Costs cases are going to clog up the courts, with no improvement likely until the government steps in, the Forum of Insurance Lawyers (Foil) has warned.
Foil president Tim Wallis said the recent House of Lords judgment on Callery v Gray did nothing to resolve the issues around costs, which have festered since the government replaced legal aid in personal injury cases with an "ill-thought-out funding scheme".
He said they would now be contested in the courts.
"Moreover, with so many references by the House of Lords to see the potential for abuse under the new funding regime, it's hardly likely that liability insurers will choose now as the time to beat a retreat," he said.
"I fear the situation will get worse before we see the necessary level of political will to resolve these problems."