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I must admit that was my (completely naive) understanding - If a insurance policy was 'invalid' for whatever reason (no MOT, incorrect engine etc etc) it was as if the policy never existed, hence no payment to third parties.

Interesting to hear otherwise opinions however.
 
the downside is that you'll be on everyones insurance black list for ever & a day, and your future premiums will rise or worst of all you'll be refused insurance.