- 4 updates
Motor insurance companies are encouraging fake whiplash claims by not subjecting claimants to proper medical checks, the chair of a transport committee has warned.
Louise Ellman MP told Good Morning Britain that industry leaders "have to act more responsibly and not just pay out without an examination".
MPs have called for whiplash payouts to be banned unless victims' claims have been checked independently.
Failures in the "dysfunctional" car insurance market have "encouraged criminality" in some areas, according to the head of a parliamentary transport committee.
Louise Ellman, Labour MP for Liverpool Riverside, said: "This is our fourth report on the cost of motor insurance and while premiums are now falling, aspects of the market remain dysfunctional and have encouraged criminality to take root.
She said further action was needed to tackle fraud which the report said is pushing up insurance prices for motorists.
Motor insurance is a "highly dysfunctional market" which has seen a drive for profits push up prices for consumers, a critical report from MPs has said.
They warned that "new forms of potentially dishonest practice" were emerging, including a new trend for ordering extra medical reports claiming psychological harm from road accidents.
A report called for more work to root out fraudulent claims, including a compulsory scheme to share data between insurers and solicitors.
It also said that lawyers should be banned for offering freebies such as cash or tablet computers to people considering making claims for car accidents.
Car insurers could be banned from paying compensation to whiplash claimants who have not undergone medical tests to check whether their injuries are genuine, a new report from MPs has said.
They said that insurers are too willing to pay compensation even when they suspect claims are fraudulent, said a report from the Transport Committee.
The committee said steps were being taken to prohibit insurers from offering to settle whiplash claims before the claimant had undergone a medical examination.
"We agree and would like to see this practice banned altogether," they said.