Portability is a new dimension in the service sector: Case of Insurance Sector

Abstract

News in early October has reported that the portability implementation has come to India. They referred to the ‘portability’ of health insurance, an option which would subsequently be expanded to general insurance policies too. This means that the insurance holder—who in an erstwhile process was stuck to one company for his/her life span—could now choose to switch between companies if he/she finds the offerings or service levels better at a different company. This has multiple implications across different levels in the insurance sector. There is an argument that it would benefit the policy holder. But there are also challenges that such a change—like portability in this case—can pose to the operations of the industry. This paper explores what exactly ‘portability’ brings in to the insurance sector. In the process, the authors try to identify if this ‘portability’ in insurance sector has any similarity with ‘portability’ of mobile numbers in the telecom sector, exploring if there are any lessons to be learnt. Perhaps, portability itself is a new dimension in the service sector.