I was listening to an IIF discussion on the new method for G-SII, one actuary made mention that, in contrast to banking, "intercompany funding in insurance is incidental and does not form part of the core business model".
But take for example an Insurance group with several subsidiaries of different business lines, isn't it that sometimes the stronger subsidiary funds the weaker subsidiary in order to pay off its claims? Is this what they meant by incidental?
But take for example an Insurance group with several subsidiaries of different business lines, isn't it that sometimes the stronger subsidiary funds the weaker subsidiary in order to pay off its claims? Is this what they meant by incidental?
Intercompany Funding in Insurance