Governor Hochul Enacts Major Tort Reform In New York

On May 27, 2026, Governor Kathy Hochul signed into law portions of the new state budget, which include far-reaching, prospective changes to litigation in the New York state courts. The new laws will make it easier to defend lawsuits and will bring down settlement and verdict costs in thousands of motor vehicle cases, especially those involving “soft tissue” claims, and where the plaintiff was partly at fault for causing the accident.

• Limitations for Those Primarily at Fault: Going forward, claimants cannot recover damages if they were more at fault than the other drivers’ combined fault, as determined by the judge or jury at the time of trial. This will create significant risk for plaintiffs who proceed to trial if the evidence shows substantial fault on their part for causing the accident. While the old “joint and several” rule has not been abolished (under which a plaintiff only needs to show another driver was 1% at fault in order to obtain a complete recovery from them), the new rule will alter the fault dynamic substantially, and reduce a major talking point by plaintiffs’ attorneys during mediations and settlement talks in any case where the plaintiff was substantially at fault. Finally, we anticipate the new law will have a favorable impact on trucking defendants, who often paid more than their fair share under the old law.
   
• The “Serious Injury” Threshold: Under NY Insurance Law 5102, a claimant cannot recover damages in court unless they sustained a “serious injury” as statutorily defined. In such cases, their recovery is limited to No-Fault insurance benefits for medical expenses. One category of “serious injury” was if the claimant could not perform most of their usual daily activities for at least 90 out of the 180 days after the accident. Under the new law this “90/180 rule” has been completely repealed, a change that eliminates an entire category of “serious injury” that previously led to increased settlements and more difficulty in getting summary judgment motions granted based on New York’s “Serious Injury” statute. The new law also requires juries to decide fault before turning to the “serious injury” threshold.
   
• Caps on Recovery for Illegal Conduct: The new law limits “pain and suffering” damages to $100,000 for claimants who were involved in illegal conduct at the time of the accident; for example if the claimant was uninsured, intoxicated, or involved in a felony. This new exception does not apply to wrongful death claims.
   
• Staged Accidents: The new law expands the definition of a fraudulent act to include anyone who arranges or orchestrates a staged accident, and increases penalties for the crime. 

These important changes will not only help insurers and businesses, but will also make New York more affordable, help combat fraud, and help level the playing field for defendants in court. Our attorneys in New York will use these changes to fight for better settlements, defense verdicts and dismissals. For example, the “90/180” change will make it harder for plaintiffs to defeat summary judgment motions based on the “serious injury” threshold defense. Additionally, for the first time, if a plaintiff is determined at trial to be at least 51% at fault, they are barred from recovering damages for “pain and suffering,” which is a first in New York and significant since the first $50,000 of economic damages are not recoverable at trial because of the state's $50,000 no-fault limit. These and the other limitations on damages are unprecedented in New York. They are long overdue, and we look forward to their implementation into the system.

We are going to host a 30- to 45-minute webinar on June 4th at 3:30 pm EST to cover the above changes and how they will impact how we recommend defending and evaluating claims arising out of motor vehicle accidents in New York. Please register at this link.