SECP Backs Sindh’s Mandatory Third-Party Insurance Move

KARACHI: The Securities and Exchange Commission of Pakistan (SECP) has officially endorsed the Sindh government’s recent decision to make third-party motor insurance compulsory for all vehicles operating within the province. The policy, officials say, is designed to bolster financial protection for road users and provide timely compensation to victims of traffic accidents.

In an official statement, the SECP described the move as a “significant milestone” in strengthening both road safety and financial security for motorists and pedestrians alike. Under the new regulation, every vehicle owner in Sindh is required to obtain third-party insurance coverage. This coverage ensures that individuals affected by accidents caused by insured vehicles receive adequate financial assistance, reducing the economic burden on accident victims and their families.

The SECP emphasised that third-party insurance is a globally recognised instrument for delivering financial relief following road traffic incidents. By mandating such coverage, authorities in Sindh are aligning with international best practices, while promoting accountability and responsible driving among motorists.

Officials further highlighted that the policy is expected to support the stability of Pakistan’s insurance sector. “Mandatory third-party insurance not only safeguards accident victims but also strengthens the overall resilience of the insurance market,” the SECP stated. The commission also confirmed its commitment to collaborating closely with provincial authorities to ensure the effective implementation and enforcement of the regulation, alongside initiatives to raise public awareness about the importance of motor insurance.

The introduction of this policy comes amid mounting concerns over the financial implications of road accidents. According to recent estimates, traffic collisions in Sindh result in significant economic losses each year, affecting thousands of families. By making third-party insurance compulsory, the government aims to guarantee that victims have access to reliable compensation and support, while also fostering a safer driving culture.

Key Highlights of Sindh’s Mandatory Third-Party Insurance Policy

The SECP’s support underscores the regulatory body’s commitment to protecting consumers, improving insurance penetration, and reinforcing road safety standards across the province. As implementation begins, both authorities and the public are encouraged to engage actively to ensure the policy achieves its intended impact.