of between 2.2 billion and 2.5 billion euros for 2009 -- at least 700 million more than in 2008," it said in a statement.

Operating profit at Munich Re's reinsurance segment rose nearly seven-fold in the third quarter on a 20 percent rise in premiums, while its ERGO insurance unit saw operating profit fall by nearly 6 percent on a slight premium rise.

"Natural catastrophes were negligible," said DZ Bank analyst Thorsten Wenzel, adding that quarterly net profit had come in below expectations but that this was mainly due to an unexpectedly high tax burden.

Munich Re rival Swiss Re RUKN.VX this week beat forecasts with its third-quarter earnings, which analysts said reflected disciplined underwriting as well as the lack of storms. [ID:nL293581]

Data from StarMine, which weights analysts' forecasts according to their track record, shows Munich Re trading at 7.8 times 12-month forward earnings, a discount to Swiss Re's multiple of 9.4.

Munich Re's shares fell 2.2 percent to 105.10 euros by 0810 GMT, lagging a 1.7 percent drop in the DJ Stoxx European insurance index. The lack of big hurricane damage claims that have crushed profits in recent years along with a continuing recovery in financial markets has reinsurers on course for bumper earnings this year.

Munich Re said its third-quarter results left it in a strong position to exploit market opportunities as well as continuing with its plans to buy back up to 1 billion euros of its own stock by April 2010. It bought 176 million euros' worth by end-October.

But the strong recovery of reinsurers is already prompting their insurance company customers to clamour for price cuts for reinsurance products to cover risks such as storms and earthquakes, which industry observers fear could dent reinsurance profits again next year.

Munich Re's shares are down about 4 percent so far this year, lagging an 8 percent rise in the DJ Stoxx European insurance index .SXIP and a 40 percent rise in shares of rival Hannover Re (HNRGn.DE), due to report third-quarter results on Friday.

Swiss Re's shares have fallen 7 percent since the start of the year. ($1=.6782 Euro) (Reporting by Jonathan Gould; editing by Sarah Edmonds and Jon Loades-Carter)