Kentucky Senate Bill 195: Failed Tort Reform with Important Implications for Contractors
On April 12, 2026, Senate Bill 195 became law without the Governor’s signature after having passed both chambers of the Kentucky General Assembly. This bill was promoted as “comprehensive legal liability reform…designed to modernize Kentucky’s civil litigation system, restore balance and codify clear ethical standards into state law” and was, notably, not largely adopted in whole. See Press Release, Kentucky Senate Majority Caucus, Richardson Files SB 195 to Modernize Kentucky’s Legal Liability System and Codify Ethical Standards into Law (Feb. 12, 2026), https://kysenaterepublicans.com.
Before examining what the final legislation promulgates, it is worth noting what proposed provisions did not survive the legislative process, many of which would be considered less favorable to plaintiffs in the Commonwealth.
WHAT DIDN’T MAKE IT IN –
Seatbelt Requirements & Liability Implications
As to motor vehicle safety, the original bill proposed several motor vehicle safety requirements, including standards for seatbelt anchor systems and mandatory car seat and booster seat usage based on a child’s age and size.
The proposal also addressed how seatbelt usage could be used in litigation. Under the proposed language, evidence that a child was not using a car seat, booster seat, or seatbelt could not be used to establish negligence by the child. More broadly, a person’s failure to wear a seatbelt would not automatically constitute negligence and could not be used as evidence of negligence, comparative fault, or failure to mitigate damages unless it could be shown that the lack of a seatbelt substantially contributed to the injuries suffered.
Limitation on Third-Party Claims for Bad Faith; Evidentiary Limit on Insurance
The bill also proposed significant changes to Kentucky insurance law.
Kentucky law already prohibits insurers from engaging in unfair claims practices, including misrepresenting policy provisions, failing to reasonably investigate claims, delaying communications, and refusing payment without a proper investigation.
The proposed legislation would have prevented third-party claimants from bringing bad faith claims against insurers for violations of those requirements. It also would have declared any assignment of such claims void.
In addition, the bill proposed restricting evidence regarding liability insurance coverage and insurance policy limits in civil litigation. Such evidence generally would not have been admissible for either substantive or impeachment purposes.
Notice Requirements for Various Causes of Action
Consumer Protection Claims
The bill proposed requiring consumers to provide written notice to potential defendants at least 60 days before filing a lawsuit for any loss of money or property due to unlawful acts of the alleged defendant arising from purchase or lease of goods and/or services by the plaintiff. The notice would have been required to identify the alleged violation, the facts supporting the claim, and the damages sought. The statute of limitations would have been paused during the 60-day notice period. And failure to provide the required notice would have resulted in immediate dismissal of the lawsuit on procedural grounds. The statute went on to detail how all parties to such suits were entitled to medical records from other parties, as well as defendants’ ability to petition the courts for a qualified protective order.
Nursing Home Litigation
Not to be confused with the aforementioned, the proposed bill also set forth similar notice requirements in nursing home litigation and expanded the existing certificate of merit requirements.
Along with the Complaint, plaintiffs would have been required to file a certificate verifying whether they had obtained a written opinion (formerly, just confirmation of a “consultation”) from a qualified expert supporting the claim. If no opinion had been obtained, plaintiffs would have been required to explain either that a statute of limitations deadline prevented obtaining such opinion or that they had made good-faith efforts to obtain opinions from at least three experts who declined to provide such opinion. Such certificate of merit would not be required if the claim did not require expert testimony (i.e., for claims of res ipsa loquitur and lack of informed consent). The proposal further would have allowed parties to compel disclosure of consulted experts when the opposing side failed to present competent expert testimony and would have shifted the prevailing party’s attorney’s fees, expert witness fees, and related litigation expenses.
Personal Injury Claims
The bill also proposed a 60-day notice requirement for personal injury causes of action, again requiring the same elements as above (stating the factual allegations, claimed damages, etc.) and again, absence of such notice, being grounds for dismissal. Of note, the same suit could be filed again if the notice requirement was subsequently met.
Major Tort Reform Proposals
One of the most significant proposed changes involved Kentucky’s comparative fault system.
The bill sought to adopt what is commonly referred to as a “modified comparative fault rule,” proposing that “a claimant shall not be entitled to recover any damages if the claimant is fifty percent (50%) or more responsible for the injury or damages claimed. In cases of multiple tortfeasors, a claimant shall be entitled to recovery if the claimant’s fault is less than the combined fault of all tortfeasors.” Said more succinctly, if a plaintiff is found to be 50% or more at fault, then they recover nothing.
Quite the understatement — this would have represented a major shift in Kentucky tort law. Since the landmark 1984 Hilen v. Hays decision, Kentucky has followed a pure comparative fault system, meaning an injured person may recover damages even if he or she is mostly at fault of the accident; their recovery is simply reduced by the percentage of fault. Prior to Hilen v. Hays, Kentucky followed a pure contributory negligence scheme, meaning if a plaintiff was found to be even slightly negligent and that negligence contributed to the injury, then the plaintiff was completely barred from recovering any damages.
Medical Expense Damages
The proposed bill went further by seemingly limiting the amount of past medicals that a plaintiff could recover. In short, it was proposed that evidence to support medical damages would be limited to the amount that was actually paid or would actually have to be paid and, in contrast, not the amount listed on a hospital’s or doctor’s bill, which is commonly higher. This, in effect, would exclude the inflated “sticker price” medical bills that exceed what health insurance, Medicare, Medicaid, or other eligible healthcare programs would actually pay (i.e., any portions of bills that would be written off, discounted, adjusted, or reduced). As such, the proposed language would appear to cap the value of a litigant’s claim at what the provider could have collected through available insurance coverage.
The same principle was to apply to claims of future medical expenses. To make this clear, in practice, if an expert testified that a future surgery would cost $150,000.00 based on the hospital’s standard charges, but the hospital would accept $70,000.00 from the plaintiff’s health insurer as payment in full, then the recoverable future medical expense would be limited to the $70,000.00 and not the $150,000.00.
Impact on Kentucky’s Collateral Source Rule
This proposal would have significantly altered Kentucky’s longstanding collateral source rule.
For decades, Kentucky has been one of the strongest collateral-source jurisdictions in the country. The collateral source rule generally provides that a defendant cannot reduce the plaintiff’s damages because the plaintiff received benefits from another source, such as health insurance, Medicare, Medicaid, or employer-provided benefits. The rationale is that the wrongdoer should not benefit from the plaintiff’s foresight in obtaining insurance. In the often-cited O’Bryan v. Hedgespeth, 892 S.W.2d 571 (Ky. 1995), the Supreme Court struck down a statute that allowed evidence of collateral-source payments to be introduced at trial. The Court held that collateral-source evidence was irrelevant to the damage caused by the tortfeasor and that admitting such evidence improperly encouraged juries to reduce damage awards. The Court stated that there was no reason a tortfeasor should receive a “windfall” merely because the plaintiff had insurance or other benefits available.
As this proposed language was written, it would avoid the constitutional problem identified in O’Bryan in which the Court objected primarily to a procedural statute that merely allowed collateral-source evidence to be shown to the jury. The Court viewed that as an unconstitutional intrusion into judicial control of evidence and procedure. Here, the proposed language would be different, as it would arguably be a substantive limitation on damages and not merely an evidentiary or procedural rule.
WHAT IS NOW LAW –
Rebuttable Presumptions as to Contractor & Sub-contractor Liability
Despite not being adopted in whole, this legislation certainly has implications for a series of changes to the state’s liability scheme, including in personal injury cases, where we anticipate to see the effects played out over the next few years. Particular attention should be given to the apportionment of liability as to “dangerous conditions” and “latent defects,” and whom the new statutory language places the responsibility upon.
Of the proposed provisions that made it into the final version of the legislation, the legal community and their clients should note the following has been added:
As to contractors, the legislation creates a rebuttable presumption, upon acceptance of a project by a contracting entity (defined as the Commonwealth or any city, county, or other local government), that the contractor (including contractors, subcontractors, etc.) followed the plans and specifications of the Commonwealth or local government. As such, the contractor is entitled to the rebuttable presumption that the contractor “shall not be liable for any claims for property damage, physical injury, or death alleged to arise out of the work performed on the project in any civil cause of action unless it is established by a preponderance of the evidence that: (a) An error or omission in the design, plans, or specifications prepared by the design professional, resulting in a dangerous condition; (b) A failure of the contractor to follow the plans and specifications, resulting in a dangerous condition; or (b) A latent defect creating a dangerous condition that is the result of the work of the contractor; was a substantial factor in causing the alleged property damage, physical injury, or death.” Although, perhaps, a reasonable assumption, contractors shall follow all agreed-upon plans and specifications being guaranteed in their agreement or project proposal to the State or local government. Said another way, if a contractor does not follow their agreed-upon plans or the contractor creates a latent defect creating a dangerous condition, the contractor will lose a seemingly fairly advantageous shield against liability. Further, contractors shall create procedures for reviewing and thereby ensuring notice of any potential errors or omissions in the design, plans or specifications prepared by design professionals, whether said “design professionals” are in-house or external. Although it is likely a contractor could argue to shift liability upon some external “design professionals” for such error, contractors should be placed on notice that they may very well bear the brunt of such delineation of liability.
Not calling it quits, the new legislation creates another rebuttable presumption. Namely, as to contractors engaged in public roadway work, there is a rebuttable presumption “in any action for injury, damages, or wrongful death, in contract or in tort, against a contracting entity (Commonwealth or local government) or its contractor arising from any negligent act or omission in the construction or maintenance of a public highway, road, bridge, or street, when it is established by a preponderance of the evidence that: (1) The operator of the vehicle engaged in conduct that would have supported a violation of KRS 189A.010 or 189.292; or (2) The vehicle was traveling at a rate of twenty-five (25) or more miles per hour over the applicable speed limit; there shall be a rebuttable presumption that the prohibited conduct was a substantial factor in causing the injury, damages, or wrongful death. Said another way, if a contractor working on any public roadway work on behalf of the State is driving while under the influence of alcohol, while using a cell phone, or while traveling at a rate of speed 25 mph or higher over the speed limit, Kentucky law is going to create a rebuttable presumption of fault against said driver.
In short, many contractors provide employees with phones, tablets, GPS devices, and other communication tools for work-related purposes. While these devices may serve legitimate business needs, the new law reflects a clear legislative intent to discourage distracted driving in roadway work zones. The statute does contain exceptions allowing the use of devices for GPS navigation, entering telephone numbers, emergency communications, public-safety functions, and reporting crimes or emergencies. The legislation also authorizes the Kentucky Transportation Cabinet to adopt regulations implementing and enforcing these provisions. Contractors and employers should monitor future regulatory developments to ensure continued compliance.
KEY TAKEAWAYS
Although SB 195 did not enact the sweeping tort reforms originally proposed, the bill provides valuable insight into the direction Kentucky lawmakers may pursue in future legislative sessions. The failed proposals—particularly those involving comparative fault, medical expense damages, collateral source issues, and pre-suit notice requirements—demonstrate a continued interest in reshaping Kentucky’s civil liability system.
At the same time, the provisions that did become law create meaningful protections for contractors on public projects while also emphasizing the importance of complying with project specifications, identifying design deficiencies, and maintaining safe practices in public roadway work zones.