US insurer Travelers has sued the owner of New York's Millennium Hotel, which was closed after the 11 September attacks, in a move to limit its payout for lost business.

The dispute is the latest insurance dispute following the attack on the Twin Towers.

Travelers, which provided $400m (£243m) of cover to the Millennium Hotel, asked a federal judge to declare that its policy offered business interruption coverage for one year.

However, the hotel's owner claimed that Travelers provided coverage payments for three years, plus a maximum one-year extended period.

Travelers also claims that the policy did not limit business interruption payments to one year, as Travelers says it had requested its broker, Willis, to arrange.

The judge will have to decide whether or not he should cancel the insurance policy and order the hotel's owners to repay the $39.5m (£24m) Travelers has paid out in claims.

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