The Court of Appeal's judgment in Callery vs Gray threatens to land liability insurers with an additional bill of £600 for each motor-related personal injury claim, according to personal injury law firm Silverbeck Rymer.

The extra £600 would potentially add £2.7m to the claims costs of a liability insurer which handles around 10,000 motor-related personal injury cases each year.

In the case of Norwich Union, which handles 100,000 motor-related personal injury claims each year, the potential bill could reach £27m.

Silverbeck Rymer associate partner Juliet Herzog said: "The figures are indicative only - they may be higher in cases where personal injury costs are greater."

Herzog said liability insurers would face the increased bill because the Court of Appeal had set a success fee of 20% in personal injury motor claims and had agreed it was reasonable for successful claimants to be able to recover any premium they had paid for after the event legal cover.

She calculated that these two rulings would each add £300, or £600 in total, to an average motor-related personal injury claim of £1,800.

The £1,800 figure comprises £1,500 for solicitors' costs and £300 for medical disbursements.

Herzog added that comparable costs for the same type of claim were around £1,400 (£1,200 solicitor costs and £200 medical fees) just two years ago.

In the case of a medium-sized claims department which deals with 10,000 personal injury motor claims each year, Herzog said the potential extra cost for insurers would be £2.7m.

"This example assumes that 90% of the 10,000 claims would be minor whiplash injuries, which fall within the bracket of Callery vs Gray," she said.