It comes six months after a consultation paper setting out how to implement the reforms – initiated by then chancellor George Osborne – was finalised.
Delays to whiplash reform cost motorists nearly £3m a day, according to the Association of British Insurers (ABI).
James Dalton, director of general insurance policy at the ABI, said: “The Ministry of Justice seems to be rowing back from much needed reform to the civil justice system that will save motorists up to £50 a year on average. The UK has one of the most abused systems in Europe and the reforms would tackle the excesses of the compensation culture.
“Without action, claims management companies will continue to nuisance call and text honest motorists encouraging them to make fraudulent and exaggerated claims through claimant law firms.”
Under the government’s plans, injured people would still be compensated for their losses, such as the cost of medical treatment and loss of earnings, but “general damages” – cash payments on top of these losses, for pain and suffering – would be limited for minor injuries.
The reforms also propose raising the personal injury threshold for claims in the small claims court to £5,000 from the current £1,000.
The ABI said motor premiums are up 10% over the last year with the rising cost of personal injury claims and large increases in Insurance Premium Tax (IPT) fuelling the price rise.