Technically yes, you can change the Instance's default Collation without reinstalling by "rebuilding the system databases" via the SETUP program. This is documented in the following two places on MSDN:
However, as can be inferred from the instructions on those two pages, this is not exactly a simple / low-risk process. And, this only changes the 4 system databases, not any user databases.
There is also the undocumented
-q option for
sqlservr.exe as linked to in @irimias's answer (please see Changing the Collation of the Instance, the Databases, and All Columns in All User Databases: What Could Possibly Go Wrong? for a detailed description of the behavior of this option, as well as the potential scope of impact). This option changes all databases (system and user), but is undocumented, so not guaranteed to work 100% (but it might).
Now, while you did mention the default Collation for new databases, one should still keep in mind that it is easy enough to specify the desired Collation via the
COLLATE clause as follows:
CREATE DATABASE [NewDatabaseName] COLLATE Hebrew_100_CI_AS;
Still, that is not 100% the same as the Instance being the same Collation as the Database since some columns of various DMVs, plus
msdbs default Collation will still be the same as the Instance default, which increases the chances of getting Collation-mismatch errors. But, those can still be worked-around using the
COLLATE clause on any predicates or JOIN conditions on strings fields that get those mismatch errors.