Insurer Eureko's H1 profit falls on equity losses

AMSTERDAM, Aug 28 (Reuters) - Net profit at Eureko, the largest insurer in the Netherlands, fell nearly 80 percent in the first half of the year on losses and impairments on its equity investments, the company reported on Thursday.

"Eureko is not immune to the pressures caused by the current situation in the world financial markets," said Chief Executive Maarten Dijkshoorn.

Eureko is owned in part by unlisted Dutch financial group Rabobank [RABN.UL].

Net profit in the first half of 2008 was 124 million euros ($183 million), down from 561 million euros in the same period last year.

Eureko is the Netherlands' largest insurer with more than 4.7 million clients, thanks to its merger with Agis in December.

Based in Zeist, Eureko said it had no losses related to subprime investments and that its exposure was "negligible".

Still, the downturn in global stock markets earlier this year weighed on Eureko's profit, with investment losses of 34 million euros compared with a 234 million euros gain in the same period last year.

Eureko blamed part of its equity losses on its dispute with Poland over its largest insurer, PZU, in which it planned to take a majority stake after its flotation.

After the Polish government reneged on the agreement Eureko won in arbitration rulings but is still waiting to collect any compensation on damages.

That led the insurer to remain pessimistic over its full-year outlook.

"Based on current levels of the financial markets, Eureko expects more impairment losses on equity investments for the second half-year of 2008," the insurer said. "This could have a substantial effect on net profit." (Reporting by Reed Stevenson; Editing by Greg Mahlich)