diff --git a/server/src/services/native-runtime/native-provider-failure.test.ts b/server/src/services/native-runtime/native-provider-failure.test.ts
index ef1f17e40d4..f8ec77405b4 100644
--- a/server/src/services/native-runtime/native-provider-failure.test.ts
+++ b/server/src/services/native-runtime/native-provider-failure.test.ts
@@ -32,6 +32,22 @@ describe("native provider failure observation", () => {
     expect(observed.providerFailureForTerminal("other-turn", terminal)).toBeNull();
     expect(observed.providerFailureForTerminal("turn", { ...terminal, runTerminalState: "succeeded" })).toBeNull();
   });
+  it.each(["opencode", "codex"])("classifies an action-required model_unavailable failure from %s as a model rejection", kind => {
+    const observed = createNativeProviderFailureObservation({ kind });
+    const providerFailure = { schema: "paperclip.provider-failure.v1", provider: "openrouter", phase: "turn",
+      category: "model_unavailable", message: "vendor/private-model is not a valid model ID", retryability: "requires_action", httpStatus: 400 };
+    observed.observe({ ...event, payload: { status: "failed", error: { providerFailure } } });
+    const result = observed.forTerminal("turn", terminal);
+    expect(result).toMatchObject({ errorCode: "native_provider_model_rejected", errorMessage: NATIVE_MODEL_REJECTION_MESSAGE });
+    expect(JSON.stringify(result)).not.toContain("private-model");
+    expect(observed.forTerminal("other-turn", terminal)).toBeNull();
+    expect(observed.forTerminal("turn", { ...terminal, runTerminalState: "succeeded" })).toBeNull();
+  });
+  it.each(["transient", "unknown"])("does not treat a %s model_unavailable failure as a model rejection", retryability => {
+    const observed = createNativeProviderFailureObservation({ kind: "opencode" });
+    observed.observe({ ...event, payload: { status: "failed", error: { providerFailure: { schema: "paperclip.provider-failure.v1", provider: "openrouter", phase: "turn", category: "model_unavailable", message: "busy", retryability } } } });
+    expect(observed.forTerminal("turn", terminal)).toBeNull();
+  });
   it("surfaces a structured capacity failure without copying arbitrary provider text", () => {
     const observed = createNativeProviderFailureObservation({ kind: "codex" });
     observed.observe({ ...event, payload: { status: "failed", error: { codexErrorInfo: "serverOverloaded", message: "Private arbitrary response" } } });
diff --git a/server/src/services/native-runtime/native-provider-failure.ts b/server/src/services/native-runtime/native-provider-failure.ts
index 71d040566bb..477f61ffba1 100644
--- a/server/src/services/native-runtime/native-provider-failure.ts
+++ b/server/src/services/native-runtime/native-provider-failure.ts
@@ -1,8 +1,9 @@
 import type { PrpEvent, PrpTerminalState } from "../../vendor/paperclip-runner/index.js";
 import { readProviderFailure, type ProviderFailure } from "@paperclipai/shared";
 
+// Shared by every provider whose selected model is rejected, so it names no specific connection.
 export const NATIVE_MODEL_REJECTION_MESSAGE =
-  "The selected model is not supported by the current ChatGPT connection. Choose a supported model or a compatible AI connection.";
+  "The selected model is not available through the current AI connection. Choose a supported model or a compatible AI connection.";
 
 export const NATIVE_PROVIDER_OVERLOADED_MESSAGE =
   "Selected model is at capacity. Please try a different model.";
@@ -266,7 +267,17 @@ export function createNativeProviderFailureObservation(provider: { kind: string;
         errorMessage: NATIVE_PROVIDER_OVERLOADED_MESSAGE,
         diagnostic: { ...NATIVE_PROVIDER_OVERLOADED_DIAGNOSTIC },
       };
-      if (turnId !== rejectedTurnId) return null;
+      if (turnId !== rejectedTurnId) {
+        // A driver's closed category marks a rejected model for any provider. Only an
+        // action-required rejection qualifies; a transient one may succeed on retry.
+        const failure = providerFailures.get(turnId);
+        if (failure?.category !== "model_unavailable" || failure.retryability !== "requires_action") return null;
+        return {
+          errorCode: "native_provider_model_rejected" as const,
+          errorMessage: NATIVE_MODEL_REJECTION_MESSAGE,
+          diagnostic: failedTurns.get(turnId) ?? { provider: failure.provider, category: failure.category },
+        };
+      }
       return {
         errorCode: "native_provider_model_rejected" as const,
         errorMessage: NATIVE_MODEL_REJECTION_MESSAGE,