MILAN, Aug 2 (Reuters) - Italy's top insurer Assicurazioni Generali said on Tuesday it would increase prices to keep up with rising costs, and maintained its financial targets after a strong life business helped it beat first-half earnings expectations.

Generali, which on Wednesday will kick off its first share buyback in 15 years, reported a first half net profit of 1.4 billion euros ($1.4 billion), above a company-gathered analyst consensus of 1.33 billion euros.

Net profit fell 9% year-on-year after a 138-million-euro impairment on the company's exposure to Russia.

"Generali's life business is the standout performer year-to-date ... driving a material beat to earnings expectations," Jefferies analysts said.

Generali confirmed all targets under its 2022-2024 strategic plan, including an average compound earnings per share growth of 6%-8%.

The insurer has been buffeted over the past year by a boardroom battle that saw two of its top three investors challenge the reappointment of CEO Philippe Donnet.

"Results showed that implementing our strategic plan is the right way to achieve sustainable growth and to increase our operating profitability" despite growing macroeconomic and geopolitical uncertainties, Donnet told a press briefing.

Closely watched net operating profit rose 4.8% from a year earlier to 3.14 billion euros, above a 2.96 billion euro consensus forecast.

Shares in the insurer fell 1.4% by 0745 GMT slightly underperforming a negative European insurance sector, with traders saying the stock had outperformed over the past three days.

To counter the impact of rising inflation on claim costs, Generali will "significantly" increase prices in the non-life business, Donnet said.

Generali, a major holder of Italian government bonds, cut its domestic sovereign portfolio to 53 billion euros in June from 63 billion euros in December, head of Finance Cristiano Borean said.

The move reduces Generali's exposure to rising premiums on Italian bonds, which have been suffering due to macroeconomic concerns as interest rates rose and Russia cut gas exports, and are now further in the markets' cross-hairs ahead of a snap election in Italy next month.

Borean also said Generali had sold more life insurance products which tie up less capital.

The solvency ratio, a measure of an insurer's financial strength, stood at 223% as of July 29, down from 233% at the end of June due to the market turmoil and the acquisition of French health insurer La Medicale.

As set out in its strategic plan, Generali will spend 500 million euros to repurchase up to 3% of its share capital by the end of this year.

($1 = 0.9736 euros) (Additional reporting by Giancarlo Navach, editing by Valentina Za and Susan Fenton)