Abstract: Artificial Intelligence (AI) is reshaping the insurance industry by enhancing risk assessment, streamlining claims management, preventing fraud, and improving customer satisfaction. This study explores the applications of AI in insurance operations, evaluates its effectiveness, identifies challenges in implementation, and suggests strategic approaches to maximize its benefits. Using a combination of secondary data from industry reports, academic literature, and case studies, the research highlights how AI technologies—such as machine learning, predictive analytics, natural language processing, and robotic process automation—improve operational efficiency and decision-making accuracy. Findings reveal that AI significantly enhances risk profiling, accelerates claim settlements, reduces fraudulent payouts, and strengthens policyholder trust. However, challenges such as high implementation costs, integration with legacy systems, data quality issues, and regulatory compliance must be addressed for sustainable adoption. The study concludes that strategic AI adoption, combined with human oversight and customer-centric approaches, provides insurers with a competitive advantage while delivering efficient and reliable services.

Keywords: Artificial Intelligence (AI), Insurance, Risk Assessment, Claims Management, Fraud Detection, Customer Satisfaction, Operational Efficiency, Predictive Analytics.

Download: | DOI: 10.17148/IMRJR.2026.030110