First, as shown in my earlier example of how liability structure affects capital needs, the largest segment of a traditional insurance company’s liabilities is composed of contingent claims based on the occurrence of specified events, such as the death of an insured person or destruction of insured property.
These claims cannot be accelerated at the discretion of the holders of the contracts so, unlike deposits in a bank, these liabilities cannot run in any meaningful sense. Unless customers decide to sever their relationship with the company, in which case the contingent liability will be reduced or eliminated, they will continue to provide funding to the firm.