Buyer’s guide for AI contract review and analysis solution

For legal professionals, AI contract review and analysis technology can have a dramatic effect on workflow, risk management, and client satisfaction.

But how exactly does AI help? And what features should you look for when choosing the right tool for your firm? This buyers’ guide will explore those questions in depth.

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What is AI for contract review?

What can AI contract review and analysis tools do?

Benefits of AI contract review for legal teams

How AI supports contract review at scale

Risks and limitations of AI contract review

How to choose the best AI contract review solution

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What is AI for contract review?

AI contract review software utilizes machine learning, natural language processing, and trusted legal-domain content to analyze contracts, identify clauses, extract obligations, compare language, and surface risks.

These AI tools can extract critical information pertinent to individual clients, client types, or matters, while simultaneously automating more mundane tasks like managing deadlines and payment milestones. In doing so, the software can save attorneys substantial time while enhancing their accuracy and reliability.

How AI contract review differs from traditional contract review

Lawyers spend between 40 and 60% of their time drafting legal documents and reviewing contracts, according to Thomson Reuters research. Traditionally, this tedious contract review process involves manual document research, calendar tracking, and clause searches.

AI contract review software offers a faster, more efficient solution to traditional contract review methods. It utilizes AI-assisted extraction, summarization, obligation tracking, and deviation detection to review contracts fast — even up to thousands of contracts simultaneously. It can do what would normally take hours or days and reduce it to just minutes.

What can AI contract review and analysis tools do?

AI contract review tools can help legal professionals analyze contracts by extracting clauses, key terms, obligations, deadlines, parties, and risks from legal documents.

The high-value capabilities you get from these AI tools include features like:

1. Clause extraction
2. Risk flagging
3. Playbook comparison
4. Obligation tracking
5. Deadline management
6. Summary generation
7. Draft review
8. Proofreading and Error checking
9. MS Word integration
10. Analysis of comments and tracked changes

Let’s look at how some of these capabilities work in more detail:

Clause identification and problematic clause detection

AI tools can identify problematic contract clauses by detecting nonstandard, missing, risky, or inconsistent language in agreements. For example, AI can identify a force majeure clause without relying on the exact words “force majeure.”

Other common clauses AI can help identify and review include indemnification, limitation of liability, termination, renewal, assignment, confidentiality, governing law, dispute resolution, and payment terms. It can identify these types of problematic clauses through meaning and context, without needing the exact words present. And it can find these essential clauses in seconds, instead of requiring hours or days of manual searching.

Contract summarization and document analysis

A robust AI contract review tool can produce summaries, tables, reports, and issue lists from large contract sets. Its accuracy depends on the quality of the AI system, the legal-domain data grounding it, the testing behind it, and the attorney oversight.

That’s why it’s so vital that you ensure you’re using a trusted AI system tested by actual attorneys. Thomson Reuters CoCounsel Legal is designed for these professional legal workflows. It brings together AI, trusted content, and expert insights from resources like Westlaw and Practical Law, where applicable.

Deviation detection against playbooks and standards

Strong AI contract review tools can compare a contract’s language against approved templates, Practical Law resources, company playbooks, trusted legal content, or matter-specific standards. The ideal contract analysis solution will automatically detect any deviations from the sources you choose, and alert you to these instances.

This can free up a lot of time and mental capacity for your highly paid legal professionals to focus on higher-value work, rather than chasing down documents.

Obligation, deadline, and renewal tracking

AI can pull relevant dates directly from their original sources — the contracts — and then manage obligations, payments, and deadlines by sending you automatic notifications based on this data.

Examples include:

• Renewal dates
• Termination notice periods
• Payment milestones
• Compliance obligations
• Reporting requirements

Think of the time savings and improved accuracy you’ve experienced by moving from a hard copy calendar to a digital one. Now take that a step further by not having to enter calendar events at all. The time saved from this example alone is substantial.

Benefits of AI contract review for legal teams

Traditional contract review is critical but time-consuming and inefficient. With hundreds or thousands of contracts to manage, legal professionals keenly understand the efficiency and cost savings that can come from automating tasks.

By utilizing AI contract review tools, your legal teams will see benefits like:

• Efficiency
• Time savings
• Cost savings
• Improved consistency
• Risk reduction
• Better client service
• Talent retention

Just look at the time and cost savings a leading financial services firm enjoyed after adopting Thomson Reuters AI tools. They were able to cut the time they spent reviewing documents by 50 to 75%, freeing up their deputy general counsel’s time. By doing so, they reduced their reliance on outside counsel and are now saving up to $200,000 annually.

Independent research reinforces these findings. A 2026 Forrester Consulting Total Economic Impact™ study of Thomson Reuters CoCounsel Legal found customers achieved up to a 33% reduction in time spent on document review, research, and drafting, along with an average 25% reduction in nonbillable hours across those same workflows.

The composite organization modeled in the study realized a 400% three-year return on investment and an $18.3 million net present value, while avoiding the need to hire five additional support staff annually to keep pace with document-heavy workloads.

Below are more details about the benefits that legal teams can enjoy after adopting AI contract review tools:

Efficiency gains in contract drafting and review

AI can find essential clauses and other relevant points in just seconds instead of the hours or days of manual searching that lawyers would have to do by hand.

But this isn’t the only type of efficiency that AI tools bring to your firm. An improved contract workflow is another efficiency bonus. AI tools can modernize, streamline, and simplify the litigation and transactional process, enabling lawyers to prepare, draft, and negotiate agreements with maximum efficiency.

The scale of that acceleration can be dramatic in practice. One managing partner interviewed for the Forrester Consulting CoCounsel Legal study described a document summarization task that “would have taken me about 10 hours” being completed “in half an hour” once AI contract review tools were in place.

Better client service

By reducing the time spent on manual document search, first-pass review, and contract comparison, robust AI tools allow lawyers to focus more on higher level tasks like legal judgment, negotiation, and client advice. This provides far better service to clients than they might receive from overworked attorneys spending up to 60% of their time on contract reviews.

The pressure to deliver this kind of value is only increasing. Thomson Reuters’ Future of Professionals Report 2026: Law Firm found 77% of in-house legal professionals say it’s very important or essential that outside counsel demonstrate AI-enabled quality improvements — yet just 5% say they’re actually receiving this from most or all of their providers, making contract review technology a genuine competitive differentiator rather than a back-office upgrade.

Cost savings and higher-value legal work

Legal professionals spend an average of 15 minutes just searching for the right starting point in their research, according to Thomson Reuters studies. Automation can reduce the time spent on low-value document search and first-pass review, freeing lawyers to focus on negotiation, advice, and risk judgment.

More time spent on matters that involve legal expertise means the ability to handle more clients and greater profits for a law firm. There is no sense in dedicating trained, educated legal professionals to work that can be automated to provide greater efficiency and accuracy. Time saved is money saved.

Improved consistency and risk management

AI helps legal teams apply review standards more consistently across high volumes of contracts. Of course, human review remains essential. And this is where your attorneys can apply their higher-level skills.

Talent retention

Legal professionals appreciate tools that can make their lives easier and help them focus on what they love — using their expertise to help their clients. An environment that embraces these tools is one that can help retain and attract top talent.

For clients, cost savings is not just a bonus — it’s an expectation. If your firm is billing time for document searches that could be automated, the reasonableness of fees could become a point of contention.

How AI supports contract review at scale

AI helps your teams review legal agreements at scale by analyzing large volumes of contracts in minutes and extracting key information such as parties, dates, clauses, obligations, renewal terms, and termination provisions.

This isn’t a niche use case. Thomson Reuters’ 2026 AI in Professional Services Report found document review is now the second most common GenAI use case among legal professionals (74%), trailing only legal research (80%), while extracting contract data ranks among the top GenAI use cases for corporate risk and compliance teams (57%).

Key features AI tools utilize that make this possible include:

Bulk upload:

Easily upload large numbers of documents all at once rather than one at a time.

Auto-categorization

AI can automatically label and organize thousands of files instantly.

Large document analysis

AI can search through thousands of documents simultaneously, getting results in seconds.

Tabular analysis

AI can extract obligations, terms, and risks at scale, pulling structured data from multiple agreements simultaneously.

Triage

AI can identify patterns, flag deviations, and generate summaries that help lawyers triage and prioritize faster.

Quicker review workflows

AI can review documents in bulk for compliance, generating automated redlines in minutes.

Let’s look at some of these features in more detail:

Reviewing hundreds or thousands of legal agreements

For high-volume matters, AI can categorize documents, identify patterns, flag deviations, and generate summaries or tables that help lawyers triage and prioritize review.

These tools combine bulk document analysis with workflow integration, legal-domain grounding, security controls, and human review, allowing users to achieve in seconds what might have previously taken hours or days.

Use cases by practice area and transaction type

Legal teams can use AI contract review technology for numerous types of legal matters, ranging from M&A due diligence to real estate transactions, from renewable energy agreements to commercial contracting and contract lifecycle management.

Look for AI software that has modules dedicated to separate practice arenas, so the tools can respond to the evolving nuances in different facets of law.

Below are just a few examples of practice-specific applications.

1. Renewable energy contracts

Energy practice areas often deal with complex and specialized contracts, such as power purchase agreements, renewable energy certificates, and leases. You need a platform that can handle the nuances and variations of these contracts, as well as provide insights into market trends and risks.

2. Real estate contracts

In real estate, you deal with a high volume of contracts, such as leases, purchase agreements, mortgages, and deeds. You need something that can help you review these contracts faster and more accurately, as well as identify potential issues and opportunities.

AI software can extract key data points, such as parties, dates, clauses, obligations, and transaction milestones. A solution that is purpose-built for multi-stage transactions can be an indispensable ally in complex, drawn-out transactions that unfold over a long period of time.

3. M&A due diligence

In mergers and acquisitions, you face tight deadlines and complex negotiations, as well as the risk of missing important details or making costly errors. You need software that can help you conduct due diligence, draft and review contracts, and manage post-closing integration. The right AI tools can analyze large volumes of documents, such as NDAs and disclosure schedules, and flag any risks, inconsistencies, or deviations.

AI software can then generate summaries, reports, and insights to inform your strategy and decision-making, along with detecting any deviations in proposed variations of contracts.

4. Commercial contracting

AI contract tools can help you analyze multiple commercial contracts simultaneously, extracting key insights, compliance checks, and surface issues in minutes. You can even conduct favorability analyses to assess if the contract clauses favor one party over another. These tools allow you to move from redline to finalized agreements with confidence.

5. Contract lifecycle management

From the initial proposal to fulfillment, AI contract lifecycle management (CLM) can build and deploy workflows in minutes with pre-built connectors to your standard systems. It can also help your team review hundreds or thousands of agreements for recurring risks, missing clauses, nonstandard terms, or upcoming obligations.

Risks and limitations of AI contract review

Every advance in technology comes with risks. And of course, AI is no exception. This is why utilizing attorney verification is a vital part of using any AI solution wisely.

Some of the risks and limitations that can come with AI contract review solutions may include:

Inaccurate outputs and hallucinations: The team that trained the AI system you’re using should be versed in both technology and the law to ensure that AI retrieves the right information for more accurate outputs and fewer hallucinations.

Poor training data: Your AI tools are only as good as the data used to train them. A solution that leverages content only from trusted legal sources is more trustworthy itself.

Security and confidentiality: To protect client information and meet industry norms, your system should utilize encryption, role-based access controls, and have the relevant compliance certifications. Thomson Reuters’ tools, for example, have built-in privacy safeguards and secure infrastructure that is constantly being updated.

Ethical duties: Attorneys must be able to oversee their AI tools to effectively ensure compliance with ethical standards. This includes understanding how AI reaches its outputs and solutions.

Overreliance: Becoming overly reliant on AI tools is always a risk when using them. Maintaining attorney oversight is a vital part of mitigating AI risks and its importance cannot be overstated.

Why legal-domain data and human oversight matter

If AI is trained on bad information, it will return bad information. If it’s grounded in accurate, legal domain specific sources of data, that’s what it will extract and return.

That’s why it’s so important to confirm that your AI tools are only trained and using content from trusted legal-domain data. Thomson Reuters’ AI tools, for example, utilize retrieval-augmented generation (RAG) to pull query responses only from select legal sources, like Westlaw and Practical Law. This ensures that the language drafted is precise, up-to-date, and reflective of industry standards.

Of course, even when your AI is only sourcing the best legal content possible, this still doesn’t mean you can skip attorney oversight and verification. Attorneys must oversee all outputs to ensure there are no AI hallucinations or inaccuracies. You should verify AI accuracy just as a senior attorney would oversee a junior associate’s work.

As Ryan Groff, Senior Solutions Consultant at Thomson Reuters, notes: “Verification is the responsibility of our profession and that has never changed.”

Why consumer-grade AI is different from Fiduciary‑Grade AI™

The differences between consumer-grade AI and Fiduciary-Grade AI are substantial.

Public or general-purpose AI tools may lack verified legal content, instead pulling from the open web in general. Public AI tools may also lack fiduciary-grade security, auditability, and legal workflow integration.

Fiduciary-Grade AI, on the other hand, is built with safeguards and resources that attorneys can feel confident in, such as:

• Grounded only in authoritative, legal-domain content like Westlaw and Practical Law.
• Designed by practicing attorneys to ensure it works through legal problems like an attorney would.
• Presents a visible reasoning path, with transparent outputs that are verifiable, traceable, and defensible.
• Operates securely and privately, protecting sensitive data that’s not used to train third-party AI models.

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The pitfalls of consumer-grade tech and the power of professional AI-powered solutions for law firms

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How to choose the best AI contract review solution

With AI tools everywhere you turn, how do you narrow down the options to find the best fit for your contract management needs? The following checklists can help.

AI contract review evaluation checklist

Weigh the following considerations when selecting your AI tool:

Use case

Clearly define the purpose of AI in your firm’s contract management. A resource developed specifically for your use case will be far more useful than a general cookie cutter program.

Onboarding process

If installing and using the software requires extensive training, your firm is less likely to take full advantage of it.

Bulk upload

The best solutions provide a bulk upload option and auto-categorization of documents.

Cloud or on-premise

Does the software need to be installed on-premises or it it available on the cloud?

Cost transparency

Some vendors charge a fee for initially uploading documents and an ongoing fee to house them. Find a solution with a transparent pricing policy.

Time-to-value

Pre-trained AI can be a huge benefit. If the firm needs to “train” an AI in-house, this requires time, expertise, and motivation that you likely don’t have.

Support

Look for a solution backed by a solid customer service program. Does the vendor offer chat or phone responses, a database of Q&As, and a robust tutorial?

Integrations

Seek out tools that can integrate seamlessly with your current workflow, such as Microsoft Word and document management systems (DMS).

Security

Look for AI tools that utilize fiduciary-grade security, encryption, and auditability.

Data governance

Seek AI tools that can check compliance with internal policies and external regulations.

Vendor trust

Look for a vendor with a history of AI and language model development.

Legal expertise

The most effective AI solutions are developed by data scientists in conjunction with experienced attorneys.

Content grounding

Make sure the AI only pulls data from trusted legal-domain specific sources.

Key features to look for in AI contract review software

When reviewing and comparing potential AI contract review tools, look for the following key features:

• Clause extraction
• Playbook comparison
• Risk scoring or flagging
• Summaries
• Table output
• Document comparison
• Obligation tracking
• Microsoft Word integration
• DMS integration
• Audit trails
• Secure collaboration

Questions to ask before buying

Before committing to a tool, ask the following questions of the AI’s procurement and legal operations teams:

• What type of legal content grounds the AI?
• How is customer data handled?
• Can the tool explain or cite sources?
• How long does implementation take?
• Does it integrate with existing drafting and document management workflows?

AI, trusted content, and expert insights from Westlaw and Practical Law

CoCounsel Legal works together with trusted Thomson Reuters content, including Westlaw and Practical Law, to provide you with analysis that you can stand behind.

Here’s how:

CoCounsel Legal provides contract analysis and transparent workflows

CoCounsel Legal is a Fiduciary-Grade AI that offers reliable and comprehensive legal analysis for contract review. It provides transparent, secure, and verifiable workflows that are built for defensibility.

And it’s purpose-built by practicing attorneys, so it can provide the type of contract review support that you would expected from a trusted partner.

Westlaw and Practical Law provide trusted legal domain content

CoCounsel Legal draws from research in Westlaw for primary law and trusted Practical Law guidance, combined with your organization’s own knowledge datasets. It only these resources to move seamlessly from prompt to polished work product, providing top-tier research, analysis, and contract drafting.

You’ll find this is the most advanced single AI tool available that provides research, drafting, and contract analysis with speed and precision. And it allows you to work across tools you already use every day within a single unified user experience.

Frequently asked questions about AI contract review

Do you still have questions about AI contract analysis with CoCounsel Legal? Below are answers to some frequently asked questions.

Can AI review contracts for problematic clauses?

Yes. AI doesn’t need the exact words to be in the contract. It can identify problematic clauses through meaning and context. It’s designed to detect nonstandard, missing, risky, or inconsistent language in agreements.

Can AI review hundreds or thousands of cases at once?

Yes. AI can search through thousands of documents simultaneously, automatically labeling and auto-categorizing them for easy triage. It can combine bulk document analysis with workflow integration and legal-domain grounding, allowing users to achieve in seconds what could have taken days.

Is AI contract review accurate?

AI contract review is highly accurate if it is trained and tested with trustworthy legal-domain sources, like Thomson Reuters products. However, even with high-quality sources, it’s imperative to always have a human attorney oversee and verify AI results, just like you would oversee a junior partner.

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