Artificial Intelligence in Insurance Claims Management: Opportunities and Risks

Artificial intelligence is emerging as an important technology for improving insurance claims management. Insurers are increasingly using machine learning, automated document processing, image recognition, and predictive analytics to detect fraudulent claims and accelerate settlement processes. This paper examines the opportunities and risks associated with the adoption of artificial intelligence in insurance claims management in India. The study focuses on the potential benefits of faster claim processing, improved fraud detection, reduced administrative costs, and enhanced customer experience. At the same time, the use of algorithmic decision-making raises concerns regarding data quality, transparency, bias, cybersecurity, and accountability. The paper argues that AI should be implemented within a responsible governance framework that maintains appropriate human oversight. Effective regulation, explainable algorithms, strong data protection mechanisms, and transparent communication with policyholders are essential for building trust. The study concludes that responsible AI adoption can significantly improve insurance operational efficiency while maintaining consumer protection.