* Deal expected to give Swiss Re a $100 mln first-quarter gain
* Berkshire payments may not cover future losses
* Berkshire's exposure to potential claims reduced by $450 mln
ZURICH, March 28 (Reuters) - Swiss Re has settled a dispute with Berkshire Hathaway over a 2010 life reinsurance deal and will receive a $610 million payment from U.S. tycoon Warren Buffett's company, the Swiss reinsurer said on Thursday.
Under the original January 2010 deal, Swiss Re agreed to transfer a U.S. life reinsurance contract to Berkshire for 1.3 billion Swiss francs ($1.36 billion), allowing it to reinvest capital more profitably elsewhere.
That allowed Buffett's Berkshire to pocket premiums payable under the contract, while taking responsibility for paying up to $1.5 billion in potential claims.
Swiss Re said in a statement that Berkshire's exposure to potential claims will be reduced to $1.05 billion from $1.5 billion and that the deal is expected to provide Swiss Re with an initial first-quarter gain of $100 million.
The company said the effect of the agreement beyond the first quarter would depend on the performance of the business taken back from Berkshire as well as the business still covered under the original deal.
"There is no assurance that the payments received from Berkshire Hathaway will be sufficient to cover future losses," the Swiss group said in a statement.
Swiss Re said that, including the payments agreed in the settlement, it had recovered a total of $815 million from Berkshire to date.
In 2009 Buffett's Berkshire shored up the weakened Swiss Re with a 3 billion Swiss franc investment after the Swiss group wrote down twice that amount in toxic assets.
The group repaid the loan in 2011.
Earlier this year Swiss Re said the expiry of a quota share agreement with Berkshire is expected to bring a significant rise in premium income in 2013.