Insurers must "get their house in order" and end practices which encourage fraud and exaggeration in vehicle whiplash injury claims, a report by MPs said today.
Ministers should consider reducing the limitation period for road accident insurance claims, and require whiplash claimants to produce more supporting evidence, said the report from the House of Commons Transport Committee.
But genuine claimants should not be demonised and the assertion that the UK is the "whiplash capital of the world" cannot be proved or disproved, the MPs said.
The report also warned that access to justice could be impaired by Government proposals to switch whiplash claims between £1,000 and £5,000 to the small claims court, particularly for people who do not feel confident to represent themselves against insurers who will use legal professionals to contest claims.
The use of the small claims track could also prove counterproductive in efforts to discourage fraudulent and exaggerated claims as expert evidence is not generally submitted.
In their report the MPs said: "We were surprised to hear that insurers will sometimes make an offer to personal injury claimants even before a medical report has been received. We also note that our previous recommendation on making the links between insurers and other parties involved with claims more transparent has been ignored.
"Insurers must immediately get their house in order and end practices which encourage fraud and exaggeration. If not, the Government should take steps to protect motorists."
Launching the report today, the committee's chairman Louise Ellman said: "Whiplash injuries can have debilitating consequences for those who suffer them. However, some of the increase in whiplash claims will have been due to fraud or exaggeration."
"To help bring insurance premiums down the Government must tighten up the requirements for motor insurance claims and ensure that insurers honour their commitment to reduce premiums."
She went on: "The Government should consider requiring claimants to provide proof that they have either been seen by a doctor or attended A&E shortly after the accident.
"There should be a presumption against accepting claims where adequate proof of injury is not provided."
The number of fraudulent and exaggerated whiplash claims has contributed to the increase in motor insurance premiums in recent years.
But the committee said the absence of comprehensive statistics about road traffic accidents meant that it was impossible to relate the increasing number of personal injury claims in recent years to the number of accidents.
Mrs Ellman said: "The Government has claimed that the UK is the 'whiplash capital of the world', but without reliable data on road accidents we cannot say whether that statement is true or not."
She went on: "We were concerned to hear suggestions from insurers that medical reports routinely overstate the likely duration of whiplash symptoms."
Mrs Ellman added: "Many claims are genuine and relate to real injuries which can affect people for months or years. In the debate about how to reduce fraud and exaggeration, genuine claimants should not be demonised simply because their condition cannot be picked up on a scan."
Justice Minister Helen Grant said: "Honest drivers should not have to bear the price of a whiplash claims system which has been abused and has contributed to increased insurance costs.
"We have already made major law changes to turn the tide on compensation culture to help ordinary people with the cost of living - and we have heard this week that insurance premiums are now falling as this starts to make an impact."
She went on: "We have consulted on further measures to tackle the issue of bogus whiplash claims, including improving medical diagnosis and ensuring questionable claims can be challenged in court.
"We are grateful for the committee's work on this issue and will consider their views as we decide on our next steps. We agree with them that people must continue to be able to make genuine claims."
Association of British Insurers' motor insurance head James Dalton said: "The industry remains committed to paying genuine whiplash claimants fair compensation in as short a timeframe as possible.
"However, for too many dishonest motorists whiplash has become the fraud of choice, increasing motor premiums for everyone."
He said the Transport Committee was "right to identify the need to tighten up the requirements for those submitting whiplash claims".
"There has been a growth in recent years in claimant lawyers and claims management companies encouraging people to submit an increasing number of frivolous or exaggerated claims. Whiplash now costs UK motorists over £2 billion a year, adding £90 to the average premium.
"Following recent reforms to the civil litigation system, insurers committed to pass on cost savings to motorists. We have delivered on that commitment and average premiums have reduced by 10% in the last year.
"The committee's report has kicked into the long grass making the tough calls for reform that are needed to help insurers combat the whiplash epidemic and deliver further premium reductions for hard-pressed motorists."