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Insurers' claims costs are set to rise by hundreds of thousands of pounds following an increase in court fees.
New court guidelines have increased court fees for claimants by over 100% in some cases.
Insurers, who make up a large proportion of defendants, will have to bear these additional costs on claims that they lose.
For claims over £300,000 court fees have risen by 112.5%, from £800 to £1,700. For lower value claims, the increase is less marked. For claims between £50,000 and £100,000 fees have increased by only 16.5% to £700.
CMS Cameron McKenna assistant solicitor Kate Tregidgo said: "Court fees have risen twice in the past two years, meaning that commencing court proceedings in 2005 will be significantly more expensive than previously.
"It will take some time for this effect to be felt in insurers' pockets but the immediate impact on the insurance industry will be the need to increase defence costs reserves to take the changes into account.
She added that claimant's court costs would increase by at least £1,000 per claim over £300,000 and that these costs would have to be met by insurer defendants.
Tregidgo said the increases are likely to cost the insurance industry hundreds of thousands of pounds over time.
