Contribution · Application — Insurance

AI for Insurance Claims Adjudication

Claims processing is where insurers bleed — too slow and customers churn, too fast and fraud slips through. AI adjudication blends IDP (intelligent document processing) to extract from claim forms, RAG over the master policy schedule to check coverage, and a rules engine to decide clear-cut cases. Denials and high-value claims must always route to a human adjudicator — IRDAI treats full automation of denial with extreme skepticism.

Application facts

Domain
Insurance
Subdomain
Claims
Example stack
AWS Textract or Azure Document Intelligence for form IDP · Claude Opus 4.7 for policy reasoning and summarization · LlamaIndex over policy schedule and IRDAI circulars · Drools or custom rules engine for coverage logic · Duck Creek or Guidewire integration for core policy admin

Data & infrastructure needs

  • Policy schedules in structured form
  • Historical claims with outcomes (for evaluation)
  • Medical coding standards — ICD-10, CPT, PCS for health claims
  • IRDAI circulars and product-filing documents

Risks & considerations

  • Hallucinated coverage or exclusions
  • IRDAI Protection of Policyholders' Interests Regulations 2017 breaches on denials
  • Bias against claim segments or geographies
  • Data sensitivity — DPDPA + health data as sensitive personal data

Frequently asked questions

Is AI claims adjudication safe for insurers in India?

Only for clear approvals and triage. IRDAI norms require that claim denials be reasoned and human-verified. Use AI to accelerate valid approvals and route edge cases; never let it issue denials autonomously.

What model is best for claims adjudication?

For policy reasoning, Claude Opus 4.7 handles the nuanced language of exclusions and definitions well. For IDP, AWS Textract and Azure Document Intelligence lead on Indian claim forms. The rules engine should be deterministic, not ML-based, for the final decision.

Regulatory considerations for claims AI?

IRDAI Protection of Policyholders' Interests Regulations 2017, IRDAI Information and Cyber Security Guidelines 2023, DPDPA for policyholder data, EU AI Act high-risk classification for insurance decisioning, and NAIC model laws in the US.

Sources

  1. IRDAI regulations — accessed 2026-04-20
  2. IRDAI Cyber Security Guidelines 2023 — accessed 2026-04-20

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