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AI Hallucinations in Claims: Avoiding the Hidden Compliance & Litigation Risk Insurers Can’t Ignore
Industry Insights

AI Hallucinations in Claims: Avoiding the Hidden Compliance & Litigation Risk Insurers Can’t Ignore

AI is transforming claims processing, but most models weren’t built for insurance compliance. When AI fabricates policy details or misinterprets regulations, it creates compliance exposure, legal risk, and operational inefficiencies.

It's no question that AI is transforming claims. But, when an AI model hallucinates to fabricate policy details or misinterpret regulations, insurers face compliance failures and legal exposures.

Without oversight, automation becomes a liability. This new white paper reveals how top carriers prevent AI errors, ensure auditability, and scale automation—without the risk.

We break down why hallucinations happen and the compliance risks they pose. From there, we walk through the key safeguards insurers need to  protect their organization and a case study on how leading carriers are leveraging AI without the risk.

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Download this white paper to learn:

✔ How AI hallucinations introduce compliance and litigation risk

✔ Why insurers need full oversight of AI-generated claim documents

✔ What leading insurers are doing to scale AI safely while ensuring accuracy

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Free Whitepaper

AI Hallucinations in Claims: Avoiding the Hidden Compliance & Litigation Risk Insurers Can’t Ignore

It's no question that AI is transforming claims. But, when an AI model hallucinates to fabricate policy details or misinterpret regulations, insurers face compliance failures and legal exposures.

Without oversight, automation becomes a liability. This new white paper reveals how top carriers prevent AI errors, ensure auditability, and scale automation—without the risk.

We break down why hallucinations happen and the compliance risks they pose. From there, we walk through the key safeguards insurers need to  protect their organization and a case study on how leading carriers are leveraging AI without the risk.

‍

Download this white paper to learn:

✔ How AI hallucinations introduce compliance and litigation risk

✔ Why insurers need full oversight of AI-generated claim documents

✔ What leading insurers are doing to scale AI safely while ensuring accuracy

‍

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Frequently Asked Questions

How is Kyber different from traditional CCMs?

Kyber isn’t just a template library. It uses AI to pull the right policy language, apply jurisdictional rules, and generate accurate notices automatically. Every draft includes a built-in audit trail for full compliance visibility. Unlike legacy CCMs, Kyber is also lightweight to implement and easy to maintain across your claims team.

How does Kyber ensure compliance?

Kyber applies pre-approved templates, inserts only validated policy language, and enforces jurisdictional requirements for every letter. All edits, approvals, and versions are tracked automatically. All your organization's documents are audit-ready by default.

Does Kyber integrate with my existing Claims System?

Yes. Kyber is customizable to your organization’s existing tech stack (including core systems) and processes

How much time does it take to implement Kyber?

Most teams are live in under two months when integrating with an existing claims system. For new integrations or more complex environments, implementation typically takes up to four months with full support from our onboarding team.

How does Kyber protect my organization’s data?

Kyber supports on-premise and private cloud deployments, and meets SOC 2 Type II compliance standards. You can choose the architecture that aligns with your internal security protocols while maintaining full control over sensitive claims and policy data.