Plain-language definitions for the terms used across these pages. Each one is meant to be readable on its own.
How Velerian's AI works — the words
Agent
A software worker that takes a task, works through the steps, and produces a result — it does a piece of work, not just answer a question. Unlike a chatbot, it has a defined job and defined limits.
Governed
The agent operates inside fixed rules: what it may do, what it must check, and where a person has to sign off. Nothing happens outside those rules.
Guardrail
A rule the agent cannot break — for example, "never issue a denial without citing a specific policy clause."
Evaluator (or gate)
An automatic check that reviews the agent's work before it is released. Work that doesn't pass doesn't ship.
Fail-closed
If the agent isn't confident or can't support its answer, it stops rather than guessing.
Evidence trail
The record that travels with every decision — the reasoning, the sources it cited, and who approved it — so anyone can later see how the decision was reached.
Human-in-the-loop
A qualified person stays responsible for the final call. The agent does the heavy lifting and hands the decision to that person to approve.
Hallucination
When an AI says something that sounds right but isn't supported by the facts. Velerian's checks are built to catch and block these before they reach anyone.
Claims & regulation — the words
Audit-bearing work
Work that has to stand up to outside review — where you may later be asked to show exactly how and why a decision was made.
UCSPA (Unfair Claims Settlement Practices Act)
State rules defining how insurers must handle claims fairly. Falling short can bring regulatory penalties.
NAIC AI Model Bulletin
Guidance — adopted by many states — that sets out how insurers are expected to govern the AI they use in decisions, and lets regulators inspect it.
Bad faith
A finding that an insurer handled a claim unreasonably or unfairly. It can carry significant legal and financial exposure.
Prompt-payment
State laws requiring claims to be paid — or formally responded to — within set deadlines.
Market-conduct exam
A regulator's review of how an insurer actually runs its business, including claims handling, where documentation gets inspected.