diff --git a/src/exo/shared/constants.py b/src/exo/shared/constants.py
index e6870a73..12bc1634 100644
--- a/src/exo/shared/constants.py
+++ b/src/exo/shared/constants.py
@@ -97,3 +97,5 @@ EXO_OFFLINE = os.getenv("EXO_OFFLINE", "false").lower() == "true"
 EXO_TRACING_ENABLED = os.getenv("EXO_TRACING_ENABLED", "false").lower() == "true"
 
 EXO_MAX_CONCURRENT_REQUESTS = int(os.getenv("EXO_MAX_CONCURRENT_REQUESTS", "8"))
+
+EXO_MAX_INSTANCE_RETRIES = 3
diff --git a/src/exo/utils/keyed_backoff.py b/src/exo/utils/keyed_backoff.py
index b481d43e..4d7c9a66 100644
--- a/src/exo/utils/keyed_backoff.py
+++ b/src/exo/utils/keyed_backoff.py
@@ -1,10 +1,9 @@
 import time
-from typing import Generic, TypeVar
-
-K = TypeVar("K")
+from typing import final
 
 
-class KeyedBackoff(Generic[K]):
+@final
+class KeyedBackoff[K]:
     """Tracks exponential backoff state per key."""
 
     def __init__(self, base: float = 0.5, cap: float = 10.0):
@@ -26,6 +25,10 @@ class KeyedBackoff(Generic[K]):
         self._last_time[key] = time.monotonic()
         self._attempts[key] = self._attempts.get(key, 0) + 1
 
+    def attempts(self, key: K) -> int:
+        """Return the number of recorded attempts for a key."""
+        return self._attempts.get(key, 0)
+
     def reset(self, key: K) -> None:
         """Reset backoff state for a key (e.g., on success)."""
         self._attempts.pop(key, None)
diff --git a/src/exo/worker/main.py b/src/exo/worker/main.py
index ded0481b..08cc1e0e 100644
--- a/src/exo/worker/main.py
+++ b/src/exo/worker/main.py
@@ -9,9 +9,11 @@ from loguru import logger
 from exo.api.types import ImageEditsTaskParams
 from exo.download.download_utils import is_read_only_model_dir, resolve_existing_model
 from exo.shared.apply import apply
+from exo.shared.constants import EXO_MAX_INSTANCE_RETRIES
 from exo.shared.models.model_cards import ModelId, add_to_card_cache, delete_custom_card
 from exo.shared.types.chunks import InputImageChunk
 from exo.shared.types.commands import (
+    DeleteInstance,
     ForwarderCommand,
     ForwarderDownloadCommand,
     StartDownload,
@@ -23,6 +25,7 @@ from exo.shared.types.events import (
     Event,
     IndexedEvent,
     InputChunkReceived,
+    InstanceDeleted,
     NodeDownloadProgress,
     NodeGatheredInfo,
     TaskCreated,
@@ -44,6 +47,7 @@ from exo.shared.types.tasks import (
 )
 from exo.shared.types.topology import Connection, SocketConnection
 from exo.shared.types.worker.downloads import DownloadCompleted
+from exo.shared.types.worker.instances import InstanceId
 from exo.shared.types.worker.runners import RunnerId
 from exo.utils.channels import Receiver, Sender, channel
 from exo.utils.info_gatherer.info_gatherer import GatheredInfo, InfoGatherer
@@ -84,6 +88,9 @@ class Worker:
         self.image_cache: dict[str, str] = {}
 
         self._download_backoff: KeyedBackoff[ModelId] = KeyedBackoff(base=0.5, cap=10.0)
+        self._instance_backoff: KeyedBackoff[InstanceId] = KeyedBackoff(
+            base=0.5, cap=10.0
+        )
         self._stopped: anyio.Event = anyio.Event()
 
     async def run(self):
@@ -127,6 +134,9 @@ class Worker:
                 self.state = apply(self.state, event=event)
                 event = event.event
 
+                if isinstance(event, InstanceDeleted):
+                    self._instance_backoff.reset(event.instance_id)
+
                 # Buffer input image chunks for image editing
                 if isinstance(event, InputChunkReceived):
                     cmd_id = event.command_id
@@ -156,15 +166,24 @@ class Worker:
                 self.state.runners,
                 self.state.tasks,
                 self.input_chunk_buffer,
+                self._instance_backoff,
+                self._download_backoff,
             )
             if task is None:
                 continue
 
-            # Gate DownloadModel on backoff BEFORE emitting TaskCreated
-            # to prevent flooding the event log with useless events
-            if isinstance(task, DownloadModel):
-                model_id = task.shard_metadata.model_card.model_id
-                if not self._download_backoff.should_proceed(model_id):
+            if isinstance(task, CreateRunner):
+                iid = task.instance_id
+                if self._instance_backoff.attempts(iid) >= EXO_MAX_INSTANCE_RETRIES:
+                    logger.warning(
+                        f"Instance {iid} exceeded {EXO_MAX_INSTANCE_RETRIES} retries, requesting deletion"
+                    )
+                    await self.command_sender.send(
+                        ForwarderCommand(
+                            origin=self._system_id,
+                            command=DeleteInstance(instance_id=iid),
+                        )
+                    )
                     continue
 
             logger.info(f"Worker plan: {task.__class__.__name__}")
@@ -175,6 +194,7 @@ class Worker:
             match task:
                 case CreateRunner():
                     self._create_supervisor(task)
+                    self._instance_backoff.record_attempt(task.instance_id)
                     await self.event_sender.send(
                         TaskStatusUpdated(
                             task_id=task.task_id, task_status=TaskStatus.Complete
diff --git a/src/exo/worker/plan.py b/src/exo/worker/plan.py
index 0df10ca4..71348118 100644
--- a/src/exo/worker/plan.py
+++ b/src/exo/worker/plan.py
@@ -3,7 +3,7 @@
 from collections.abc import Mapping, Sequence
 
 from exo.shared.types.chunks import InputImageChunk
-from exo.shared.types.common import CommandId, NodeId
+from exo.shared.types.common import CommandId, ModelId, NodeId
 from exo.shared.types.tasks import (
     CancelTask,
     ConnectToGroup,
@@ -39,6 +39,7 @@ from exo.shared.types.worker.runners import (
     RunnerStatus,
     RunnerWarmingUp,
 )
+from exo.utils.keyed_backoff import KeyedBackoff
 from exo.worker.runner.runner_supervisor import RunnerSupervisor
 
 
@@ -50,18 +51,22 @@ def plan(
     instances: Mapping[InstanceId, Instance],
     all_runners: Mapping[RunnerId, RunnerStatus],  # all global
     tasks: Mapping[TaskId, Task],
-    input_chunk_buffer: Mapping[CommandId, Mapping[int, InputImageChunk]] | None = None,
+    input_chunk_buffer: Mapping[CommandId, Mapping[int, InputImageChunk]],
+    instance_backoff: KeyedBackoff[InstanceId],
+    download_backoff: KeyedBackoff[ModelId],
 ) -> Task | None:
     # Python short circuiting OR logic should evaluate these sequentially.
     return (
         _cancel_tasks(runners, tasks)
         or _kill_runner(runners, all_runners, instances)
-        or _create_runner(node_id, runners, instances)
-        or _model_needs_download(node_id, runners, global_download_status)
+        or _create_runner(node_id, runners, instances, instance_backoff)
+        or _model_needs_download(
+            node_id, runners, global_download_status, download_backoff
+        )
         or _init_distributed_backend(runners, all_runners)
         or _load_model(runners, all_runners, global_download_status)
         or _ready_to_warmup(runners, all_runners)
-        or _pending_tasks(runners, tasks, all_runners, input_chunk_buffer or {})
+        or _pending_tasks(runners, tasks, all_runners, input_chunk_buffer)
     )
 
 
@@ -92,8 +97,12 @@ def _create_runner(
     node_id: NodeId,
     runners: Mapping[RunnerId, RunnerSupervisor],
     instances: Mapping[InstanceId, Instance],
+    instance_backoff: KeyedBackoff[InstanceId],
 ) -> CreateRunner | None:
     for instance in instances.values():
+        if not instance_backoff.should_proceed(instance.instance_id):
+            continue
+
         runner_id = instance.shard_assignments.node_to_runner.get(node_id, None)
         if runner_id is None:
             continue
@@ -116,6 +125,7 @@ def _model_needs_download(
     node_id: NodeId,
     runners: Mapping[RunnerId, RunnerSupervisor],
     global_download_status: Mapping[NodeId, Sequence[DownloadProgress]],
+    download_backoff: KeyedBackoff[ModelId],
 ) -> DownloadModel | None:
     local_downloads = global_download_status.get(node_id, [])
     download_status = {
@@ -124,12 +134,16 @@ def _model_needs_download(
 
     for runner in runners.values():
         model_id = runner.bound_instance.bound_shard.model_card.model_id
-        if isinstance(runner.status, RunnerIdle) and (
-            model_id not in download_status
-            or not isinstance(
-                download_status[model_id],
-                (DownloadOngoing, DownloadCompleted, DownloadFailed),
+        if (
+            isinstance(runner.status, RunnerIdle)
+            and (
+                model_id not in download_status
+                or not isinstance(
+                    download_status[model_id],
+                    (DownloadOngoing, DownloadCompleted, DownloadFailed),
+                )
             )
+            and download_backoff.should_proceed(model_id)
         ):
             # We don't invalidate download_status randomly in case a file gets deleted on disk
             return DownloadModel(
@@ -272,7 +286,7 @@ def _pending_tasks(
     runners: Mapping[RunnerId, RunnerSupervisor],
     tasks: Mapping[TaskId, Task],
     all_runners: Mapping[RunnerId, RunnerStatus],
-    input_chunk_buffer: Mapping[CommandId, Mapping[int, InputImageChunk]] | None,
+    input_chunk_buffer: Mapping[CommandId, Mapping[int, InputImageChunk]],
 ) -> Task | None:
     for task in tasks.values():
         # for now, just forward chat completions
@@ -287,7 +301,6 @@ def _pending_tasks(
         if isinstance(task, (ImageEdits, TextGeneration)):
             expected_image_chunks = task.task_params.total_input_chunks
         if expected_image_chunks > 0:
-            assert input_chunk_buffer is not None
             cmd_id = task.command_id
             received = len(input_chunk_buffer.get(cmd_id, {}))
             if received < expected_image_chunks:
diff --git a/src/exo/worker/tests/unittests/test_plan/test_download_and_loading.py b/src/exo/worker/tests/unittests/test_plan/test_download_and_loading.py
index abcb4939..461d8f12 100644
--- a/src/exo/worker/tests/unittests/test_plan/test_download_and_loading.py
+++ b/src/exo/worker/tests/unittests/test_plan/test_download_and_loading.py
@@ -8,6 +8,7 @@ from exo.shared.types.worker.runners import (
     RunnerConnected,
     RunnerIdle,
 )
+from exo.utils.keyed_backoff import KeyedBackoff
 from exo.worker.tests.constants import (
     INSTANCE_1_ID,
     MODEL_A_ID,
@@ -52,6 +53,9 @@ def test_plan_requests_download_when_waiting_and_shard_not_downloaded():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, plan_mod.DownloadModel)
@@ -104,6 +108,9 @@ def test_plan_loads_model_when_all_shards_downloaded_and_waiting():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, LoadModel)
@@ -146,6 +153,9 @@ def test_plan_does_not_request_download_when_shard_already_downloaded():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert not isinstance(result, plan_mod.DownloadModel)
@@ -193,6 +203,9 @@ def test_plan_does_not_load_model_until_all_shards_downloaded_globally():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -213,6 +226,9 @@ def test_plan_does_not_load_model_until_all_shards_downloaded_globally():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is not None
diff --git a/src/exo/worker/tests/unittests/test_plan/test_runner_lifecycle.py b/src/exo/worker/tests/unittests/test_plan/test_runner_lifecycle.py
index a1b87ca1..1ac9dee0 100644
--- a/src/exo/worker/tests/unittests/test_plan/test_runner_lifecycle.py
+++ b/src/exo/worker/tests/unittests/test_plan/test_runner_lifecycle.py
@@ -9,6 +9,7 @@ from exo.shared.types.worker.runners import (
     RunnerReady,
     RunnerStatus,
 )
+from exo.utils.keyed_backoff import KeyedBackoff
 from exo.worker.tests.constants import (
     INSTANCE_1_ID,
     MODEL_A_ID,
@@ -52,6 +53,9 @@ def test_plan_kills_runner_when_instance_missing():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, Shutdown)
@@ -91,6 +95,9 @@ def test_plan_kills_runner_when_sibling_failed():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, Shutdown)
@@ -122,6 +129,9 @@ def test_plan_creates_runner_when_missing_for_node():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     # We patched plan_mod.CreateRunner → CreateRunner
@@ -160,6 +170,9 @@ def test_plan_does_not_create_runner_when_supervisor_already_present():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -189,6 +202,9 @@ def test_plan_does_not_create_runner_for_unassigned_node():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
diff --git a/src/exo/worker/tests/unittests/test_plan/test_task_forwarding.py b/src/exo/worker/tests/unittests/test_plan/test_task_forwarding.py
index 64be74e6..0aa901ce 100644
--- a/src/exo/worker/tests/unittests/test_plan/test_task_forwarding.py
+++ b/src/exo/worker/tests/unittests/test_plan/test_task_forwarding.py
@@ -9,6 +9,7 @@ from exo.shared.types.worker.runners import (
     RunnerReady,
     RunnerRunning,
 )
+from exo.utils.keyed_backoff import KeyedBackoff
 from exo.worker.tests.constants import (
     COMMAND_1_ID,
     INSTANCE_1_ID,
@@ -71,6 +72,9 @@ def test_plan_forwards_pending_chat_completion_when_runner_ready():
         instances=instances,
         all_runners=all_runners,
         tasks={TASK_1_ID: task},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is task
@@ -120,6 +124,9 @@ def test_plan_does_not_forward_chat_completion_if_any_runner_not_ready():
         instances=instances,
         all_runners=all_runners,
         tasks={TASK_1_ID: task},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -166,6 +173,9 @@ def test_plan_does_not_forward_tasks_for_other_instances():
         instances=instances,
         all_runners=all_runners,
         tasks={foreign_task.task_id: foreign_task},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -230,6 +240,9 @@ def test_plan_ignores_non_pending_or_non_chat_tasks():
         instances=instances,
         all_runners=all_runners,
         tasks={TASK_1_ID: completed_task, other_task_id: other_task},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -269,6 +282,9 @@ def test_plan_returns_none_when_nothing_to_do():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
diff --git a/src/exo/worker/tests/unittests/test_plan/test_warmup.py b/src/exo/worker/tests/unittests/test_plan/test_warmup.py
index 52848446..612868e7 100644
--- a/src/exo/worker/tests/unittests/test_plan/test_warmup.py
+++ b/src/exo/worker/tests/unittests/test_plan/test_warmup.py
@@ -7,6 +7,7 @@ from exo.shared.types.worker.runners import (
     RunnerLoading,
     RunnerWarmingUp,
 )
+from exo.utils.keyed_backoff import KeyedBackoff
 from exo.worker.tests.constants import (
     INSTANCE_1_ID,
     MODEL_A_ID,
@@ -61,6 +62,9 @@ def test_plan_starts_warmup_for_accepting_rank_when_all_loaded_or_warming():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, StartWarmup)
@@ -102,6 +106,9 @@ def test_plan_starts_warmup_for_rank_zero_after_others_warming():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, StartWarmup)
@@ -142,6 +149,9 @@ def test_plan_does_not_start_warmup_for_non_zero_rank_until_all_loaded_or_warmin
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -186,6 +196,9 @@ def test_plan_does_not_start_warmup_for_rank_zero_until_others_warming():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -202,6 +215,9 @@ def test_plan_does_not_start_warmup_for_rank_zero_until_others_warming():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, StartWarmup)
@@ -245,6 +261,9 @@ def test_plan_starts_warmup_for_connecting_rank_after_others_warming():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert isinstance(result, StartWarmup)
@@ -287,6 +306,9 @@ def test_plan_does_not_start_warmup_for_accepting_rank_until_all_loaded_or_warmi
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None
@@ -328,6 +350,9 @@ def test_plan_does_not_start_warmup_for_connecting_rank_until_others_warming():
         instances=instances,
         all_runners=all_runners,
         tasks={},
+        input_chunk_buffer={},
+        instance_backoff=KeyedBackoff(),
+        download_backoff=KeyedBackoff(),
     )
 
     assert result is None