Insurers will be left in a claims wilderness following the Claims Standards Council's (CSC) warning that it could take more than two years for claims farmers to be regulated effectively.
Tony Burns-Howell, chief executive of CSC, told delegates at a Labour Party fringe meeting that "there will be a two-year period before regulation begins to take effect."
The reluctance of claims management companies to voluntarily self-regulate, he said, had forced the government to push statutory regulation through parliament.
The government is due to debate the first draft of the Compensation Bill in November. Burns-Howell said regulation should touch "everyone who handles a claim."
It should look to restrict the activities of claims farmers who sought to go offshore to avoid regulation.
There must also be provisions for rehabilitation reform, and further regulation of scurrilous claims advertising, he added.
The Secretary of State for Constitutional Affairs, Lord Falconer, said regulation would affect "intermediaries" in the claims process. Proposed new legal legislation, he said, would bring further regulation to law firms.
But Burns-Howell said: "We are not looking for FSA regulation, it will not work."