Risk-Based Capital (RBC) is a method used to measure the minimum amount of capital required by an insurance company to support its overall business operations and mitigate risk. This article delves into the historical context, key components, mathematical models, and the importance of RBC in the insurance industry.
Capital Requirement refers to the permanent financing needed for the normal operation of a business, including long-term and working capital as well as the investment in fixed assets and normal working capital.
