Basically, it’s because people are making false claims. Even down to the point of staging deliberate accidents (and it’s surely a matter of time before an innocent third party gets involved in such an incident).
I have two suggestions which ought to help. Firstly, require, as part of the MOT test, for head restraints — the purpose of which is to prevent whiplash injury — to be fitted and properly deployed. Then, any claim for compensation for whiplash injury will require admitting to driving an unroadworthy vehicle.
And secondly, motor insurance fraud should attract an automatic driving ban.
What’s really needed, though, is for more personal injury lawsuits to be dismissed with prejudice. We don’t need any new laws for this; we just need to enforce the ones we have. Once a few people have been labelled as “vexatious litigants”, the rest will soon learn.