The activities of CMCs, particularly the tactic of cold-calling holidaymakers to encourage them to make claims, has been blamed by the travel industry for the huge surge in fake sickness cases during the past 18 months.

The government had originally only planned to ban cold-calling about pensions, but this is set to be extended to CMCs following pressure from members of the House of Lords.

Minister Baroness Buscombe said the government was now “minded to bring forward similar action in relation to the claims management industry”.

Abta has been calling for the government to introduce such a ban and called the change in policy “a significant and very welcome advance in the industry’s fight against fraudulent claims”.

“Abta has always held the view that it is wrong for companies to cold-call people and encourage them to make compensation claims that cannot be justified whether for whiplash or holiday sickness,” said a spokesperson.

Liberal Democrat peer Lord Sharkey said the scale of holiday sickness claims had become “absolutely huge” in the UK and were “the successor to the whiplash scandal”.

“That kind of thing not only costs our travel industry a huge amount and raises prices for everyone but directly encourages criminal acts on a large scale,” he added.

Baroness Buscombe said: “The government is working through the detail of a ban on cold-calling by CMCs.”

The next stage in this process will be for the government in the House of Commons to put forward an amendment to the Financial Guidance and Claims Bill banning cold-calling by CMCs.