ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has acknowledged the Sindh government for introducing amendments to the Motor Vehicles (Amendment) Act 2026, making third-party liability insurance mandatory for all vehicles registered in the province.

The move will enhance financial protection for road accident victims and enhance road safety measures. The SECP has expressed the hope that other provinces will adopt similar steps.

SECP has said that efforts were underway with the Punjab Provincial Transport Authority to link the vehicle route permit regime with the Motor Insurance Repository for online validation of insurance policies, further strengthening enforcement mechanisms nationwide.

The commission has been consistently engaging with provincial governments to strengthen the legal framework and guarantee effective enforcement of mandatory motor third-party insurance nationwide.

SECP hopes other provinces will follow suit

Through this amendment to the Provincial Motor Vehicles Ordinance, 1965, a new Section 67-H has been introduced requiring third-party liability insurance for motor vehicles.

Under the revised framework, no vehicle will be registered, transferred, or allowed to pay annual token tax without a valid insurance policy covering third-party risks.

Third-party motor insurance is a simple and cost-effective policy that covers legal liabilities for damage to property, injuries, or death caused to another person in an accident.

The amendment also introduces defined compensation limits on a no-fault basis, ensuring timely financial relief to victims or their legal heirs.

The compensation covers Rs700,000 in the event of death and Rs500,000 for permanent disability, greatly enhancing protection for road users.

With this reform, Sindh has become the first province in Pakistan to effectively enforce mandatory motor third-party liability insurance through a strengthened legal framework.

To support enforcement and enhance transparency, the SECP has operationalised the Motor Insurance Repository (MIR), a centralised electronic database that records motor insurance policies issued by insurers registered with the Commission.

The system allows digital verification of insurance policies and assists in ensuring compliance with minimum legal requirements during vehicle registration.

Published in Dawn, March 8th, 2026