How GenAI Is Revolutionizing Contract Analysis

Generative AI (GenAI) is revolutionizing contract analysis for legal teams, providing efficient ways to assess terms, identify clauses, and predict legal issues, as Disco discussed in a post on its website.

The concept of using the technology is gaining traction. According to a Thomson Reuters report, 40% of corporate legal teams are considering GenAI for contract analysis. 

AI facilitates parsing and filtering of contract repository data, automates drafting and approval workflows, and generates insightful reports. Contract analysis benefits from the speed and precision of GenAI, which ensures quick and accurate evaluations.

The key advantage of using GenAI in contract analysis is its ability to swiftly compare proposed terms with accepted agreements, identifying crucial clauses and potential legal issues. This expedites the negotiation process, reducing time to revenue. Whether opting for an in-house model or an out-of-the-box solution, legal teams can leverage GenAI to highlight deviations from standard terms, trigger approval workflows, and generate insightful reports. 

However, there are challenges in using GenAI for contract analysis. Choosing the right model, ensuring data security, maintaining accuracy, and accommodating international languages are critical considerations. Legal teams should select models specifically built for analyzing legal documents and prioritize data security in a highly secure cloud environment. Human validation remains crucial in addressing AI mistakes. 

To adopt GenAI for contract analysis successfully, legal teams should assemble a representative sample of contracts and ensure that the dataset includes a diversity of legal terms and clauses and that the model has been trained in multiple languages. Overall, GenAI presents a transformative tool for legal professionals, enhancing efficiency and decision-making in contract analysis.