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What is Fronting?
Many group and single parent captives use a U.S licensed/admitted
insurer as a fronting carrier. The insureds/owners of the captive pay
a premium to the fronting insurance company. The fronting insurance company
issues the policy, makes the filings required by state laws, pays premium
tax and assessment fees and retains a portion of the risk or cedes the
entire risk to the captive. The range of services provided by a fronting
company is negotiable and is reflected in the fronting cost.
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