Volume 2 - Issue 1, January - February 2026

The integration of the Internet of Things (IoT) and Artificial Intelligence (AI) is transforming conventional insurance operations by enabling continuous monitoring, intelligent risk assessment, and automated claims processing. Traditional insurance models rely heavily on static historical data, manual inspections, and delayed reporting mechanisms, resulting in prolonged settlement cycles, inaccurate pricing, and vulnerability to fraudulent activities. IoT devices such as vehicle telematics units, wearable health sensors, and smart home monitoring systems generate continuous real-time data related to user behavior, environmental conditions, and asset performance. AI-based analytical models process this data to detect incidents, assess risk levels, and verify claims with minimal human intervention. This paper presents a comprehensive review of existing insurance claim processing systems and identifies their operational limitations. It further proposes an integrated IoT–AI framework for real-time insurance monitoring and claims automation. The proposed system employs machine learning, anomaly detection, computer vision, and natural language processing to improve underwriting accuracy, reduce fraud, and shorten claim settlement cycles. The study also discusses methodological components including data acquisition, transmission, analytics, and decision automation. The results indicate that IoT–AI integration enables insurers to transition from reactive compensation mechanisms to predictive and preventive insurance models. Despite challenges related to cybersecurity, data privacy, and implementation costs, the proposed approach significantly enhances operational efficiency, transparency, and customer satisfaction.

Mr.Mohanraj S, Mr.Lokesh Sowmith S,"IOT and AI Integration for Real-Time Insurance Monitoring and Claims Processing" International Journal of Advanced Multidisciplinary Research and Educational Development, V2(1): Page(1076-1079) Jan-Feb 2026. ISSN: 3107-6513. www.ijamred.com. Published by Scientific and Academic Research Publishing.