A row has broken out between Lloyd's broker Sterling Hamilton Wright and Zenith over about £2m in lost commission.

Until the end of January this year, Zenith paid Sterling Hamilton Wright a1.5% commission on all the premiums the broker guaranteed from Lloyd's.

But Zenith said it would stop using guaranteeing brokers on 1 February 2003.

In a statement, Zenith said: "Every effort was made to keep the guaranteeing brokers fully informed of developments since November 2002."

Sterling Hamilton Wright disputes this. A spokesman said: "Zenith terminated a 35-year relationship with seven days' notice." The spokesman confirmed Sterling Hamilton Wright was now in correspondence with Zenith, but denied legal action was imminent.

It is not known how much income Sterling Hamilton Wright has lost, but sources have put the figure at £2m.

Zenith said: "Zenith desires to retain a good relationship with guaranteeing brokers in the future, albeit on a different basis."