Assessment of the Positive Impacts and Potential Risks of AI Applications in Social Security

Abstract

In this article, I provide a comprehensive overview of the benefits and risks of AI applications in the area of social security and discuss their policy implications. AI has been applied across various dimensions of social security administration in Korea and elsewhere—notably in identity verification, eligibility screening, benefit calculation, fraud detection, risk classification, personalized services, case management, administrative process optimization, and policy evaluation. Using AI in these areas has proved beneficial in increasing administrative efficiency, improving timeliness and accuracy of benefit payments, reducing unmet needs, tailoring services to individual needs, and establishing databases for policy evaluation. However, AI applications also carry risks involving personal information breaches, data bias, the opacity of algorithmic decision-making, potential commercial exploitation of information, and the problem of explainability. The implications drawn point to the need to improve data quality, promote standardization, establish integrated governance, revise legal frameworks to include provisions on social security, create specialized organizations, and monitor international trends.