The head of claims at car insurance giant Admiral has claimed that solicitors’ fees are to blame for the continuing row over referral fees.

The comments were made as claimant lawyers reacted with fury this week to new figures published by the Association of British Insurers, suggesting that claimants receive more compensation when they do not use a lawyer. Leading retailers, including Argos and Asda, have joined the ABI’s campaign for an overhaul of the costs process.

Admiral’s head of claims Stuart Morgan defended his firm’s stance on receiving referral fees, and described it as the ‘symptom rather than the cause’ of the controversy.

Last month, the Admiral group, which owns Diamond, elephant.co.uk and confused.com, posted half-year turnover of more than £1bn, including a multi-million-pound income from referral fees.

He said: ‘Admiral does receive referral fees but we don’t sell customers’ data. We have customers who have road accidents who say they’ve been injured and we put them in touch with a lawyer who will pay us a referral fee.

‘Most insurance companies do that and if we didn’t somebody else would. The fact that the lawyers can pay this means there’s an awful lot of money to be made by them.’

Morgan insisted the case for reform of civil litigation costs was as strong as ever, arguing that the industry as a whole is still making a loss from car insurance.

Meanwhile, the ABI suggested this week that the number of personal injury claims received by insurers had leapt by 72% between 2002 and 2010.

It argued that its research has shown that people can get more compensation, typically an extra £289, more quickly if they deal with an insurer rather than a lawyer.

The Law Society slammed the report as ‘self-serving and offensive to victims’, while the Access to Justice Action Group, which objects to costs reforms currently being pushed through by the government, said insurers ‘only have themselves to blame’ for rising legal fees.

The ABI has attracted support for costs campaign reform from leading retailers and manufacturers, including Argos, Asda, Ford and Whitbread. The companies, which collectively employ more than 260,000 people, have formed a ‘consortium for compensation reform’ with other interested parties.

Otto Thoresen, the ABI’s director general, said: ‘Other countries have taken action and we must do the same. Excessive legal costs must be reduced.’

But AJAG co-ordinator Andrew Dismore rebutted the ABI’s argument that a claimant does not need a lawyer as offers are fair and should be accepted, cutting costs.

Quoting figures from the Personal Injury Bar Association based on 1,349 cases, he added: ‘Some 33% of claims need court proceedings to get a satisfactory offer. In 47% of cases, the insurers’ offer was inadequate; and 2% needed a full court judgment to get a fair sum.’