One main characteristic of SAP FPSL is the clear distinction between financial instruments on the one hand and insurance contracts on the other hand. This, however, does not mean that insurances for instance are limited to the functionality of the subledger accounting for insurance contracts. Insurances that possess a portfolio of financial instruments or reinsurances that are active in the context of capital markets instruments can in fact use both the subledger accounting solution for insurance contracts and financial instruments.
From a technical perspective, SAP FPSL is deployed as an add-on to SAP S/4 HANA. This, however, does not necessarily mean that S/4 HANA is a prerequisite for FPSL.