FTSE closes higher after post-Brexit slump, insurers rally

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* FTSE ends 2.6 pct higher after recent slump

* Financials lead the market higher, Prudential (HKSE: 2378.HK - news) up 7.7 pct

* Legal & General (LSE: LGEN.L - news) says balance sheet strong post EU vote

By Atul Prakash and Alistair Smout

LONDON, June 28 (Reuters) - Britain's top share index bounced back on Tuesday following two straight sessions of steep losses as insurers and banks, hit hard in the aftermath of Britain's decision to leave the European Union, led the market higher.

The FTSE 100 index closed 2.6 percent higher at 6,140.39 points, with all but nine stocks trading in positive territory.

It (Other OTC: ITGL - news) had fallen more than 5 percent in the last two sessions after the Brexit vote, wiping nearly 100 billion pounds ($130 billion) off the value of blue-chip firms. Britain suffered further blows on Monday as ratings agencies cut their sovereign credit score.

The UK Life Insurance index, which plunged more than 20 percent in the past two sessions, surged 6.4 percent and recorded its biggest one-day percentage gain since late 2011, led higher by a 7.7 percent jump in Prudential.

Shares (Berlin: DI6.BE - news) in Legal & General rose 7.9 percent, after it said its balance sheet had proved resilient to the Brexit vote and it had trimmed its exposure to riskier assets beforehand. Aviva (Other OTC: AIVAF - news) , Standard Life (LSE: SL.L - news) and Old Mutual (Other OTC: ODMTY - news) rose 3.4 to 5.7 percent.

"Equities look to have found their footing post-Brexit despite political turmoil in Westminster," Mike van Dulken, head of research at Accendo Markets, said.

"Bargain-hunting may be helping as opposed to emergence of genuine support as markets adjust to a new normal and the prospect of the UK outside the European Union."

The banking index rallied 2.9 percent after slumping 16.4 percent in two days, with some investors taking advantage of weaker share prices. Travel and leisure stocks rose 1.6 percent after a 12 percent slump.

The mid-cap FTSE 250 rose 3.6 percent after the domestically-focused index's 13.7 percent slump since Thursday. Shares in Ocado were up 8.6 percent after the food retailer reported a profit rise.

"Online supermarket Ocado continues to prosper with the group gaining market share on the seemingly inexorable rise of the armchair shopper," AJ Bell's Investment Director, Russ Mould, said.

"Ocado is benefiting from its tie-up with Morrisons and pre-tax profits are increasing, albeit at a slower rate, despite price deflation," he said.

Shares in British challenger bank Shawbrook fell more than 14 percent, however, after it said it expected to book an additional impairment charge due to some irregularities in its asset finance business and that CFO Tom Wood had resigned. (Additional reporting by Atul Prakash; Editing by Ruth Pitchford and Raissa Kasolowsky)