Portability

What Does Portability Mean?

Portability refers to the insured’s right to maintain their insurance coverage even if they lose their job, transfer to another employer, or experience a health condition that prevents them from working.

Insuranceopedia Explains Portability

Portability is a crucial feature of group insurance benefits, which are typically work-related or provided by an employer. Without portability, the insured may lose coverage if they lose their job. Portability addresses this issue by allowing the insured to maintain their coverage as long as they continue to pay the premiums. However, converting a group life insurance policy to an individual policy can be expensive. Anyone weighing whether to convert a group policy or buy a new one should compare the two costs side by side, since the average cost of an individual life insurance policy varies a lot by age and health. In many cases, rates from the best life insurance companies on the open market are cheaper than the converted premium an employer’s group plan offers.