Here is the text from page 1040 Could anyone explain to me why the "reduction to statutory capital requirements" is likely "to be limited in proportionate and/or absolute terms". How about non-proportionate and non-absolute term?
I assume that you understand why the reduction is limited, as there are many reasons why insurers need to hold capital other than for volatility of claims. The Core Reading then says that this limit can be proportionate (eg max 80% reduction) and/or in absolute terms (eg max reduction down to £10m). I'm afraid you'll have to tell me what you mean by 'non-proportionate' and 'non-absolute'.
