The Association of British Insurers (ABI) has called on the Ministry of Justice to push through whiplash compensation reforms, to stop lawyers rorting the system.

The reforms would save an estimated £1 billion ($1.6 billion) a year on premiums, meaning delays are costing motorists nearly £3 million ($4.8 million) a day, the ABI says.

Under the reforms victims will still be compensated for losses such as the cost of medical treatment and missed earnings, but “general damages” – cash payments on top of these losses for pain and suffering – would be limited.

The reforms also discourage claims farming by solicitors, by increasing the small claims court limit – under which claimant lawyer fees are not recoverable – from £1000 ($1601.34) to £5000 ($8006.55).

A consultation paper on implementing the reforms remains unpublished, despite being finalised six months ago.

ABI Director of General Insurance Policy James Dalton says the Ministry of Justice seems to be “rowing back” on the reforms.

“The UK has one of the most abused systems in Europe and the reforms would tackle the excesses of the compensation culture,” he said. “Without action, claims management companies will continue to nuisance-call and text honest motorists, encouraging them to make fraudulent and exaggerated claims through claimant law firms.”