We in Ireland might look at the insane prices charged for health insurance in the US and think, "there but for the grace of God…" But finding the right cover for you and your family can still be nightmarish.

The VHI's announcement that it is to increase premiums by an average of 8% starting next month was hardly a surprise. After all, the not-for-profit insurer haemorrhaged money last year, losing €80m and dropping 120,000 subscribers. And that was off the back of a 23% hike last January. Even so, the VHI remains by far the biggest health insurer in the country with more than 1.4 million subscribers.

Many of those will inevitably start considering their options given that the most popular VHI plan, Plan B option, will cost more than €985 for an individual and a family with two kids will expect to pay just over €2,200 from February onward. VHI's competitors, Hibernian Aviva and Quinn Healthcare, both offer products equivalent to Plan B option and both will be cheaper, with one exception: Aviva's Level 2 Hospital Plan will cost €780 for a single person and €1,990 for a family of four, while Quinn's Essential Plus (no excess) comes in at €854 for an individual and €2,298 for a family.

You could hardly blame consumers for being complacent: the range of products available can be bewildering and narrowing them down to find one that suits your needs can be difficult. In 2001, there were 20 plans on the market; today there are 150. Despite this, only in the last year has there been a significant increase in the number of people switching provider, says Liam Sloyan, chief executive of the Health Insurance Authority (HIA).

"By 2008, only about 10% of people had switched cover since the market opened for competition in 1997. That shows that 90% of consumers hadn't switched and the main reason for that was that they were happy with their current insurer and maybe there was an element of complacency as well. However, we have seen in recent times the level of switching appearing to increase over the past 12 months," he said.

The HIA has been working to make it easier for people to compare insurance products. It recently launched a product comparison tool on its website, www.hia.ie. The comparison tool asks seven questions: the minimum level of in-patient hospital cover required; are you willing to pay an in-patient excess?; do you require cover for everyday medical expenses?; are maternity benefits important to you?; are you willing to pay outpatient excess?; do you require cover for your children?; and what is the maximum price per adult that you are prepared to pay?

Once the brief questionnaire is completed, the comparison tool will draw together all of the products that are suitable for your requirements and you can then cross check the additional benefits given with each before making your decision. The HIA estimates that the average family could save up to €400 a year by switching.

While this makes it much easier to decide which plan or provider is right for you, the tool has the added benefit of making you aware of every product that might suit your needs, including the company and corporate plans that are not quite so readily marketed by the insurers.

"Everyone has a right to buy any plan and I am not sure that is fully appreciated. The insurers have a range of plans that are marketed to companies – corporate schemes – and it is often the case that these plans may offer an individual what they want at a lower price. It is important to bear that in mind. Just because it is called a company or corporate plan, does not mean that as an individual you cannot have access to it, if it meets your needs," said Sloyan.

The providers are obliged to offer these group plans to individuals if requested and the price difference cannot exceed 10%. It is also a myth to suggest that your age or health status can mitigate against you switching to another provider or product.

"People have the right to switch. Some people might be of the view that if you are older or less healthy that you may not be able to switch because an insurer might penalise you with higher premiums or may refuse to cover you, but in the Irish community rating system, insurers cannot do that. Everyone has the right to switch, no matter what their age or health status," he said.

As long as you are switching to a similar level of cover, no waiting period should apply; you have already served this with your previous insurer. However, it should be noted that if you opt to switch and upgrade – for instance, from plan providing a semi-private room in a private hospital to a private room – the normal six-month waiting period will likely apply to the extra cover.

You can, of course, save by tinkering about with your level of cover rather than automatically opting for Plan B or its equivalents. If you are willing to pay excess on an in-patient stay – usually the first €100 or so of the bill for your entire hospital stay – you can cut your premium. On Quinn's Essential Plus (no excess) plan, an individual will pay a premium of €854, but by opting to pay excess your premium falls to €778.

Having your children covered for a private hospital is unnecessary. In most cases, children will be treated in a public hospital anyway, so unless this has already been factored into your plan (VHI's Plan B Parent & Kids product already includes reduced rates for children), you should downgrade them to a more basic plan.

Finally, if your health insurance is due for renewal or you are planning on taking out insurance for the first time, act quickly. Hibernian Aviva is offering discounted premiums for switchers for the month of January and VHI's current rates remain available until the end of the month.