Avoiding financial losses requires preventing catastrophic oil‐filled power transformer breakdowns. Continuous online transformer monitoring is needed. The authors use paper insulation to evaluate transformer health for continuous online transformer monitoring. The study suggests a new artificial intelligence method for estimating paper insulation residual life in oil‐immersed power transformers. The four artificial intelligence models use backpropagation‐based neural networks to predict paper insulation lifespan. Four primary transformer insulating paper failure indices—degree of polymerisation, 2‐furfuraldehyde, carbon monoxide, and carbon dioxide—form the basis of these models. Each model, including the backpropagation‐based neural networks, estimates paper insulation life using one failure index, along with moisture and temperature data. Optimisation techniques enhance hidden layer neurons and epoch count for improved performance. Results are validated against literature‐based life models, establishing a precise input–output correlation. This method accurately predicts the remaining useable life of power transformer paper insulation, enabling utilities to take proactive measures for safe and efficient transformer operation.