The competition has been quick to seize on the VHI's difficulties, with newcomer Vivas offering half-price cover for the children of families who defect from the stateowned insurer before midSeptember. The offer is timed for maximum impact because September is the time of year when a big chunk of VHI policies come up for renewal.

According to Vivas, which is backed by AIB and millionaire financier Dermot Desmond, families making the switch stand to save 250 if they have one child, 362 for two children, and 471 for three or more children. And the gap will become even wider if VHI gets the green light from government for the 12.5% price hike.

Vivas's savings claims are based on a family switching from VHI's flagship Plan B to its 'we plan' level 2, both of which cover a semi-private bed in a private hospital. VHI says the comparison is misleading, claiming that its cheaper Family plan gives a better benchmark for Vivas's cost surveys than Plan B. The Family plan is attractive because it covers many dayto-day medical treatments, although it will not buy you access to a private hospital.

At this point most consumers probably switch off because, just like different mobile phone tariffs, rival health insurance plans seem deliberately designed to confuse. Small differences in the level of cover on offer, or in the excesses that must be paid from consumers' own pockets before the cover kicks in, mean that direct comparisons are all but impossible. This must be one of the main reasons why so few people bother shopping around for a better deal.

The Health Insurance Authority, a government watchdog, has tried to cut through the fog by stripping down the various health plans to their bare essentials. In its analysis, there are only two things that consumers should watch out for: the standard of accommodation, including cover for private hospitals; and the extent of cover for outpatient treatment and other expenses such as medical emergencies while abroad.

On this basis, Vivas's price comparisons are vindicated because the Health Insurance Authority found few differences between its 'we plan' level 2 and VHI's Plan B in terms of the standard of cover.