The Law Society has said the insurance industry must take the blame for the rising cost of motor premiums, in a high-profile row over personal injury claims.

The Commons transport select committee last week said the rising number of personal injury claims was the ‘main reason’ for an increase in premiums.

In a hard-hitting report, the committee recommended stricter rules on the diagnosis of whiplash injuries, requiring objective evidence from an expert and proof of a ‘significant’ effect on the claimant’s life before compensation is paid out.

However, Law Society chief executive Desmond Hudson said claimants should not be scapegoats for an insurance industry that ‘has failed to sort itself out’, adding: ‘The motor insurance industry is profiting from providing what is in effect a public service, as it is a legal requirement to have motor insurance. It is up to insurers to fight cases that they feel are inappropriate. If the insurance industry simply pays out when it sees the word "whiplash" whether the case is justifiable or not, is it any wonder these claims are rising?’

He said the Society is happy to work with the government, which is currently considering its response to the report.

The Ministry of Justice is likely to view the committee’s findings on the ‘compensation culture’ as vindication of its civil litigation reforms – though the committee warned that the impending ban on referral fees will make little impact if insurance companies can merge with law firms under the umbrella of an alternative business structure.

The Forum of Insurance Lawyers welcomed the report, noting that ‘legal costs attached to [whiplash] claims have been a defining factor in the inflation of claims costs’.

The Association of British Insurers called for the ‘whiplash epidemic’ to be dealt with once and for all, and for lawyers’ fees to come under further scrutiny.

However, the Association of Personal Injury Lawyers argued that injuries like whiplash ‘can be extremely painful and can often linger’, while the Access to Justice Group said there were ‘grave concerns’ over parliament’s intervention.