The Icelandic international has been allowed to leave Pompey on a free transfer as his contract at Fratton Park was due to expire in the summer.
"I am delighted we have been able to get this deal done," Coventry manager Andy Thorn told the club's official website.
"Hermann has a great track record and is just the sort of player we need to bring experience to the squad.
"We've got a fight on our hands between now and the end of the season and he's exactly the type of player you want on your side."
Hreidarsson has also played for Crystal Palace, Brentford, Wimbledon, Ipswich Town and Charlton Athletic.