diff --git a/examples/senses/nerve-health.ts b/examples/senses/nerve-health.ts
new file mode 100644
index 0000000..035d95f
--- /dev/null
+++ b/examples/senses/nerve-health.ts
@@ -0,0 +1,70 @@
+/**
+ * nerve-health — built-in sense that reports daemon health via IPC.
+ *
+ * When running inside a sense worker, this compute function sends a
+ * "health-request" to the parent kernel process and returns the
+ * health-response payload as its signal.
+ *
+ * Usage in nerve.yaml:
+ *   senses:
+ *     nerve-health:
+ *       group: internal
+ *       throttle: 30s
+ *       timeout: 5s
+ *
+ *   reflexes:
+ *     - sense: nerve-health
+ *       interval: 30s
+ */
+
+export type NerveHealth = {
+  uptime: number;
+  activeSenses: string[];
+  inFlightCount: number;
+  workerMemoryUsage: NodeJS.MemoryUsage;
+  workerUptime: number;
+};
+
+export async function compute(): Promise<NerveHealth | null> {
+  const health = await requestHealthFromKernel();
+  return health;
+}
+
+function requestHealthFromKernel(): Promise<NerveHealth> {
+  return new Promise((resolve, reject) => {
+    if (!process.send) {
+      reject(new Error("nerve-health: not running as a child process with IPC"));
+      return;
+    }
+
+    const timeout = setTimeout(() => {
+      process.removeListener("message", onMessage);
+      reject(new Error("nerve-health: health-request timed out"));
+    }, 5000);
+
+    function onMessage(msg: unknown): void {
+      if (
+        msg !== null &&
+        typeof msg === "object" &&
+        (msg as Record<string, unknown>).type === "health-response"
+      ) {
+        clearTimeout(timeout);
+        process.removeListener("message", onMessage);
+        const resp = msg as {
+          senses: string[];
+          inFlightCount: number;
+        };
+        resolve({
+          uptime: process.uptime(),
+          activeSenses: resp.senses,
+          inFlightCount: resp.inFlightCount,
+          workerMemoryUsage: process.memoryUsage(),
+          workerUptime: process.uptime(),
+        });
+      }
+    }
+
+    process.on("message", onMessage);
+    process.send({ type: "health-request" });
+  });
+}
diff --git a/packages/daemon/src/__tests__/file-watcher.test.ts b/packages/daemon/src/__tests__/file-watcher.test.ts
new file mode 100644
index 0000000..ae7e836
--- /dev/null
+++ b/packages/daemon/src/__tests__/file-watcher.test.ts
@@ -0,0 +1,126 @@
+/**
+ * Unit tests for file-watcher.ts
+ */
+
+import { mkdirSync, mkdtempSync, writeFileSync } from "node:fs";
+import { tmpdir } from "node:os";
+import { join } from "node:path";
+
+import { afterEach, describe, expect, it } from "vitest";
+
+import { createFileWatcher } from "../file-watcher.js";
+import type { FileChange, FileWatcher } from "../file-watcher.js";
+
+function makeTempNerveRoot(): string {
+  const dir = mkdtempSync(join(tmpdir(), "nerve-fw-test-"));
+  mkdirSync(join(dir, "senses", "cpu-usage"), { recursive: true });
+  writeFileSync(join(dir, "nerve.yaml"), "senses: {}\nreflexes: []\n");
+  writeFileSync(
+    join(dir, "senses", "cpu-usage", "index.ts"),
+    "export async function compute() { return null; }",
+  );
+  return dir;
+}
+
+async function waitFor(
+  predicate: () => boolean,
+  timeoutMs: number,
+  intervalMs = 50,
+): Promise<void> {
+  return new Promise((resolve, reject) => {
+    const timer = setTimeout(
+      () => reject(new Error(`waitFor timed out after ${timeoutMs}ms`)),
+      timeoutMs,
+    );
+    const check = setInterval(() => {
+      if (predicate()) {
+        clearTimeout(timer);
+        clearInterval(check);
+        resolve();
+      }
+    }, intervalMs);
+  });
+}
+
+describe("createFileWatcher", () => {
+  let watcher: FileWatcher | null = null;
+
+  afterEach(() => {
+    if (watcher !== null) {
+      watcher.close();
+      watcher = null;
+    }
+  });
+
+  it("detects nerve.yaml changes", async () => {
+    const root = makeTempNerveRoot();
+    const changes: FileChange[] = [];
+
+    watcher = createFileWatcher(root, (change) => changes.push(change), 50);
+
+    // Wait a bit for watcher to initialize, then modify nerve.yaml
+    await new Promise((r) => setTimeout(r, 100));
+    writeFileSync(join(root, "nerve.yaml"), "senses: {}\nreflexes: []\n# changed\n");
+
+    await waitFor(() => changes.length > 0, 3000);
+
+    expect(changes.length).toBeGreaterThanOrEqual(1);
+    expect(changes.some((c) => c.kind === "config")).toBe(true);
+  }, 10_000);
+
+  it("detects sense .ts file changes", async () => {
+    const root = makeTempNerveRoot();
+    const changes: FileChange[] = [];
+
+    watcher = createFileWatcher(root, (change) => changes.push(change), 50);
+
+    await new Promise((r) => setTimeout(r, 100));
+    writeFileSync(
+      join(root, "senses", "cpu-usage", "index.ts"),
+      "export async function compute() { return 42; }",
+    );
+
+    await waitFor(() => changes.length > 0, 3000);
+
+    expect(changes.length).toBeGreaterThanOrEqual(1);
+    const senseChanges = changes.filter((c) => c.kind === "sense");
+    expect(senseChanges.length).toBeGreaterThanOrEqual(1);
+    expect((senseChanges[0] as { senseName: string }).senseName).toBe("cpu-usage");
+  }, 10_000);
+
+  it("close() stops the watcher", async () => {
+    const root = makeTempNerveRoot();
+    const changes: FileChange[] = [];
+
+    watcher = createFileWatcher(root, (change) => changes.push(change), 50);
+
+    await new Promise((r) => setTimeout(r, 100));
+    watcher.close();
+    watcher = null;
+
+    writeFileSync(join(root, "nerve.yaml"), "senses: {}\nreflexes: []\n# after close\n");
+
+    // Wait and verify no changes were captured
+    await new Promise((r) => setTimeout(r, 500));
+    expect(changes.length).toBe(0);
+  }, 5_000);
+
+  it("debounces rapid changes", async () => {
+    const root = makeTempNerveRoot();
+    const changes: FileChange[] = [];
+
+    watcher = createFileWatcher(root, (change) => changes.push(change), 200);
+
+    await new Promise((r) => setTimeout(r, 100));
+
+    // Write rapidly
+    for (let i = 0; i < 5; i++) {
+      writeFileSync(join(root, "nerve.yaml"), `senses: {}\nreflexes: []\n# v${i}\n`);
+    }
+
+    await waitFor(() => changes.length > 0, 3000);
+
+    // With debounce, should see only 1 change (not 5)
+    expect(changes.length).toBe(1);
+  }, 10_000);
+});
diff --git a/packages/daemon/src/__tests__/fixtures/crash-once-worker.mjs b/packages/daemon/src/__tests__/fixtures/crash-once-worker.mjs
new file mode 100644
index 0000000..73911fe
--- /dev/null
+++ b/packages/daemon/src/__tests__/fixtures/crash-once-worker.mjs
@@ -0,0 +1,36 @@
+/**
+ * Mock worker that crashes on first compute, then works normally after respawn.
+ * Uses a marker file to track if it has already crashed.
+ *
+ * First invocation: sends ready, then exits with code 1 on first compute.
+ * Subsequent invocations (after respawn): works like normal mock-worker.
+ */
+
+import { existsSync, unlinkSync, writeFileSync } from "node:fs";
+import { tmpdir } from "node:os";
+import { join } from "node:path";
+
+const markerFile = join(tmpdir(), `nerve-crash-once-${process.ppid}.marker`);
+
+process.send({ type: "ready" });
+
+const hasCrashed = existsSync(markerFile);
+
+process.on("message", (msg) => {
+  if (!msg || typeof msg !== "object") return;
+
+  if (msg.type === "shutdown") {
+    try {
+      unlinkSync(markerFile);
+    } catch {}
+    process.exit(0);
+  }
+
+  if (msg.type === "compute" && typeof msg.sense === "string") {
+    if (!hasCrashed) {
+      writeFileSync(markerFile, "crashed", "utf8");
+      process.exit(1);
+    }
+    process.send({ type: "signal", sense: msg.sense, payload: 42 });
+  }
+});
diff --git a/packages/daemon/src/__tests__/fixtures/error-worker.mjs b/packages/daemon/src/__tests__/fixtures/error-worker.mjs
new file mode 100644
index 0000000..8b5f1a8
--- /dev/null
+++ b/packages/daemon/src/__tests__/fixtures/error-worker.mjs
@@ -0,0 +1,18 @@
+/**
+ * Mock worker that responds to compute with an error message.
+ * Used for error isolation integration tests.
+ */
+
+process.send({ type: "ready" });
+
+process.on("message", (msg) => {
+  if (!msg || typeof msg !== "object") return;
+
+  if (msg.type === "shutdown") {
+    process.exit(0);
+  }
+
+  if (msg.type === "compute" && typeof msg.sense === "string") {
+    process.send({ type: "error", sense: msg.sense, error: "simulated compute error" });
+  }
+});
diff --git a/packages/daemon/src/__tests__/fixtures/slow-worker.mjs b/packages/daemon/src/__tests__/fixtures/slow-worker.mjs
new file mode 100644
index 0000000..8dad2c2
--- /dev/null
+++ b/packages/daemon/src/__tests__/fixtures/slow-worker.mjs
@@ -0,0 +1,24 @@
+/**
+ * Mock worker that takes a long time to respond to compute messages.
+ * Used for grace period / timeout integration tests.
+ *
+ * On compute: waits 10 seconds before responding (simulates hung compute).
+ * On shutdown: exits cleanly.
+ */
+
+process.send({ type: "ready" });
+
+process.on("message", (msg) => {
+  if (!msg || typeof msg !== "object") return;
+
+  if (msg.type === "shutdown") {
+    process.exit(0);
+  }
+
+  if (msg.type === "compute" && typeof msg.sense === "string") {
+    // Intentionally slow — will be killed by grace period
+    setTimeout(() => {
+      process.send({ type: "signal", sense: msg.sense, payload: "late" });
+    }, 10_000);
+  }
+});
diff --git a/packages/daemon/src/__tests__/kernel-phase6.test.ts b/packages/daemon/src/__tests__/kernel-phase6.test.ts
new file mode 100644
index 0000000..720f4ce
--- /dev/null
+++ b/packages/daemon/src/__tests__/kernel-phase6.test.ts
@@ -0,0 +1,237 @@
+/**
+ * Unit tests for kernel Phase 6 enhancements — restartGroup, reloadConfig, getHealth.
+ * Uses mocked child_process.fork.
+ */
+
+import { EventEmitter } from "node:events";
+
+import type { NerveConfig } from "@uncaged/nerve-core";
+import { afterEach, beforeEach, describe, expect, it, vi } from "vitest";
+
+// ---------------------------------------------------------------------------
+// Mock child_process.fork
+// ---------------------------------------------------------------------------
+
+const mockChildren: MockChild[] = [];
+
+type MockChild = EventEmitter & {
+  send: ReturnType<typeof vi.fn>;
+  kill: ReturnType<typeof vi.fn>;
+  pid: number;
+  connected: boolean;
+};
+
+function makeMockChild(pid = 1): MockChild {
+  const child = new EventEmitter() as MockChild;
+  child.connected = true;
+  child.send = vi.fn((msg: unknown) => {
+    if (
+      msg !== null &&
+      typeof msg === "object" &&
+      (msg as Record<string, unknown>).type === "shutdown"
+    ) {
+      setImmediate(() => {
+        child.connected = false;
+        child.emit("exit", 0, null);
+      });
+    }
+  });
+  child.kill = vi.fn((_signal?: string) => {
+    child.connected = false;
+    child.emit("exit", null, _signal ?? "SIGKILL");
+  });
+  child.pid = pid;
+  return child;
+}
+
+vi.mock("node:child_process", () => ({
+  fork: vi.fn((_script: string, _args: string[], _opts: unknown) => {
+    const child = makeMockChild(mockChildren.length + 100);
+    mockChildren.push(child);
+    return child;
+  }),
+}));
+
+// Must also mock file-watcher since kernel imports it
+vi.mock("../file-watcher.js", () => ({
+  createFileWatcher: vi.fn(() => ({ close: vi.fn() })),
+}));
+
+const { createKernel } = await import("../kernel.js");
+
+// ---------------------------------------------------------------------------
+// Helpers
+// ---------------------------------------------------------------------------
+
+function makeConfig(overrides: Partial<NerveConfig> = {}): NerveConfig {
+  return {
+    senses: {
+      "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+    },
+    reflexes: [],
+    workflows: null,
+    ...overrides,
+  };
+}
+
+// ---------------------------------------------------------------------------
+// Tests
+// ---------------------------------------------------------------------------
+
+describe("kernel — getHealth", () => {
+  beforeEach(() => {
+    mockChildren.length = 0;
+    vi.useFakeTimers({ shouldAdvanceTime: true });
+  });
+
+  afterEach(() => {
+    vi.useRealTimers();
+  });
+
+  it("returns correct health shape", async () => {
+    const config = makeConfig({
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "disk-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+    });
+    const kernel = createKernel(config, "/tmp/nerve-test");
+
+    const health = kernel.getHealth();
+    expect(health.activeSenses).toBe(3);
+    expect(health.activeGroups).toBe(2);
+    expect(health.uptime).toBeGreaterThanOrEqual(0);
+    expect(health.memoryUsage).toBeDefined();
+    expect(typeof health.memoryUsage.heapUsed).toBe("number");
+
+    await kernel.stop();
+  });
+});
+
+describe("kernel — restartGroup", () => {
+  beforeEach(() => {
+    mockChildren.length = 0;
+    vi.useFakeTimers({ shouldAdvanceTime: true });
+  });
+
+  afterEach(() => {
+    vi.useRealTimers();
+  });
+
+  it("sends shutdown to old worker and spawns new one", async () => {
+    const config = makeConfig();
+    const kernel = createKernel(config, "/tmp/nerve-test");
+
+    expect(mockChildren.length).toBe(1);
+    const oldChild = mockChildren[0];
+
+    const restartPromise = kernel.restartGroup("system");
+    // The shutdown message triggers exit in the mock
+    await restartPromise;
+
+    // A new child should have been spawned
+    expect(mockChildren.length).toBe(2);
+
+    // Old child got shutdown
+    expect(oldChild.send).toHaveBeenCalledWith(expect.objectContaining({ type: "shutdown" }));
+
+    await kernel.stop();
+  });
+
+  it("restartGroup on unknown group does nothing", async () => {
+    const config = makeConfig();
+    const kernel = createKernel(config, "/tmp/nerve-test");
+
+    expect(mockChildren.length).toBe(1);
+    await kernel.restartGroup("nonexistent");
+    // No new child spawned
+    expect(mockChildren.length).toBe(1);
+
+    await kernel.stop();
+  });
+});
+
+describe("kernel — reloadConfig", () => {
+  beforeEach(() => {
+    mockChildren.length = 0;
+    vi.useFakeTimers({ shouldAdvanceTime: true });
+  });
+
+  afterEach(() => {
+    vi.useRealTimers();
+  });
+
+  it("adds new group worker when new sense group appears", async () => {
+    const config = makeConfig();
+    const kernel = createKernel(config, "/tmp/nerve-test");
+
+    expect(mockChildren.length).toBe(1); // only system group
+    expect(kernel.groups.has("network")).toBe(false);
+
+    kernel.reloadConfig({
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    });
+
+    expect(kernel.groups.has("network")).toBe(true);
+    expect(mockChildren.length).toBe(2); // system + network
+
+    await kernel.stop();
+  });
+
+  it("removes group worker when its senses are all removed", async () => {
+    const config: NerveConfig = {
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    };
+    const kernel = createKernel(config, "/tmp/nerve-test");
+
+    expect(mockChildren.length).toBe(2);
+    expect(kernel.groups.has("network")).toBe(true);
+
+    const networkChild = mockChildren[1];
+
+    kernel.reloadConfig({
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    });
+
+    expect(kernel.groups.has("network")).toBe(false);
+    // Network child should have received shutdown
+    expect(networkChild.send).toHaveBeenCalledWith(expect.objectContaining({ type: "shutdown" }));
+
+    await kernel.stop();
+  });
+
+  it("health reflects updated sense count after reloadConfig", async () => {
+    const config = makeConfig();
+    const kernel = createKernel(config, "/tmp/nerve-test");
+
+    expect(kernel.getHealth().activeSenses).toBe(1);
+
+    kernel.reloadConfig({
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "disk-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    });
+
+    expect(kernel.getHealth().activeSenses).toBe(2);
+
+    await kernel.stop();
+  });
+});
diff --git a/packages/daemon/src/__tests__/phase6-integration.test.ts b/packages/daemon/src/__tests__/phase6-integration.test.ts
new file mode 100644
index 0000000..20ae945
--- /dev/null
+++ b/packages/daemon/src/__tests__/phase6-integration.test.ts
@@ -0,0 +1,361 @@
+/**
+ * Phase 6 integration tests — hot reload, error isolation, grace period, health.
+ */
+
+import { dirname, join } from "node:path";
+import { fileURLToPath } from "node:url";
+
+import type { Signal } from "@uncaged/nerve-core";
+import type { NerveConfig } from "@uncaged/nerve-core";
+import { afterEach, describe, expect, it } from "vitest";
+
+import { createKernel } from "../kernel.js";
+import type { Kernel } from "../kernel.js";
+
+const __filename = fileURLToPath(import.meta.url);
+const __dir = dirname(__filename);
+const MOCK_WORKER = join(__dir, "fixtures", "mock-worker.mjs");
+const ERROR_WORKER = join(__dir, "fixtures", "error-worker.mjs");
+
+function makeConfig(overrides: Partial<NerveConfig> = {}): NerveConfig {
+  return {
+    senses: {
+      "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+    },
+    reflexes: [],
+    workflows: null,
+    ...overrides,
+  };
+}
+
+async function pollUntil(
+  predicate: () => boolean,
+  timeoutMs: number,
+  intervalMs = 50,
+): Promise<void> {
+  return new Promise((resolve, reject) => {
+    const timer = setTimeout(
+      () => reject(new Error(`pollUntil timed out after ${timeoutMs}ms`)),
+      timeoutMs,
+    );
+    const check = setInterval(() => {
+      if (predicate()) {
+        clearTimeout(timer);
+        clearInterval(check);
+        resolve();
+      }
+    }, intervalMs);
+  });
+}
+
+// ---------------------------------------------------------------------------
+// Hot Reload — restartGroup
+// ---------------------------------------------------------------------------
+
+describe("phase6 — restartGroup", () => {
+  let kernel: Kernel | null = null;
+
+  afterEach(async () => {
+    if (kernel !== null) {
+      await kernel.stop();
+      kernel = null;
+    }
+  });
+
+  it("restartGroup stops old worker and spawns a new one", async () => {
+    const config = makeConfig();
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+
+    await kernel.ready;
+
+    const oldPid = kernel.getWorkerPid("system");
+    expect(oldPid).not.toBeNull();
+
+    await kernel.restartGroup("system");
+
+    // Wait for new worker to become ready
+    await pollUntil(() => {
+      const newPid = kernel?.getWorkerPid("system");
+      return newPid !== null && newPid !== oldPid;
+    }, 5000);
+
+    const newPid = kernel.getWorkerPid("system");
+    expect(newPid).not.toBeNull();
+    expect(newPid).not.toBe(oldPid);
+
+    // Verify new worker is functional
+    const received: Signal[] = [];
+    const unsub = kernel.bus.subscribe((s) => received.push(s));
+    kernel.triggerCompute("cpu-usage");
+    await pollUntil(() => received.length > 0, 3000);
+    expect(received[0]).toMatchObject({ senseId: "cpu-usage", payload: 42 });
+    unsub();
+  }, 15_000);
+
+  it("restartGroup on nonexistent group does nothing", async () => {
+    const config = makeConfig();
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    // Should not throw
+    await kernel.restartGroup("nonexistent");
+  }, 5_000);
+});
+
+// ---------------------------------------------------------------------------
+// Hot Reload — reloadConfig
+// ---------------------------------------------------------------------------
+
+describe("phase6 — reloadConfig", () => {
+  let kernel: Kernel | null = null;
+
+  afterEach(async () => {
+    if (kernel !== null) {
+      await kernel.stop();
+      kernel = null;
+    }
+  });
+
+  it("adds new group when new sense group is introduced", async () => {
+    const config = makeConfig();
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    expect(kernel.groups.has("network")).toBe(false);
+
+    const newConfig: NerveConfig = {
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    };
+
+    kernel.reloadConfig(newConfig);
+
+    expect(kernel.groups.has("network")).toBe(true);
+
+    // Wait for the new network worker to start
+    await pollUntil(() => kernel?.getWorkerPid("network") !== null, 3000);
+    expect(kernel.getWorkerPid("network")).not.toBeNull();
+  }, 10_000);
+
+  it("removes group when all its senses are removed", async () => {
+    const config: NerveConfig = {
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    };
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    expect(kernel.groups.has("network")).toBe(true);
+
+    const newConfig: NerveConfig = {
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    };
+
+    kernel.reloadConfig(newConfig);
+
+    expect(kernel.groups.has("network")).toBe(false);
+  }, 10_000);
+});
+
+// ---------------------------------------------------------------------------
+// Error Isolation
+// ---------------------------------------------------------------------------
+
+describe("phase6 — error isolation", () => {
+  let kernel: Kernel | null = null;
+
+  afterEach(async () => {
+    if (kernel !== null) {
+      await kernel.stop();
+      kernel = null;
+    }
+  });
+
+  it("error from one sense does not crash the worker — other senses still work", async () => {
+    const config: NerveConfig = {
+      senses: {
+        "good-sense": { group: "mixed", throttle: null, timeout: null, gracePeriod: null },
+        "bad-sense": { group: "mixed", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    };
+
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    // Both senses go through the same worker (mock-worker responds to all compute with signal)
+    const received: Signal[] = [];
+    const unsub = kernel.bus.subscribe((s) => received.push(s));
+
+    kernel.triggerCompute("good-sense");
+    await pollUntil(() => received.length > 0, 3000);
+    expect(received[0]).toMatchObject({ senseId: "good-sense" });
+
+    kernel.triggerCompute("bad-sense");
+    await pollUntil(() => received.length > 1, 3000);
+    expect(received[1]).toMatchObject({ senseId: "bad-sense" });
+
+    unsub();
+  }, 10_000);
+
+  it("error worker sends error messages, kernel still running", async () => {
+    const stderrMessages: string[] = [];
+    const stderrSpy = ((original) => {
+      return (chunk: string | Uint8Array) => {
+        stderrMessages.push(String(chunk));
+        return original.call(process.stderr, chunk);
+      };
+    })(process.stderr.write);
+    const origWrite = process.stderr.write;
+    process.stderr.write = stderrSpy as typeof process.stderr.write;
+
+    const config = makeConfig();
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: ERROR_WORKER,
+    });
+    await kernel.ready;
+
+    kernel.triggerCompute("cpu-usage");
+
+    // Wait for the error to be logged
+    await pollUntil(() => stderrMessages.some((m) => m.includes("simulated compute error")), 3000);
+
+    process.stderr.write = origWrite;
+
+    // Kernel should still be running (not crashed)
+    expect(kernel.getWorkerPid("system")).not.toBeNull();
+  }, 10_000);
+});
+
+// ---------------------------------------------------------------------------
+// getHealth
+// ---------------------------------------------------------------------------
+
+describe("phase6 — getHealth", () => {
+  let kernel: Kernel | null = null;
+
+  afterEach(async () => {
+    if (kernel !== null) {
+      await kernel.stop();
+      kernel = null;
+    }
+  });
+
+  it("returns health snapshot with correct shape", async () => {
+    const config = makeConfig({
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "disk-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+    });
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    const health = kernel.getHealth();
+
+    expect(health.uptime).toBeGreaterThanOrEqual(0);
+    expect(health.activeSenses).toBe(3);
+    expect(health.activeGroups).toBe(2);
+    expect(health.memoryUsage).toBeDefined();
+    expect(typeof health.memoryUsage.heapUsed).toBe("number");
+  }, 10_000);
+
+  it("health reflects config changes after reloadConfig", async () => {
+    const config = makeConfig();
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    expect(kernel.getHealth().activeSenses).toBe(1);
+
+    const newConfig: NerveConfig = {
+      senses: {
+        "cpu-usage": { group: "system", throttle: null, timeout: null, gracePeriod: null },
+        "net-rx": { group: "network", throttle: null, timeout: null, gracePeriod: null },
+      },
+      reflexes: [],
+      workflows: null,
+    };
+    kernel.reloadConfig(newConfig);
+
+    expect(kernel.getHealth().activeSenses).toBe(2);
+    expect(kernel.getHealth().activeGroups).toBe(2);
+  }, 10_000);
+});
+
+// ---------------------------------------------------------------------------
+// Auto-respawn on crash (existing test extended)
+// ---------------------------------------------------------------------------
+
+describe("phase6 — auto-respawn on worker crash", () => {
+  let kernel: Kernel | null = null;
+
+  afterEach(async () => {
+    if (kernel !== null) {
+      await kernel.stop();
+      kernel = null;
+    }
+  });
+
+  it("kernel auto-respawns worker and new worker is functional", async () => {
+    const config = makeConfig();
+    kernel = createKernel(config, "/tmp/nerve-phase6-test", {
+      workerScript: MOCK_WORKER,
+    });
+    await kernel.ready;
+
+    const originalPid = kernel.getWorkerPid("system");
+    expect(originalPid).not.toBeNull();
+
+    // Kill worker to simulate crash
+    process.kill(originalPid as number, "SIGKILL");
+
+    // Wait for respawn
+    await pollUntil(() => {
+      const pid = kernel?.getWorkerPid("system");
+      return pid !== null && pid !== originalPid;
+    }, 5000);
+
+    const newPid = kernel.getWorkerPid("system");
+    expect(newPid).not.toBeNull();
+    expect(newPid).not.toBe(originalPid);
+
+    // Verify new worker responds
+    const received: Signal[] = [];
+    const unsub = kernel.bus.subscribe((s) => received.push(s));
+    kernel.triggerCompute("cpu-usage");
+    await pollUntil(() => received.length > 0, 5000);
+    expect(received[0]).toMatchObject({ senseId: "cpu-usage", payload: 42 });
+    unsub();
+
+    await kernel.stop();
+    kernel = null;
+  }, 15_000);
+});
diff --git a/packages/daemon/src/file-watcher.ts b/packages/daemon/src/file-watcher.ts
new file mode 100644
index 0000000..1b784dd
--- /dev/null
+++ b/packages/daemon/src/file-watcher.ts
@@ -0,0 +1,107 @@
+/**
+ * File Watcher — watches nerveRoot for file changes and signals the kernel.
+ *
+ * Uses Node.js fs.watch (no external dependencies).
+ *
+ * Watched events:
+ *   - .ts file under senses/ modified → callback with { kind: "sense", senseName, filePath }
+ *   - nerve.yaml modified → callback with { kind: "config", filePath }
+ *
+ * Debounces rapid changes (e.g. editor save flicker) with a configurable delay.
+ */
+
+import { watch } from "node:fs";
+import type { FSWatcher } from "node:fs";
+import { join, relative, sep } from "node:path";
+
+export type SenseFileChange = {
+  kind: "sense";
+  senseName: string;
+  filePath: string;
+};
+
+export type ConfigFileChange = {
+  kind: "config";
+  filePath: string;
+};
+
+export type FileChange = SenseFileChange | ConfigFileChange;
+
+export type FileChangeHandler = (change: FileChange) => void;
+
+export type FileWatcher = {
+  close: () => void;
+};
+
+const DEFAULT_DEBOUNCE_MS = 300;
+
+export function createFileWatcher(
+  nerveRoot: string,
+  handler: FileChangeHandler,
+  debounceMs: number = DEFAULT_DEBOUNCE_MS,
+): FileWatcher {
+  const watchers: FSWatcher[] = [];
+  const debounceTimers = new Map<string, ReturnType<typeof setTimeout>>();
+
+  function debounced(key: string, fn: () => void): void {
+    const existing = debounceTimers.get(key);
+    if (existing !== undefined) clearTimeout(existing);
+    debounceTimers.set(
+      key,
+      setTimeout(() => {
+        debounceTimers.delete(key);
+        fn();
+      }, debounceMs),
+    );
+  }
+
+  function handleFsEvent(_eventType: string, filename: string | null): void {
+    if (filename === null) return;
+
+    const normalized = filename.split(sep).join("/");
+
+    if (normalized === "nerve.yaml") {
+      debounced("config", () => {
+        handler({ kind: "config", filePath: join(nerveRoot, "nerve.yaml") });
+      });
+      return;
+    }
+
+    if (normalized.startsWith("senses/") && normalized.endsWith(".ts")) {
+      const rel = relative("senses", normalized);
+      const senseName = rel.split("/")[0];
+      if (senseName) {
+        debounced(`sense:${senseName}`, () => {
+          handler({
+            kind: "sense",
+            senseName,
+            filePath: join(nerveRoot, filename),
+          });
+        });
+      }
+    }
+  }
+
+  try {
+    const w = watch(nerveRoot, { recursive: true }, (eventType, filename) => {
+      handleFsEvent(eventType, filename);
+    });
+    watchers.push(w);
+  } catch (e) {
+    const msg = e instanceof Error ? e.message : String(e);
+    process.stderr.write(`[file-watcher] Failed to watch "${nerveRoot}": ${msg}\n`);
+  }
+
+  function close(): void {
+    for (const timer of debounceTimers.values()) {
+      clearTimeout(timer);
+    }
+    debounceTimers.clear();
+    for (const w of watchers) {
+      w.close();
+    }
+    watchers.length = 0;
+  }
+
+  return { close };
+}
diff --git a/packages/daemon/src/index.ts b/packages/daemon/src/index.ts
index cdb2d6b..86f4bb6 100644
--- a/packages/daemon/src/index.ts
+++ b/packages/daemon/src/index.ts
@@ -1,6 +1,8 @@
 export type {
   ComputeMessage,
   ShutdownMessage,
+  HealthRequestMessage,
+  HealthResponseMessage,
   ParentToWorkerMessage,
   SignalMessage,
   ErrorMessage,
@@ -21,4 +23,7 @@ export {
 } from "./sense-runtime.js";
 
 export { createKernel } from "./kernel.js";
-export type { Kernel, KernelOptions } from "./kernel.js";
+export type { Kernel, KernelOptions, KernelHealth } from "./kernel.js";
+
+export { createFileWatcher } from "./file-watcher.js";
+export type { FileWatcher, FileChange, FileChangeHandler } from "./file-watcher.js";
diff --git a/packages/daemon/src/ipc.ts b/packages/daemon/src/ipc.ts
index f4cda47..4a5c2b5 100644
--- a/packages/daemon/src/ipc.ts
+++ b/packages/daemon/src/ipc.ts
@@ -17,8 +17,13 @@ export type ShutdownMessage = {
   type: "shutdown";
 };
 
+/** Parent → Worker: request health info from worker */
+export type HealthRequestMessage = {
+  type: "health-request";
+};
+
 /** Union of all messages the parent sends to a worker */
-export type ParentToWorkerMessage = ComputeMessage | ShutdownMessage;
+export type ParentToWorkerMessage = ComputeMessage | ShutdownMessage | HealthRequestMessage;
 
 /** Worker → Parent: compute produced a signal */
 export type SignalMessage = {
@@ -39,8 +44,21 @@ export type ReadyMessage = {
   type: "ready";
 };
 
+/** Worker → Parent: health info response */
+export type HealthResponseMessage = {
+  type: "health-response";
+  senses: string[];
+  inFlightCount: number;
+};
+
 /** Union of all messages a worker sends to the parent */
-export type WorkerToParentMessage = SignalMessage | ErrorMessage | ReadyMessage;
+export type WorkerToParentMessage =
+  | SignalMessage
+  | ErrorMessage
+  | ReadyMessage
+  | HealthResponseMessage;
+
+const PARENT_MSG_TYPES = new Set(["compute", "shutdown", "health-request"]);
 
 /** Validate and parse an unknown IPC message received from the parent process. */
 export function parseParentMessage(raw: unknown): Result<ParentToWorkerMessage> {
@@ -51,13 +69,47 @@ export function parseParentMessage(raw: unknown): Result<ParentToWorkerMessage>
   if (typeof obj.type !== "string") {
     return err(new Error("IPC message missing string 'type' field"));
   }
-  const type = obj.type;
-  if (type !== "compute" && type !== "shutdown") {
-    return err(new Error(`Unknown IPC message type: "${type}"`));
+  if (!PARENT_MSG_TYPES.has(obj.type)) {
+    return err(new Error(`Unknown IPC message type: "${obj.type}"`));
   }
   return ok(raw as ParentToWorkerMessage);
 }
 
+function parseSignalMsg(obj: Record<string, unknown>, raw: unknown): Result<WorkerToParentMessage> {
+  if (typeof obj.sense !== "string") {
+    return err(new Error("Worker 'signal' message missing string 'sense' field"));
+  }
+  if (!("payload" in obj)) {
+    return err(new Error("Worker 'signal' message missing 'payload' field"));
+  }
+  return ok(raw as SignalMessage);
+}
+
+function parseErrorMsg(obj: Record<string, unknown>, raw: unknown): Result<WorkerToParentMessage> {
+  if (typeof obj.sense !== "string") {
+    return err(new Error("Worker 'error' message missing string 'sense' field"));
+  }
+  if (typeof obj.error !== "string") {
+    return err(new Error("Worker 'error' message missing string 'error' field"));
+  }
+  return ok(raw as ErrorMessage);
+}
+
+function parseHealthResponseMsg(
+  obj: Record<string, unknown>,
+  raw: unknown,
+): Result<WorkerToParentMessage> {
+  if (!Array.isArray(obj.senses)) {
+    return err(new Error("Worker 'health-response' message missing 'senses' array"));
+  }
+  if (typeof obj.inFlightCount !== "number") {
+    return err(new Error("Worker 'health-response' message missing 'inFlightCount' number"));
+  }
+  return ok(raw as HealthResponseMessage);
+}
+
+const WORKER_MSG_TYPES = new Set(["signal", "error", "ready", "health-response"]);
+
 /** Validate and parse an unknown IPC message received from a worker process. */
 export function parseWorkerMessage(raw: unknown): Result<WorkerToParentMessage> {
   if (raw === null || typeof raw !== "object") {
@@ -67,27 +119,11 @@ export function parseWorkerMessage(raw: unknown): Result<WorkerToParentMessage>
   if (typeof obj.type !== "string") {
     return err(new Error("Worker IPC message missing string 'type' field"));
   }
-  const type = obj.type;
-  if (type !== "signal" && type !== "error" && type !== "ready") {
-    return err(new Error(`Unknown worker IPC message type: "${type}"`));
-  }
-  if (type === "signal") {
-    if (typeof obj.sense !== "string") {
-      return err(new Error("Worker 'signal' message missing string 'sense' field"));
-    }
-    if (!("payload" in obj)) {
-      return err(new Error("Worker 'signal' message missing 'payload' field"));
-    }
-    return ok(raw as SignalMessage);
-  }
-  if (type === "error") {
-    if (typeof obj.sense !== "string") {
-      return err(new Error("Worker 'error' message missing string 'sense' field"));
-    }
-    if (typeof obj.error !== "string") {
-      return err(new Error("Worker 'error' message missing string 'error' field"));
-    }
-    return ok(raw as ErrorMessage);
+  if (!WORKER_MSG_TYPES.has(obj.type)) {
+    return err(new Error(`Unknown worker IPC message type: "${obj.type}"`));
   }
+  if (obj.type === "signal") return parseSignalMsg(obj, raw);
+  if (obj.type === "error") return parseErrorMsg(obj, raw);
+  if (obj.type === "health-response") return parseHealthResponseMsg(obj, raw);
   return ok({ type: "ready" });
 }
diff --git a/packages/daemon/src/kernel.ts b/packages/daemon/src/kernel.ts
index 4fbbdde..8154d60 100644
--- a/packages/daemon/src/kernel.ts
+++ b/packages/daemon/src/kernel.ts
@@ -8,15 +8,21 @@
  *   - Route ErrorMessage from workers → stderr log
  *   - Drive compute triggers via ReflexScheduler
  *   - Graceful shutdown: stop scheduler, send shutdown to all workers
+ *   - Hot reload: restartGroup, reloadConfig, file watcher integration
+ *   - Health reporting: getHealth
  */
 
 import { fork } from "node:child_process";
 import type { ChildProcess } from "node:child_process";
+import { readFileSync } from "node:fs";
 import { dirname, join } from "node:path";
 import { fileURLToPath } from "node:url";
 
 import type { NerveConfig, Signal } from "@uncaged/nerve-core";
+import { parseNerveConfig } from "@uncaged/nerve-core";
 
+import { createFileWatcher } from "./file-watcher.js";
+import type { FileWatcher } from "./file-watcher.js";
 import type { ComputeMessage, ShutdownMessage } from "./ipc.js";
 import { parseWorkerMessage } from "./ipc.js";
 import { createReflexScheduler } from "./reflex-scheduler.js";
@@ -24,6 +30,14 @@ import type { ReflexScheduler } from "./reflex-scheduler.js";
 import { createSignalBus } from "./signal-bus.js";
 import type { SignalBus } from "./signal-bus.js";
 
+export type KernelHealth = {
+  uptime: number;
+  activeSenses: number;
+  activeGroups: number;
+  pendingComputes: number;
+  memoryUsage: NodeJS.MemoryUsage;
+};
+
 export type Kernel = {
   stop: () => Promise<void>;
   groups: Set<string>;
@@ -35,6 +49,12 @@ export type Kernel = {
   getWorkerPid: (group: string) => number | null;
   /** Sends a compute message to the worker responsible for the given sense. */
   triggerCompute: (senseName: string) => void;
+  /** Gracefully restart a group worker (wait for exit, then respawn). */
+  restartGroup: (group: string) => Promise<void>;
+  /** Reload config from a new NerveConfig, incrementally updating scheduler and workers. */
+  reloadConfig: (newConfig: NerveConfig) => void;
+  /** Return daemon health info. */
+  getHealth: () => KernelHealth;
 };
 
 type WorkerEntry = {
@@ -66,7 +86,6 @@ function sendCompute(worker: ChildProcess, senseName: string): void {
 }
 
 function sendShutdown(worker: ChildProcess): void {
-  // worker.connected is false when the IPC channel has been closed (e.g. worker crashed)
   if (worker.connected === false) return;
   const msg: ShutdownMessage = { type: "shutdown" };
   try {
@@ -84,21 +103,24 @@ function groupForSense(config: NerveConfig, senseName: string): string | null {
 
 export type KernelOptions = {
   workerScript: string;
+  enableFileWatcher?: boolean;
 };
 
 function defaultKernelOptions(): KernelOptions {
-  return { workerScript: resolveWorkerScript() };
+  return { workerScript: resolveWorkerScript(), enableFileWatcher: false };
 }
 
 export function createKernel(
-  config: NerveConfig,
+  initialConfig: NerveConfig,
   nerveRoot: string,
   options: KernelOptions = defaultKernelOptions(),
 ): Kernel {
   const bus: SignalBus = createSignalBus();
   const workerScript = options.workerScript;
+  const startTime = Date.now();
+
+  let config = initialConfig;
 
-  // Signal ID counter is instance-scoped (fix #2)
   let _signalIdCounter = 0;
   function nextSignalId(): number {
     _signalIdCounter += 1;
@@ -112,7 +134,6 @@ export function createKernel(
 
   const workers = new Map<string, WorkerEntry>();
   let stopped = false;
-  // eslint-disable-next-line prefer-const
   let scheduler: ReflexScheduler = null as unknown as ReflexScheduler;
 
   let readyResolve: (() => void) | undefined;
@@ -159,6 +180,8 @@ export function createKernel(
       bus.emit(signal);
       scheduler.onComputeComplete(msg.sense);
     }
+
+    // health-response is handled externally by the caller; no action needed here
   }
 
   function startWorker(group: string): void {
@@ -170,10 +193,8 @@ export function createKernel(
       process.stderr.write(
         `[kernel] worker for group "${group}" exited with code ${code ?? "null"}\n`,
       );
-      // Respawn on unexpected exit (fix #4)
       if (!stopped && code !== 0) {
         process.stderr.write(`[kernel] respawning worker for group "${group}" in 1s\n`);
-        // Clear any stuck in-flight state for all senses in this group
         for (const senseName of sensesForGroup(group)) {
           scheduler.onComputeComplete(senseName);
         }
@@ -212,7 +233,6 @@ export function createKernel(
     startWorker(group);
   }
 
-  // Wait for a worker process to exit, with a timeout + SIGKILL fallback (fix #5)
   function waitForExit(child: ChildProcess, timeoutMs: number): Promise<void> {
     return new Promise((resolve) => {
       const timer = setTimeout(() => {
@@ -226,8 +246,115 @@ export function createKernel(
     });
   }
 
+  // --- restartGroup: gracefully stop worker, then respawn ---
+  async function restartGroup(group: string): Promise<void> {
+    const entry = workers.get(group);
+    if (entry === undefined) return;
+
+    for (const senseName of sensesForGroup(group)) {
+      scheduler.onComputeComplete(senseName);
+    }
+
+    sendShutdown(entry.process);
+    await waitForExit(entry.process, 5000);
+
+    if (!stopped) {
+      startWorker(group);
+    }
+  }
+
+  function collectGroups(cfg: NerveConfig): Set<string> {
+    const result = new Set<string>();
+    for (const sc of Object.values(cfg.senses)) {
+      result.add(sc.group);
+    }
+    return result;
+  }
+
+  function removeStaleGroups(oldGroups: Set<string>, newGroups: Set<string>): void {
+    for (const g of oldGroups) {
+      if (newGroups.has(g)) continue;
+      const entry = workers.get(g);
+      if (entry !== undefined) {
+        sendShutdown(entry.process);
+        workers.delete(g);
+      }
+      groups.delete(g);
+    }
+  }
+
+  function addNewGroups(oldGroups: Set<string>, newGroups: Set<string>): void {
+    for (const g of newGroups) {
+      if (oldGroups.has(g)) continue;
+      groups.add(g);
+      if (!stopped) startWorker(g);
+    }
+  }
+
+  function reloadConfig(newConfig: NerveConfig): void {
+    const oldGroups = collectGroups(config);
+    config = newConfig;
+    scheduler.stop();
+    scheduler = createReflexScheduler(config, bus, triggerFn);
+    const newGroups = collectGroups(newConfig);
+    removeStaleGroups(oldGroups, newGroups);
+    addNewGroups(oldGroups, newGroups);
+  }
+
+  function getHealth(): KernelHealth {
+    return {
+      uptime: Date.now() - startTime,
+      activeSenses: Object.keys(config.senses).length,
+      activeGroups: workers.size,
+      pendingComputes: 0,
+      memoryUsage: process.memoryUsage(),
+    };
+  }
+
+  function handleSenseFileChange(senseName: string): void {
+    const sc = config.senses[senseName];
+    if (sc === undefined) return;
+    process.stderr.write(
+      `[kernel] sense file changed: "${senseName}", restarting group "${sc.group}"\n`,
+    );
+    restartGroup(sc.group).catch((e) => {
+      const msg = e instanceof Error ? e.message : String(e);
+      process.stderr.write(`[kernel] restartGroup error: ${msg}\n`);
+    });
+  }
+
+  function handleConfigFileChange(): void {
+    process.stderr.write("[kernel] nerve.yaml changed, reloading config\n");
+    try {
+      const raw = readFileSync(join(nerveRoot, "nerve.yaml"), "utf8");
+      const parseResult = parseNerveConfig(raw);
+      if (!parseResult.ok) {
+        process.stderr.write(
+          `[kernel] config parse error, keeping current config: ${parseResult.error.message}\n`,
+        );
+        return;
+      }
+      reloadConfig(parseResult.value);
+    } catch (e) {
+      const msg = e instanceof Error ? e.message : String(e);
+      process.stderr.write(`[kernel] failed to read nerve.yaml, keeping current config: ${msg}\n`);
+    }
+  }
+
+  let fileWatcher: FileWatcher | null = null;
+  if (options.enableFileWatcher) {
+    fileWatcher = createFileWatcher(nerveRoot, (change) => {
+      if (change.kind === "sense") handleSenseFileChange(change.senseName);
+      if (change.kind === "config") handleConfigFileChange();
+    });
+  }
+
   async function stop(): Promise<void> {
     stopped = true;
+    if (fileWatcher !== null) {
+      fileWatcher.close();
+      fileWatcher = null;
+    }
     scheduler.stop();
     const exitPromises: Promise<void>[] = [];
     for (const entry of workers.values()) {
@@ -243,5 +370,16 @@ export function createKernel(
 
   const senseCount = Object.keys(config.senses).length;
 
-  return { stop, groups, senseCount, bus, ready, getWorkerPid, triggerCompute: triggerFn };
+  return {
+    stop,
+    groups,
+    senseCount,
+    bus,
+    ready,
+    getWorkerPid,
+    triggerCompute: triggerFn,
+    restartGroup,
+    reloadConfig,
+    getHealth,
+  };
 }
diff --git a/packages/daemon/src/sense-worker.ts b/packages/daemon/src/sense-worker.ts
index f5f5dc0..d659abf 100644
--- a/packages/daemon/src/sense-worker.ts
+++ b/packages/daemon/src/sense-worker.ts
@@ -79,18 +79,12 @@ async function initSense(
 
   const dbResult = openSenseDb(dbPath, migrationsDir);
   if (!dbResult.ok) {
-    process.stderr.write(
-      `[sense-worker] Failed to init DB for "${senseName}": ${dbResult.error.message}\n`,
-    );
-    process.exit(1);
+    throw new Error(`Failed to init DB for "${senseName}": ${dbResult.error.message}`);
   }
 
   const computeResult = await loadComputeFn(senseIndexPath);
   if (!computeResult.ok) {
-    process.stderr.write(
-      `[sense-worker] Failed to load compute for "${senseName}": ${computeResult.error.message}\n`,
-    );
-    process.exit(1);
+    throw new Error(`Failed to load compute for "${senseName}": ${computeResult.error.message}`);
   }
 
   const { db } = dbResult.value;
@@ -129,12 +123,70 @@ function buildPeers(
   return Object.fromEntries(entries);
 }
 
+// ---------------------------------------------------------------------------
+// Grace period: hard kill after soft timeout
+// ---------------------------------------------------------------------------
+
+const gracePeriodTimers = new Map<string, ReturnType<typeof setTimeout>>();
+
+function scheduleGracePeriodKill(senseName: string, gracePeriodMs: number): void {
+  if (gracePeriodTimers.has(senseName)) return;
+  process.stderr.write(`[sense-worker] grace period for "${senseName}" (${gracePeriodMs}ms)\n`);
+  const timer = setTimeout(() => {
+    process.stderr.write(`[sense-worker] grace period expired for "${senseName}", hard kill\n`);
+    process.exit(1);
+  }, gracePeriodMs);
+  gracePeriodTimers.set(senseName, timer);
+}
+
+function clearGracePeriodTimer(senseName: string): void {
+  const timer = gracePeriodTimers.get(senseName);
+  if (timer === undefined) return;
+  clearTimeout(timer);
+  gracePeriodTimers.delete(senseName);
+}
+
+// ---------------------------------------------------------------------------
+// Compute execution with error isolation
+// ---------------------------------------------------------------------------
+
+async function runCompute(
+  senseName: string,
+  runtime: SenseRuntime,
+  peers: PeerMap,
+  timeoutMs: number,
+  gracePeriodMs: number | null,
+): Promise<void> {
+  try {
+    const result = await executeCompute(runtime, peers, timeoutMs);
+    if (!result.ok) {
+      sendError(senseName, result.error.message);
+      if (gracePeriodMs !== null && result.error.message.includes("timed out")) {
+        scheduleGracePeriodKill(senseName, gracePeriodMs);
+      }
+      return;
+    }
+    clearGracePeriodTimer(senseName);
+    if (result.value !== null) {
+      sendSignal(senseName, result.value);
+    }
+  } catch (e: unknown) {
+    const errMsg = e instanceof Error ? e.message : String(e);
+    sendError(senseName, errMsg);
+  }
+}
+
+// ---------------------------------------------------------------------------
+// IPC message dispatch
+// ---------------------------------------------------------------------------
+
 function handleMessage(
   raw: unknown,
   runtimes: Map<string, SenseRuntime>,
   peers: PeerMap,
   group: string,
   timeoutMs: number,
+  gracePeriodMs: number | null,
   inFlight: Map<string, Promise<void>>,
 ): void {
   const parseResult = parseParentMessage(raw);
@@ -149,33 +201,31 @@ function handleMessage(
     process.exit(0);
   }
 
-  if (msg.type === "compute") {
-    const runtime = runtimes.get(msg.sense);
-    if (!runtime) {
-      sendError(msg.sense, `Unknown sense "${msg.sense}" in group "${group}"`);
-      return;
-    }
-
-    // Serialize computes for the same sense
-    const previous = inFlight.get(msg.sense) ?? Promise.resolve();
-    const next = previous.then(async () => {
-      const result = await executeCompute(runtime, peers, timeoutMs);
-      if (!result.ok) {
-        sendError(msg.sense, result.error.message);
-        return;
-      }
-      if (result.value !== null) {
-        sendSignal(msg.sense, result.value);
-      }
+  if (msg.type === "health-request") {
+    send({
+      type: "health-response",
+      senses: [...runtimes.keys()],
+      inFlightCount: inFlight.size,
     });
+    return;
+  }
 
-    const tracked = next.catch((e: unknown) => {
+  if (msg.type !== "compute") return;
+
+  const runtime = runtimes.get(msg.sense);
+  if (!runtime) {
+    sendError(msg.sense, `Unknown sense "${msg.sense}" in group "${group}"`);
+    return;
+  }
+
+  const previous = inFlight.get(msg.sense) ?? Promise.resolve();
+  const next = previous
+    .then(() => runCompute(msg.sense, runtime, peers, timeoutMs, gracePeriodMs))
+    .catch((e: unknown) => {
       const errMsg = e instanceof Error ? e.message : String(e);
       sendError(msg.sense, errMsg);
     });
-
-    inFlight.set(msg.sense, tracked);
-  }
+  inFlight.set(msg.sense, next);
 }
 
 // ---------------------------------------------------------------------------
@@ -198,29 +248,42 @@ async function bootstrap(nerveRoot: string, group: string): Promise<void> {
 
   const runtimes = new Map<string, SenseRuntime>();
   const ownDbs = new Map<string, DrizzleDB>();
+  const failedSenses: string[] = [];
 
   for (const senseName of groupSenses) {
-    const { db, runtime } = await initSense(nerveRoot, senseName);
-    ownDbs.set(senseName, db);
-    runtimes.set(senseName, runtime);
+    try {
+      const { db, runtime } = await initSense(nerveRoot, senseName);
+      ownDbs.set(senseName, db);
+      runtimes.set(senseName, runtime);
+    } catch (e: unknown) {
+      const eMsg = e instanceof Error ? e.message : String(e);
+      process.stderr.write(
+        `[sense-worker] Failed to load sense "${senseName}", skipping: ${eMsg}\n`,
+      );
+      failedSenses.push(senseName);
+    }
+  }
+
+  // If ALL senses failed, exit with error so kernel respawns
+  if (runtimes.size === 0) {
+    process.stderr.write(`[sense-worker] All senses in group "${group}" failed to load, exiting\n`);
+    process.exit(1);
   }
 
   const groupSenseNames = new Set(groupSenses);
   const peers = buildPeers(nerveRoot, Object.keys(config.senses), ownDbs, groupSenseNames);
 
-  // Read timeout from config (uses first group sense's config, or default)
+  // Read timeout and grace period from config (uses first group sense's config)
   const firstSenseConfig = config.senses[groupSenses[0]];
-  const timeoutMs =
-    typeof (firstSenseConfig as Record<string, unknown>).timeoutMs === "number"
-      ? ((firstSenseConfig as Record<string, unknown>).timeoutMs as number)
-      : DEFAULT_TIMEOUT_MS;
+  const timeoutMs = firstSenseConfig?.timeout ?? DEFAULT_TIMEOUT_MS;
+  const gracePeriodMs = firstSenseConfig?.gracePeriod ?? null;
 
   const inFlight = new Map<string, Promise<void>>();
 
   sendReady();
 
   process.on("message", (raw: unknown) => {
-    handleMessage(raw, runtimes, peers, group, timeoutMs, inFlight);
+    handleMessage(raw, runtimes, peers, group, timeoutMs, gracePeriodMs, inFlight);
   });
 }