What is scaling provision in SAP FS-PM - Policy Management?

SAP Term: scaling provision

• Component: FS-PM

• Component Name: Policy Management

• Description: Indicates how an insurance benefit is paid out, on the basis of specific rules. Example In accident insurance, the following scaling provisions may apply for per diem hospital benefit: From Day 7: Full Amount From Day 43: Full Amount Day 1 to Day 7: 50%; Days 8-21: 100%; From Day 22: 200%

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• Key Concepts: 
  Scaling provision is a feature of the FS-PM Policy Management component of SAP. It allows users to define a set of rules that will automatically adjust the amount of a payment or other financial transaction based on certain criteria. For example, a user could set up a rule that would increase the amount of a payment if the customer's credit score is above a certain threshold. 
  
  How to use it: 
  To use scaling provision, users must first define the criteria for when the scaling should take place. This can include factors such as customer credit score, payment amount, or other variables. Once the criteria have been set, users can then define the rules for how the payment should be adjusted based on those criteria. For example, if the customer's credit score is above a certain threshold, then the payment amount could be increased by a certain percentage. 
  
  Tips & Tricks: 
  When setting up scaling provision rules, it is important to consider how these rules will affect other parts of the system. For example, if payments are increased due to a customer's credit score, then this could have an impact on other areas such as accounting or inventory management. It is also important to consider how often these rules should be updated in order to ensure that they remain relevant and effective. 
  
  Related Information: 
  For more information about scaling provision in SAP FS-PM Policy Management, please refer to the official SAP documentation at https://help.sap.com/viewer/product/FS-PM/latest/en-US/fspm_policy_management_scaling_provision_overview.html