New York's 2026 Tort Reforms: What Changed and Why It Matters

Kenney Shelton Liptak Nowak LLP | Civil Litigation Update

Karl E. Daniel | Partner and Patrick S. Kenney, Esq. | Managing Partner

After nearly two months of delay, New York's 2026–2027 state budget passed on May 27, 2026, carrying with it the most consequential restructuring of automobile liability law in the state in decades. Governor Kathy Hochul had made her intentions plain throughout the budget process: reduce auto insurance premiums, curb insurance fraud, and pare back what her administration characterized as a litigation environment that inflated motor vehicle claims at the expense of New York drivers. The final package, enacted as Part EE of S9008-C/A10008-C, amends Insurance Law §§ 5102 and 5104, amends CPLR § 1411, and repeals CPLR § 1602(6). The changes apply to all actions and proceedings commenced on or after May 26, 2026.

Below is an overview of what was enacted. Subsequent articles in this series will examine each major provision in greater detail.

The Legislative Context

New York has long operated one of the more plaintiff-favorable automobile litigation regimes in the country. The state's no-fault system, governed by Article 51 of the Insurance Law, requires minimum personal injury protection coverage of $50,000, which is the highest minimum in the nation. 

Plaintiffs who clear the "serious injury" threshold under Insurance Law § 5102(d) may sue for non-economic damages on top of their no-fault benefits, even if they are primarily at fault for the accident. Further, unlike most states, New York applied a rule of pure comparative negligence: a plaintiff 99% at fault could still recover 1% of their damages.

Those laws, combined with what insurers and defense practitioners have long described as broad threshold categories and favorable interest accrual rules for plaintiffs, led to a litigation environment that Governor Hochul and industry groups argued was driving auto insurance premiums to unsustainable levels. 

The reforms represent a legislative compromise (significant by New York standards) that moves the state toward the mainstream without fully abandoning its plaintiff-protective tradition.

The Four Core Changes

Elimination of the 90/180 Serious Injury Category

The first and most significant change is the outright repeal of the 90/180-day category of serious injury under Insurance Law § 5102(d). Under the prior law, a plaintiff could establish serious injury by showing a medically determined condition that prevented performance of substantially all daily activities for at least 90 of the first 180 days following the accident. 

That category had long drawn criticism from defense practitioners as a vehicle for soft-tissue and non-permanent injury claims that were difficult to disprove and easy to plead. Its elimination removes an entire avenue of threshold liability and will have direct effects on summary judgment practice.

The $100,000 Cap for At-Fault Claimants

New Insurance Law § 5104(d) imposes a $100,000 cap on non-economic damages for certain categories of plaintiffs whose own conduct contributed to the accident. The cap applies to: 

• Drivers who were operating an uninsured vehicle that they were responsible for insuring (with a limited exception for lapses of fewer than 30 days).

• Drivers operating while impaired who were subsequently convicted of that impairment.

• Drivers operating in the commission of a felony or in immediate flight from one, where a conviction follows. The cap applies only to non-economic loss and does not extend to wrongful death claims.

• 
  

Modified Comparative Negligence in Auto Cases

New CPLR § 1411(b) creates a carve-out from New York's longstanding pure comparative negligence rule for motor vehicle personal injury actions subject to Article 51. Under the new provision, a claimant's culpable conduct bars recovery entirely if it is greater than the culpable conduct of the defendant or defendants combined. New York retains pure comparative negligence in all other negligence contexts; this is a targeted modification applicable exclusively to the automobile no-fault regime.

Codification of Interest Accrual

The legislation also codifies the rule that liability is not established for interest accrual purposes until there is a finding of both negligence and serious injury. This resolves a conflict among the Appellate Division departments that had produced inconsistent outcomes on when prejudgment interest begins to run in motor vehicle cases, which was a question with real dollars-and-cents consequences in cases litigated over years.

The Sequencing Change

Running across several of these provisions is a new procedural requirement that deserves attention on its own terms. Amended Insurance Law § 5104(a) requires the trier of fact in Article 51 actions to resolve fault first, serious injury second, and damages third. 

Under prior practice, bifurcation was common, but the sequencing of threshold and liability findings was not uniformly mandated. The new law formalizes that sequence, which carries strategic implications for how both sides develop and present their cases at trial.

What Comes Next

The practical consequences of each of these reforms will be worked out over time — in trial courts, through motion practice, and eventually in the Appellate Division and Court of Appeals. The changes are prospective only, applying to actions commenced on or after May 26, 2026. For pending matters, the prior law governs.

Over the next several weeks, this series will examine each provision in depth: the mechanics of the 90/180 repeal and its effect on summary judgment; the structure and limitations of the bad-actor damages cap; the comparative negligence shift and what it means for cases where plaintiff fault is a live issue; and the interest accrual codification and its consequences for litigation strategy. 

Each reform raises questions that will not be answered quickly, but practitioners on both sides of the docket need to understand the changed laws now.

Kenney Shelton Liptak Nowak LLP represents municipalities, insurers, and businesses in motor vehicle litigation and insurance defense matters throughout New York. For questions about how the 2026 reforms affect pending or future matters, contact our civil litigation team.