Insurance companies have agreed to fund a new Garda unit that will be dedicated to investigating insurance fraudsters.
The new fraud group will be funded by insurers but will be operationally independent of them. It is being modelled on a similar fraud-buster unit in the UK.
The move to have a specialised Garda section investigating false insurance claims is expected to ease the pressure on premiums which have been shooting up for drivers and businesses.
It is estimated that fraudulent claims add at least €50 a year to the cost of every motor policy. Around one in 10 claims is thought to be spurious or exaggerated.
Insurers will collectively pay around a €1m a year to the State to fund the new fraud unit, it is understood.
The Government's Cost of Insurance Working Group recommended two years ago that a dedicated Garda unit be set up to focus exclusively on insurance fraud.
The new unit will form part of the Garda National Economic Crime Bureau, which is headed up by Detective Chief Superintendent Pat Lordan.
Plans already discussed between the Department of Justice and the Economic Crime Bureau involve allocating two detective sergeants, and 10 detective gardaí to the unit.
There is no need for legislation to be introduced and the new unit could be in place by the end of the year.
Already some 44 gardaí have been awarded diplomas in fraud detection in UCD.
These gardaí would offer support from around the country to the central operations of the insurance fraud-busters based in Harcourt Street in Dublin.
Spurious cases would likely be referred to it by insurers.
Drivers have been hit by hikes in premiums of around 70pc in the past few years, although the rises have eased off lately, according to official figures.
Businesses and charities have complained of massive hikes in public liability cover, putting their operation under threat.
A claims culture, which means there is seldom any consequences for those making false claims, is repeatedly blamed by insurers for the insurance crisis.
A letter sent by Insurance Ireland chief executive Kevin Thompson this week to Minister of State in the Department of Finance Michael D'Arcy indicates that insurers have finally agreed to fund the new unit.
Mr D'Arcy, who heads up the Government's Cost of Insurance Working Group, was told: "Following a detailed analysis of the operation of the Insurance Fraud Enforcement Department operated by the City of London Police, and the high-level costings from An Garda Síochána, Insurance Ireland is pleased to inform you that industry funding of a Garda Fraud Investigation Group is being recommended."
Insurance fraud is estimated to be a €200m-a-year industry.
And award levels here are among the highest in Europe. They are three times higher than in the UK, providing a huge incentive for false and exaggerated claimants.
Peter Boland of the Insurance Alliance, which is demanding reform of the insurance sector on behalf of companies and charities, welcomed the setting up of the fraud-busting unit, and called on insurers to actively refer cases to it.
Concerns over the speed at which tickets for popular events were selling out, and the resale of these tickets at hugely inflated prices on secondary sites, prompted a major inquiry by the Competition and Consumer Protection Commission (CCPC).