UPDATE 2-London stocks slide as recession worries grow

* U.S. central bank chief warns of prolonged economic slump

* Housebuilders slide as surveys suggest fall in prices

* Lloyd's of London estimates COVID-19 bill at up to $4.3 bln

* Investment management firm 3i rises after keeping dividend

* FTSE 100 down 2.8%, FTSE 250 slip 3% (Adds comments, updates to close)

By Shreyashi Sanyal and Sagarika Jaisinghani

May 14 (Reuters) - UK stocks closed firmly in the red on Thursday as investors worried that a recovery from a coronavirus-led economic slump would be slower than expected even as several hard-hit countries started easing lockdowns.

The blue-chip FTSE 100 .FTSE was down 2.8%, with battered energy .FTNMX0530 and travel and leisure .FTNMX5750 stocks down nearly 4%. The mid-cap FTSE 250 .FTMC shed 3%.

Insurance stocks .FTNMX8530 fell 3.7% after Lloyd's of London said it was likely to pay up to $4.3 billion in claims related to the COVID-19 pandemic, while underwriting and investment losses for the global non-life insurance sector could reach a record $203 billion. two main UK stock indexes have now given up all the gains made this month as hopes of a speedy revival in business activity were dashed after U.S. Federal Reserve Chair Jerome Powell warned of an "extended period" of weak economic growth. as some easing of lockdown restrictions and a raft of stimulus measures helped global equities rebound in the recent few weeks, investors remained cautious of a second wave of new coronavirus infections.

"If a second surge were to take place, overwhelming health infrastructure, governments may find themselves with little choice but to reintroduce lockdowns," said Seema Shah, chief strategist at Principal Global Investors.

"In that worst-case scenario, even the most monstrous policy stimulus could not support continued equity market gains."

On Wednesday, the UK posted its sharpest ever GDP contraction in March, with economists warning the slump could be worse in April. For the year, the Bank of England has predicted the worst recession in three centuries. out of the United States continued to show more distress in its labour market as Americans filing for unemployment benefits rose to 2.981 million for the week ended May 9. the UK starting to ease some restrictions, housebuilder Persimmon PSN.L said it had restarted 65% of its construction work and was reopening sales offices on May 15. its shares fell 4.7% along with the wider housebuilding index .FTNMX3720 as surveys suggested British house prices would only recover to their pre-lockdown levels in 11 months' time. Smith SMWH.L reported an 85% slump in group sales in April, although a 400% rise in online book sales helped offset some of the damage from the closures of its kiosks and stores, sending its shares slightly higher in morning trading. management firm 3i Group Plc III.L rose 6.3% to the top of the FTSE 100 after sticking to its plan to pay a 2020 dividend at a time when a slate of UK companies have cancelled payouts to shore up liquidity.