Third-party motor insurance now compulsory in Sindh

March 07, 2026 (MLN): The Government of Sindh has amended the Motor Vehicles (Amendment) Act, 2026, which makes third-party liability insurance compulsory for all vehicles registered in the province, aiming to enhance financial protection for road accident victims.

Under the new amendment to the Provincial Motor Vehicles Ordinance, 1965, a newly introduced Section 67-H requires that no vehicle can be registered, transferred, or allowed to pay its annual token tax without a valid insurance policy covering third-party risks, according to a press release issued.

Third-party motor insurance provides basic coverage for legal liabilities arising from property damage, injuries, or death caused to another person in an accident.

The law also sets defined compensation limits on a no-fault basis, including Rs700,000 in case of death and Rs500,000 for permanent disability, ensuring timely relief to victims or their heirs.

The Securities and Exchange Commission of Pakistan (SECP) has been working with provincial governments to strengthen the legal framework and ensure effective enforcement of mandatory third-party motor insurance across the country.

To support implementation and improve transparency, the SECP has operationalized the Motor Insurance Repository (MIR), a centralized electronic database for verifying motor insurance policies issued by registered insurers.

Additionally, the SECP is coordinating with the Punjab Provincial Transport Authority to integrate the vehicle route permit system with the MIR for online validation of insurance coverage, further enhancing enforcement nationwide.

The Commission lauded the Government of Sindh for taking this significant consumer protection and road safety measure and expressed hope that other provinces would follow suit.

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