2025 Transportation Law Compendium: Litigation Practices (AI/Nuclear Verdicts) Question 3

No, Alabama has not enacted any legislation impacting coverage offered to an insured after the insured receives a nuclear verdict.

No, Alabama has not enacted any legislation impacting coverage offered to an insured after the insured receives a nuclear verdict.

As of now, Alaska has not enacted specific legislation that directly alters or limits insurance coverage for an insured following a nuclear verdict—a jury award typically exceeding $10 million. However, the broader impact of such verdicts is being felt across the insurance landscape in Alaska, as insurers respond to rising risks by adjusting coverage limits, raising premiums, and tightening underwriting standards.

No. Efforts have been brought in 2024 and 2025, but they have failed to secure sufficient votes in the legislature.

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No. California has not enacted any legislation specific to a nuclear verdict alone.

Though nuclear verdicts are on the rise, Colorado has not officially enacted any legislation that impacts the insured’s coverage. Companies are aware of the rise nonetheless which might eventually lead to legislature changes.

No. Connecticut recognizes Motions for Remittitur when a verdict shocks the conscience and is plainly excessive or exorbitant. The trial court is afforded broad latitude and its decision to grant a motion for Remittitur, or Additur, is reviewed on an Abuse of Discretion standard.

The court’s broad power to order a remittitur should be exercised only when it is manifest that the jury [has] included items of damage which are contrary to law, not supported by proof, or contrary to the court’s explicit and unchallenged instructions.” Mahon v. B.V. Unitron Mfg., Inc., supra, 284 Conn. at 661–62, 935 A.2d 1004.

Delaware has not enacted any legislation providing impact coverage to an insured after the insured receives a nuclear verdict.

There does not appear to any legislation regarding impact on coverage to an insured after the jury issues a nuclear verdict.

No.

No. While the Georgia General Assembly passed substantial tort reform legislation on April 21, 2025, the legislation did not address these issues.

For more information, please contact:

ALFA International Headquarters
980 N. Michigan Avenue, Suite 1180
Chicago, IL 60611
Phone: (312) 642-2532

No.

Illinois has not enacted any legislation that affects future coverage after an insured receives a nuclear verdict. To the contrary, there is legislation limiting an insurer’s ability to inquire into anything irrelevant to an insured’s level of risk. For example, an adverse underwriting decision may not be based on “a previous adverse underwriting decision or the fact that an individual previously obtained insurance coverage through a residual market mechanism,” nor may it base decisions solely on information received from an insurance support organization relying primarily on insurance institutions. 215 ILCS 5/1013. This indicates that Illinois courts would likely consider a high verdict irrelevant information if the issue were to arise.

No, Indiana has not enacted any legislation to impact coverage offered to an insured after the insured receives a nuclear verdict.

No, Iowa has not enacted any legislation impacting coverage for insureds who have received a nuclear verdict. However, in 2023, the Iowa legislature updated Iowa Code Section 668.15A to limit noneconomic damages against trucking companies to five million dollars ($5,000,000.00). See Iowa Code § 668.15A (2025). The cap applies regardless of the number of derivative claims or theories of liability. See Id. This, in turn, serves to limit nuclear verdicts in this state against trucking companies. This legislation does not include any discussion of impact coverage for those who would be affected by the change.

No. Kansas has not enacted any legislation that impacts the amount of coverage an insured may receive following a nuclear verdict.

No, we are not aware of any such legislation.

While Louisiana has not enacted specific legislation addressing impact coverage after a “nuclear verdict”, the state has recently enacted a tort reform package to assist in limiting the potential for “nuclear verdicts”.

A comprehensive package of tort reform bills was signed into law by Gov. Landry as of August 5, 2025. These reforms include:

• Requiring claimants to prove injuries occurred during the accident (HB 450).
• Barring uninsured drivers from collecting damages unless injuries exceed $100,000 (HB 434).
• Amending comparative fault rules to bar recovery if the plaintiff is primarily at fault (HB 431).
• Measures addressing social media misuse, safety tech incentives, and insurance rate oversight.

Modified Comparative Fault & “No Pay, No Play” Threshold
Effective January 1, 2026, Louisiana will shift from a pure comparative fault system to a modified standard, limiting recovery for plaintiffs who are primarily at fault.

Additionally, the ‘No Pay, No Play’ threshold increased to $100,000, restricting recovery for uninsured drivers with minor injuries. This change became effective August 1, 2025.

A key Louisiana Supreme Court decisioni established that some measure of objectivity must be incorporated into the determination of an award’s reasonableness, providing a standard for comparison. The Court emphasized that appellate courts should consider relevant prior general damage awards in similarly situated cases as guidance in determining whether a general damages award constitutes an abuse of discretion. This new standard aims to discourage excessive awards of noneconomic damages.

Louisiana ranked 8th nationally for nuclear verdict payouts in 2024, with over $733 million in awards. The recent reforms aim to reduce excessive awards by tightening rules on damages and claim eligibility.

No.

Maryland has not enacted any specific legislation directly addressing insurance coverage for an insured after the insured receives a nuclear verdict.

For more information, please contact:

ALFA International Headquarters
980 N. Michigan Avenue, Suite 1180
Chicago, IL 60611
Phone: (312) 642-2532

Michigan has not enacted this legislation.

Minnesota has had several nuclear verdicts in recent years; however, no legislation has been enacted to impact an insured’s insurance coverage following a nuclear verdict.

No. Mississippi has not enacted such laws.

No.

Though nuclear verdicts are on the rise, Montana has not officially enacted any legislation that impacts the insured’s coverage. Companies are aware of the rise nonetheless which might eventually lead to legislature changes.

Nebraska has no law that caps or modifies an insured’s coverage following a nuclear verdict. Therefore, an insurer cannot be required to provide coverage that goes beyond an insured’s policy limits following nuclear verdict.

There is no statutory framework in Nevada that limits or adjusts an insurer’s obligations based on the size or nature of a verdict, even if the award far exceeds policy limits. Instead, post-verdict coverage disputes are typically litigated under common law bad faith doctrines. Nevada recognizes both first-party and third-party bad faith claims, and an insurer’s failure to settle within limits when liability is reasonably clear can expose the carrier to extra-contractual liability, including the full amount of a nuclear verdict.

There is no legislation generally impacting coverage following a nuclear verdict, but “an insurer has a duty of reasonable care in the settlement of a third-party liability claim. Therefore, a breach of that duty may give rise to an action in tort.” Bennett v. ITT Hartford Grp., Inc., 150 N.H. 753, 757, 846 A.2d 560, 564 (2004). New Hampshire courts recognize an independent cause of action in tort for third-party claims to “address the dilemma presented by the absolute control of trial and settlement vested in the insurer by the insurance contract and the conflicting interests of the insurer and insured.” Id. (quotation omitted). In a third-party claim, the “insurer is in a position to expose the insured to a judgment in excess of the policy limits through its refusal to settle a case or to otherwise injure the insured by virtue of its exclusive control over the defense of the case.” Id. at 758. “Because the insurer and the insured have conflicting interests, and the insurer has absolute control over the situation, an insurer has a duty to the insured to act in good faith” in a third-party claim. Id.

New Jersey has not enacted legislation specifically targeting nuclear verdicts.

At this time in New Mexico, no.

For more information, please contact:

ALFA International Headquarters
980 N. Michigan Avenue, Suite 1180
Chicago, IL 60611
Phone: (312) 642-2532

No, North Carolina has not enacted any specific legislation addressing or requiring insurers to provide additional or impact coverage for an insured after the insured receives a nuclear verdict. When facing a nuclear verdict without impact coverage, insurance turns largely on the policy limits, any aggregate reinsurance layers, and standard liability exclusions included in the policy language.

An insured can proactively include punitive damages coverage and/or excess liability insurance coverage layers.

In North Dakota, artificial intelligence has been addressed in certain contexts, and laws exists concerning punitive damages. However, the state has not enacted legislation that directly governs whether an insurer must cover a nuclear verdict after it has been issued. Instead, coverage issues are shaped by general insurance statutes, punitive damages law, and the terms of the policy itself.

The insurability of punitive damage from a nuclear verdict depends primarily on the wording of the insurance policy. Some policies are silent. While many expressly exclude punitive or exemplary damage. Where a policy does not exclude such damages, North Dakota, like many states, has followed the public policy that insurance should not cover punitive damages because doing so undermines their purpose of punishment and deterrence. Nonetheless, North Dakota Supreme court has allowed coverage of punitive damages in certain cases where the policy language created ambiguity about coverage.

North Dakota has also passed legislation on AI, but it applies only to specific contexts rather than general liability coverage. For example, Senate Bill 2280 (2025) regulates AI in healthcare, requiring that final prior authorization denials be made by licensed physicians, not AI systems.

However, no law currently addresses AI liability in claims processing or insurance coverage in the event of a nuclear verdict.

Ohio has not adopted any specific legislation targeting so-called “nuclear verdicts.” However, as discussed above, RC 2315.18 strictly limits noneconomic damages awards and the evidence a jury can consider when awarding them. RC 2315.19, which empowers the trial court to review the award of compensatory damages for noneconomic loss, enforces this provision. Some sources lay the blame for nuclear verdicts at the feet of the plaintiff’s bar, which often appeals to underlying juror emotions, cultural attitudes, and stereotypes about companies generally and insurance companies specifically to obtain high awards. RC 2315.18 empowers the judge to examine those motivations and determine if inflamed passion or prejudice, improper consideration of the company’s wealth, or considerations of guilt influenced the verdict.

There is currently no statute in Oklahoma that alters or restricts insurance coverage available to an insured after a nuclear verdict. However, the recent enactment of SB 453 is expected to reduce the likelihood of nuclear verdicts by imposing a $500,000 cap on non-economic damages in most personal injury cases, subject to certain exceptions.

Oregon has not enacted any legislating impacting insurance coverage after a nuclear verdict.

Pennsylvania has not enacted any legislation impact coverage offered to an insured after the insured receives a nuclear verdict.

There is no legal authority on this issue in Rhode Island. Rhode Island has not enacted any specific legislation that directly alters or restricts insurance coverage available to an insured following a nuclear verdict.

South Carolina has not yet enacted any legislation specifically addressing insurance coverage to an insured after the insured suffers a nuclear verdict.

Nuclear verdicts in South Dakota are not common. No legislation has been enacted to impact an insureds insurance coverage following a nuclear verdict.

In Tennessee, when a jury issues a “nuclear verdict”—an exceptionally large award exceeding the policy’s limits—the insured party may sue their insurer for the excess amount if they can prove the insurer acted in bad faith. A nuclear verdict can expose an insured to personal liability for the amount beyond what their policy covers.

Tennessee law requires an insurer that has exclusive control over a claim’s investigation and settlement to act in good faith when handling claims.

Failure to settle: An insurer can be held liable for an excess judgment if it fails to settle a claim within policy limits due to bad faith.

• Currently there is no law in Texas providing for post-verdict coverage or protection for insureds after nuclear verdicts (other than the Stowers doctrine).
• During the last legislative session Texas saw some attempts to control the repercussions of nuclear verdicts. However, the proposed legislation focused more on limiting damages (i.e., capping medical expenses, requiring stricter evidence for future damages, mandating unanimous verdicts for non-economic damages) rather than expanding coverage for insureds. (See House Bill 4806 and its companion Senate Bill 30 .) While the legislative efforts stalled, we expect to see more efforts to revisit damage limits during the next legislative session beginning in 2027.
• The Stowers Doctrine is a Texas legal principle that requires a liability insurance company to act in good faith when handling settlement offers within the insured’s policy limits. This case was decided by the Texas Supreme Court in 1929 (G.A. Stowers Furniture Co. v. American Indemnity Co., 15 S.W.2d 544 (Tex. 1929)). Pursuant to the Stower’s Doctrine, if the insurer receives a reasonable settlement demand that is within the policy limits and fails to accept it, then takes the claim to trial and loses with a verdict exceeding those limits, the insurer can be held liable for the entire judgment—even the amount above the policy limits.

Though nuclear verdicts are on the rise, Utah has not officially enacted any legislation that directly impacts the insured’s coverage. Companies are aware of the rise nonetheless, which might eventually lead to legislature changes.

No; Vermont has not enacted any such legislation. However, it should be noted that most venues in Vermont would be considered moderate/conservative on a national scale as regards awarding damages to plaintiffs, with large punitive awards and “runaway juries” being rare in Vermont.

No, Virginia has not enacted any legislation impacting coverage after an insured receives a nuclear verdict.

For more information, please contact:

ALFA International Headquarters
980 N. Michigan Avenue, Suite 1180
Chicago, IL 60611
Phone: (312) 642-2532

For more information, please contact:

ALFA International Headquarters
980 N. Michigan Avenue, Suite 1180
Chicago, IL 60611
Phone: (312) 642-2532

There is no legislation protecting an insured following a nuclear verdict.

No, as there are no reported nuclear verdicts in Wyoming.