Claimants can be better off if they shun legal representation, according to research published by the ABI.
Research carried out of over 90,000 personal injury claims of between £1,000 and £25,000 showed that claimants without legal representation receive on average £289 more than claimants with legal representation.
In addition, the research found that the time taken to settle claims without legal representation is on average 95 days shorter.
The study, carried out by Frontier Economics, looked at motor, employers' liability and public liability claims.
While motor and employers' liability claimants were better off through not using lawyers, those with public liability claims were slightly better off if they had legal representation.
Phil Bell, technical liability manager for Royal & SunAlliance, said: "This was a sizeable study and, in smaller, straightforward cases it is difficult to see what advantages lawyers bring.
"I would like to see the UK study the newly introduced Irish model in greater detail as this has helped speed up settlements.
"We need to explain to claimants that the ABI's Care and Compensation proposals are not about taking money off them - they are about allowing us to get on with paying claims."
A spokeswoman for RBS Insurance said the company would be carefully studying the ABI's research on the benefits of legal represent-ation.
Kate Lotts, director of claimant services at RBS Insurance, added: "Genuine claimants are losing out in a system that's slow and costly. Our belief is that the take-up of rehabilitation should be maximised."
The Association of Personal Injury Lawyers (Apil) said: "This is interesting research from the ABI but there is obviously a great deal of detail to be absorbed.
"We look forward to studying the findings in full and analysing the detail, before commenting further."