Sindh enforces 3rd-party motor insurance, raises accident compensation to Rs700,000

According to the Securities and Exchange Commission of Pakistan (SECP), the new system enables eligible victims to receive compensation through an automated

Karachi: Sindh has officially implemented the Motor Third Party Insurance Law, significantly increasing compensation for road accident victims from Rs20,000 to Rs700,000.

According to the Securities and Exchange Commission of Pakistan (SECP), the new system enables eligible victims to receive compensation through an automated process, eliminating the need for lengthy court proceedings.

The SECP said the enforcement of mandatory third-party insurance has led to a sharp rise in commercial vehicle insurance coverage. The number of commercial vehicle insurance policies has surged from around 11,000 to more than 165,000, marking an increase of approximately 1,300%.

Following the successful rollout in Sindh, authorities are preparing to extend the motor third-party insurance framework to Punjab, Khyber Pakhtunkhwa, and Balochistan.

The SECP also highlighted broader reforms in the insurance sector, including the introduction of life insurance annuity products for retirees, the establishment of a consortium of insurance companies for crop insurance, and the continued growth of the Takaful industry, which now accounts for 14% of Pakistan’s insurance market.