A procedure in which a primary insurer acts as the insurer of record by issuing a policy, but then passes the entire risk to a reinsurer in exchange for a commission.
Often, the fronting insurer is licensed to do business in a state or country where the risk is located, but the reinsurer is not. The reinsurer in this scenario is often a captive or an independent insurance company that cannot sell insurance directly in a particular country.
A situation where one insurer issues policies and reinsures all or substantially all of the risk to another insurer.
Fronting typically is used in jurisdictions where the reinsurer is not licensed to do business.