Then, by extending our model, we also examine the optimality of the different recoupment mechanisms (both existing and new) designed to reduce these contagion effects from the point of view of different stakeholders, namely, shareholders, policyholders, and the tax authority.
INTRODUCING GF ASSESSMENTS AND RECOUPMENT MECHANISMS
One of the most commonly used recoupment mechanism aiming to attenuating the potential contagion effects of GF assessments seen earlier is the PTC.
Considering the Tax Carryforward as a New Recoupment Mechanism
As we will see later in the article when we implement the model, this new mechanism is designed to yield different and attractive features that are not generally obtained by the usual recoupment provisions described earlier.
Optimality Criteria for the Different Recoupment Mechanisms