UPDATE 1-Generali mulls agreement over Czech insurer-sources

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MILAN, April 24 (Reuters) - Italy's Generali will discuss a possible agreement with Ceska Pojistovna, the largest Czech insurer, at an extraordinary board meeting on Thursday, sources familiar with the issue said.

"The board will discuss the issue," one of the sources told Reuters on Tuesday without disclosing details of the possible agreement.

Pojistovna, which controlled at the end of 2006 a third of the Czech insurance market, is fully owned by investment group PPF, held by financier Petr Kellner, the country's richest man.

Both Generali, Italy's leading insurer with a market capitalisation of about 42.6 billion euros ($57.78 billion), and PPF declined to comment.

Italian newspaper Corriere della Sera reported on Tuesday that Generali, already a big player in central and eastern Europe, was considering a joint venture with unlisted Ceska Pojistovna.

The former communist-era insurance monopoly has seen its market share erode over the past year as competition grows and its premiums dropped to 39.7 billion crowns ($1.92 billion) in 2006, due to a fall in the life business.

Generali shares were down 0.24 percent at 33.32 euros by 1144 GMT, broadly in line with the market.