The ABI is set to call for an independent arbitration system to replace the court cases that decide most personal injury claims.
The move is set to slash the £2bn a year that insurers pay in legal fees and other costs. This in turn is widely expected to bring down the cost of claims in general.
The proposed new system will be similar to the Personal Injuries Assessment Board set up in Ireland last year in which certain benchmarks are in place for each category of injury.
Justin Jacobs, ABI head of liability, motor and risk pricing said: "The current system is too adversarial and complex."