Account recovery is by far the #1 kind of ticket
any service will get. Either because people forget their credentials, lose their credentials, get hacked or get impersonated - and that's just the
legitimate tickets, on top of that come illegitimate tickets from everyday script kiddies over ransom extortioners (i.e. the people that aim to steal "valuable" handles) to nation-state actors that, say, want to get access to DMs of people messaging oppositional accounts.
That in turn means three things... it costs a lot of money to have humans look at these tickets, the PR damage from both acting and not acting on such requests can be immense, and users/customers can be anything from the smartest and richest people on the world down to the kind of utter imbeciles whose brains get surpassed by bears [1] or who plainly are not able to write. To make it worse, often enough online services don't have any kind of tie back to some known government-issued ID (either directly or by a proxy such as a mobile phone SIM), there's corruption involved on all levels, and for particularly "juicy" targets the stakes, if they can be converted to a monetary amount at all, can reach into the millions of dollars.
Now, Instagram alone has 3 billion (!) users from across the world, so they are bound to not just having to spend a lot of money on user support (remember, we are talking about the entire world, they also need to deal with about 7.000 (!) actively spoken languages, and having attack targets that are as powerful as US Presidents or as rich as Elon Musk. Clearly, the risk management involved in the entire idea was horribly deficient, but let's not act like this is a trivial problem domain in the first place. And hence the push for AI, simply because it - if done correctly - can take a lot of work off of the first-level support desks for a fraction of the money.
[1] https://velvetshark.com/til/til-smartest-bears-dumbest-touri...
[2] https://www.sapiens.org/language/world-languages-counting-me...