With increased competition in the health insurance market, it is worth comparing offers to get the best cover, writes Claire Shoesmith

With State-owned health insurer VHI increasing its prices by an average of 8.5 per cent last Saturday and smaller rival Vivas Healthcare running a promotional campaign offering discounts to anyone who signs up before the end of September, there is no doubt that competition in the €1.2 billion- a-year health insurance market is hotting up.

In fact, if you listen to Deirdre Ashe, marketing manager at Vivas, an average of about 100 families a day are currently signing up to the insurer's health plans. The majority of these consumers are coming from Vivas's main rival and market leader VHI, although some are moving from the other player in the market, Quinn Healthcare.

There are even some newcomers who are adding to the 2.2 million people, or 51 per cent of the population, with health insurance by taking out policies for the first time, says Ashe.

After all, there's never been a bigger lure than saving money. According to Ashe, families can save almost €500 a year by signing up to a family health insurance plan with Vivas rather than VHI. (According to both companies' websites, the cost of covering a family on VHI's Plan B - its best-selling scheme - is €1,813.16 a year, while a family on Vivas's We Plan Level 2 - its equivalent best- selling programme - is €1,420.5.

It is worth noting, however, that this is a special discount rate available only until September 24th. It is believed that Vivas is due to put up its prices again in October as it did last year.

It is important to note that a cheaper plan will not necessarily have the same levels of cover as a more expensive policy and that special promotions only last for a certain length of time.

Aongus Loughlin, healthcare consultant at employee benefit firm Watson Wyatt, agrees that there can be a lot of confusion when assessing the differences between the available policies. With almost €2,000 between the cheapest and the most expensive on the market, the incentive to choose the right one has never been greater so it is definitely worth shopping around.

Loughlin advises that the best way to go about choosing a policy is first to consider how much you are prepared to pay and second, to decide what sort of hospital you are prepared to stay in. This will, he says, make your decision a lot easier.

Most policies cover the provision of either a private or semi-private room in a public hospital, though if you are prepared to pay more, you can be treated in a private room in a private hospital and, at the top levels, in the Blackrock Clinic or the Mater Private.

To receive the top level of cover, a single adult is looking at spending anywhere between €1,600 and €2,100 a year, compared with as little as €360 a year for the most basic level of hospital cover.

It is important to note though that private beds in public hospitals may be allocated on a first-come, first-served basis. If the bed isn't available, you won't be able to have it even though you are covered for such a provision in your insurance policy.

The other thing to consider, according to Loughlin, is outpatient cover, which can be very limited in the case of some policies and carry substantial excesses in others. This can be a problem if you have to make several visits to the doctor and pay out for a prescription each time.

For example, if the allowable amount for a visit to your GP is €15 and the outpatient excess is €300 a year, you would need to make 20 visits to your GP in a year before you can make a claim. And even after that, you will only be able to claim €15 a visit, even though the visits to the GP may cost between €50 and €60.

All of the main insurers' best-selling policies - Quinn's Essential Plus, VHI's Plan B and Vivas's We Level 2 - offer very limited outpatient cover, but Loughlin says such provisions are becoming more popular as the insurers move towards life-stage policies that focus on a consumer's particular needs at each different stage of their life. That could be cover abroad while they are a student, good maternity benefits when they are young adults and specialist cardiac care when they get older.

According to Kevin Kinsella, senior healthcare consultant at Mercer, cover for high-tech hospitals that specialise in cardiac care is becoming an increasingly sought-after benefit and, if you have a history of heart problems in your family or are no longer as fit as you used to be, it may be worth checking your policy to see if you are covered.

For younger people, meanwhile, the priority may be maternity benefits. While the three main policies mentioned above offer a similar level of care (though Vivas's We Plan is alone in providing up to €100 a day for three days of post-natal home help), it is possible to seek out additional benefits and it may be worth inquiring with your insurance adviser.

With the number of available products spiralling from about 10 a decade ago to more than 140 today, there is no doubt that the act of choosing a health insurance plan is not to be taken lightly.

With advertisements proliferating and policy booklets increasing in size, there is a danger consumers will become so inundated with information that they just switch off, pay the premium and hope they will never have to use it.

Still, if you do make the wrong decision, you are perfectly entitled to swap. As a consumer you have a legal right to change provider and the insurer is obliged to waive the waiting period penalties (when initially signing up for a policy, you have to wait a certain number of weeks or months before you are covered for some forms of treatment), provided the gap is no more than 13 weeks and that you are not upgrading your level of cover.

The Health Insurance Authority has recently launched a new six-figure advertising campaign aimed at increasing awareness of the right to switch and is currently updating its latest research, which two years ago showed that only 1 per cent of the insured population switched providers each year.

The association's main aim this time around is to ensure that the 40 per cent of people who last time claimed they didn't know they were able to switch, are now fully aware of their rights.

So read the small print and check that you are covered for everything you would like to be. If not, then find someone who will give it to you.

• Further information is available on the individual insurer's website at www.quinn-healthcare.com, www.vhi.ie and www.vivashealth.ie, or at the HIA's website at www.hia.ie. The HIA can be contacted on 01 406 0080.