UPDATE 1-Harleysville sees Q3 charge from Lehman exposure

(Recasts, adds details)

Sept 23 (Reuters) - Property and casualty insurer Harleysville Group Inc (HGIC.O) said it will incur a charge in the third quarter tied to its exposure to Lehman Brothers Holdings Inc's (LEHMQ.PK) senior unsecured notes.

Harleysville expects to incur "other-than-temporary" non-cash investment charges during the third quarter as it holds $6.0 million of Lehman Brothers' senior unsecured notes at par value, it said in a statement.

The company also holds $5.0 million, at par value, of American International Group (AIG.N) senior unsecured notes. It does not own any common or preferred equity of Fannie Mae (FNM.N) or Freddie Mac (FRE.N).

Harleysville also said it expects no significant impact on third-quarter results related to hurricanes Gustav and Ike, even though it has experienced claims activity in the non-coastal states in which it writes business.

Shares of Harleysville closed at $38.52 Tuesday on Nasdaq. (Reporting by Ratul Ray Chaudhuri in Bangalore; Editing by Gopakumar Warrier)