Legislation aimed at putting a stop to “harvesting” of motor vehicle injury insurance claims is set to be introduced in WA.

Claims harvesting activity often involves cold-calling a person involved in a car accident and pressuring them to make an insurance claim, with the promise of a large pay-out. The crash victim's personal information is then sold to law firms for a referral fee.

WA estimates 30% of its Compulsory Third Party (CTP) motor insurance claims are the result of this harvesting activity, up from 9% around five years ago.

Despite reduced car crash injuries in WA, the volume of claims made continues to increase, and $15 of every CTP insurance premium paid by WA drivers covers the cost of harvested claims, the government says.

Such claims have resulted in more being paid out in legal fees than in injury compensation.

“That money would be better spent on medical treatment for genuinely injured people,” a government media release said.

It announced the drafting of a Bill to amend the Motor Vehicle (Third Party Insurance) Act 1943 and the Insurance Commission of Western Australia Act 1986, with reform to include provisions and new offences for claim referrals and passing on personal information, as well as new laws to safeguard people from predatory behaviour.

WA Premier Mark McGowan says people injured in car crashes are vulnerable.

"The use of high-pressure sales tactics to extract information from injured people and then sell that private information to law firms or other parties is abhorrent,” the Premier said. “This will not be tolerated and my government is moving to stamp it out.”

The planned legislation, which will outlaw the referral fees, brings WA in line with Queensland, NSW and the ACT, which all introduced legislative reform to combat the “insidious” claims harvesting practice in motor injury insurance claims.