Installing Kotlin Plugin 1.4.31 causes Android Studio to not highlight syntax errors for a single file

Question

Syntax error highlighting isn't working for a single file in my project. I've tried:

1. Restart Android Studio
2. Restart Computer
3. Invalidate Caches and Restart
4. Clean and Rebuild Project
5. Sync Project with Gradle Files
6. Make sure I am not in Power Save Mode
7. Run Analyze -> Inspect Code on the file in question (no errors found)

I don't see any plugin errors when starting up Android Studio

If I make a syntax error in any other file, the offending piece of code is underlined immediately in red. When I build, the build fails because of the syntax errors.

Android Studio Info:

    Android Studio 4.1.2
    Build #AI-201.8743.12.41.7042882, built on December 19, 2020
    Runtime version: 1.8.0_242-release-1644-b01 amd64
    VM: OpenJDK 64-Bit Server VM by JetBrains s.r.o
    Windows 10 10.0
    GC: ParNew, ConcurrentMarkSweep
    Memory: 1246M
    Cores: 4
    Registry: ide.new.welcome.screen.force=true, external.system.auto.import.disabled=true
    Non-Bundled Plugins: com.thoughtworks.gauge, org.intellij.plugins.markdown, com.intellij.marketplace, org.jetbrains.kotlin

Reported as a bug here: https://issuetracker.google.com/issues/181717941

This is fixed by File -> Manage IDE Settings -> Restore Default Settings

It can be reproduced by installing the new Kotlin plugin