Preface: I am a developer in the IAMbic repo, so indeed my perspective is biased. Developers have individual preferences. My response is to discuss the design trade/offs why we decided to invest in IAMbic.
“possible with Terraform (albeit an extra step or utilizing something like terragrunt).“
During the design phase, we thought about writing a transpiler to go from YAML to HCL2 to be terraform-compatible. However terraform constraints and our own terraform experience at previous companies have steered us away from that option. Here are a few reasons as to why: