an agreement between insurance companies that has considerable practical effects for many motorists, although not strictly speaking a legal institution. The agreement means that an insurer will, under a fully comprehensive policy, pay the losses of its own insured and will not insist upon raising an action against the other companies insured. If there are uninsured losses, the motorist may have to raise his own action in any event. The idea of insurance companies giving no-claims bonuses whereby they reduce the premium charged if there is no claim means that the issue of fault still has to be resolved, although some companies may still treat the claim as a claim destroying the bonus if they have settled knock-for-knock regardless of the issue of fault. See generally Hobbes v. Marlowe [1977] 2 All ER 241.

Collins dictionary of law. . 2001.

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