What is "knock-for-knock agreement"

n. An arrangement between multiple insurance company in which each company pays the losses incurred by its own policy-holders in an event regardless of who was at fault (now, used almost only for motor insurance)

A knock-for-knock agreement is an agreement between two insurance companies whereby, when both companies' policy-holders incur losses in the same insured event (usually a motor accident), each insurer pays the losses sustained by its own policy-holder regardless of who was responsible.