New York Signals Major Tort Reform in 2026 Budget
Thursday, March 12th, 2026 Auto Fraud Insurance Industry Legislation & Regulation LiabilityNew York’s executive budget proposal includes a sweeping set of civil justice reforms aimed at reducing fraud, litigation costs, and rising auto insurance premiums. The measures focus heavily on motor vehicle cases, with proposed changes to the serious injury threshold that determines access to non-economic damages.
One key proposal would eliminate the 90/180-day serious injury category, which insurers have long argued allows subjective claims to proceed to trial. The budget also seeks to require juries to determine liability before considering whether the serious injury threshold is met, a procedural shift that could shorten trials and influence settlement strategy.
Additional proposals would bar recovery for plaintiffs who are more than 50% responsible for an accident and limit damages for individuals engaged in unlawful conduct at the time of the incident, such as driving while intoxicated or operating a stolen vehicle. If enacted, the reforms could significantly affect exposure analysis, claim valuation, and litigation strategy for insurers handling New York auto losses.
