An AI policy engine receives signals about a model or agent run and evaluates configured rules. Policies can consider cost, iteration count, user segment, tool output size, completion progress and other run context.
The engine should have a bounded set of permitted actions, such as compacting context, reducing output, steering or halting. A separate governor can enforce that limit so a policy cannot make an intervention outside its authorized scope.
ELI5
A policy engine is a rule checker for an AI system. It looks at what the system is doing and decides whether a permitted action should continue, change, or stop according to rules set by its operators.
For example, a policy might say that an agent must stop after spending a set amount or ask for approval before using a sensitive tool. The engine can enforce that rule, but it should not have permission to invent actions outside its own clearly defined limits.
What can an AI policy engine decide?
It can decide whether to allow, modify, steer, limit or stop activity based on validated run signals and rules.
Why limit the interventions a policy engine may apply?
A bounded action set prevents governance logic from becoming an unrestricted source of new agent behavior.
