Can different policies apply to security groups in a parent-child relationship?

Yes. The parent and child groups in the hierarchical structure of the Security Groups have been designed so that each of the groups can have a different policy. The child group does not inherit the parent group’s policy by default. This is similar to the OU structure behavior for G Suite users. 

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*Ensure that you do not have more than one group with the same name. If you do, both/ all of them will be assigned the same policy. You cannot assign different policies to each of them. 

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