Human-in-the-loop means the AI does not act fully autonomously at every step. At specific checkpoints, a human must review the AI's output and confirm, modify, or reject it before the workflow continues.
An insurance claims process that handles low-value claims automatically and queues larger or flagged claims for a human adjuster — with the AI's analysis pre-populated — is using human-in-the-loop appropriately. This is not a failure mode or a limitation. It is a deliberate design choice for consequential decisions where the cost of an error justifies keeping a person in control.
