What practice involves insurers sharing losses equally until a specified liability limit is reached?

The concept of "Contribution by equal shares" is the correct answer because it refers to a practice where multiple insurers involved in a particular loss share the financial responsibility equally among themselves. This method continues until the specified liability limit associated with the insured risk is met. This sharing mechanism ensures that each insurer pays an equal portion of the loss up to the limits they have committed.

In the context of insurance, this practice is utilized particularly in scenarios where more than one policy applies to the same loss, allowing for an equitable distribution of claims. This process mitigates the financial strain on any single insurer and promotes fairness in resolving claims.

The other options provided have distinct definitions and applications in insurance but do not fit the context of the question regarding equal sharing of losses among insurers. Pro rata distribution refers to a method of calculating and distributing claims based on the proportion of coverage, whereas equal indemnity is not a commonly recognized term in the insurance industry. Shared liability, while related, does not encapsulate the specific mechanism of equal contributions as accurately as Contribution by equal shares does.