The government must take a "strategic" approach to tackling organised insurance fraud and provide the police with clear targets, the ABI said.
Last week, the solicitor general, Mike O'Brien, promised MPs and insurers that he would review how fraud was being dealt with by police forces, with particular focus on staged motor accidents.
His promise came as the government's long-awaited fraud-busting initiative, the Fraud Act (2006), officially became part of UK law.
But while the ABI welcomed O'Brien's pledge, the trade body said the comments did not go far enough.
Chris Hannant, head of financial crime prevention at the ABI, told Insurance Times: "It is always welcome when a minister takes our concerns seriously, but obviously this is part of a wider problem.
"We need to see the government respond in a strategic way and be seen to take fraud seriously," added Hannant. "It has to appear somewhere in its key priorities, because a chief constable, like anyone, will only put their resources and efforts where they're judged to be doing their job."
Hannant said the outcome of the Fraud Review, to which the government is expected to respond in March, was key.
The ABI hopes it will find in favour of a strategic change in the way insurance fraud is investigated.