AI contract generators rely on artificial intelligence to generate business contracts. These tools automate the creation of customized contracts based on natural language processing and machine learning. The software generates high-quality contracts customized to specific needs, increasing efficiency, accuracy, and compliance.
Despite their potential, adoption has been slow due to concerns over security, reliability, and a general lack of understanding of the technology. In this guide, we will explain AI contract generators, address concerns, and illustrate best practices for their successful implementation, ultimately enabling legal professionals to improve their contracting practices.
TL;DR - 6 AI Contract Generator Tools
Here is a quick look at the list of tools that are mentioned in the blog, in case you want to jump right in:
Cone:
A comprehensive platform for automating proposals, invoicing, and payments. It offers a suite of solutions to manage business operations efficiently.
OpenLaw:
Utilizes blockchain technology under ConsenSys to create and manage legal agreements efficiently, with a focus on smart contracts.
LawDepot:
Offers a wide array of customizable legal document templates for free, covering various personal and business needs.
Rocket Lawyer:
Provides accessible and affordable legal documents, advice, and services for businesses, families, and individuals, enhancing legal protection.
LegalZoom:
A well-known provider of online legal solutions and documents for small businesses and personal matters, offering accessibility and affordability.
Contractbook:
Specializes in contract management software for SMBs, streamlining the entire contract lifecycle with a focus on automation and insights.
What is an AI Contract Generator?
With an AI contract generator, businesses can create, review, and customize legal agreements using a digital assistant powered by Artificial Intelligence. To draft contracts that include terms, definitions, and legal conditions that a human would describe, the software searches comprehensive texts in business documents, mimicking human analytical skills.
AI is setting a new standard for efficiency as manual contract creation becomes obsolete and replaced by Contract Lifecycle Management (CLM) systems. It seems traditional CLMs lacking AI features are at risk of falling behind because a growing number of companies are experiencing unprecedented levels of productivity.
Why Use a Contract Generator?
Contract generation is changing with its time-consuming back-and-forths, high errors, and substantial resource investments. Manual and time-consuming processes have come to an end in this era. This results in reduced physical, mental, and time expenditures while achieving business objectives more efficiently.
Here are a few reasons why AI contract generators should be used:
Contract Drafting in a Flash:
AI learns from a broad database of contracts to quickly generate detailed drafts, outpacing human capabilities and including all necessary elements for business engagements.
Due Diligence is enhanced:
AI scrutinizes contracts for risks, ambiguities, and inconsistencies by using natural language processing, and offering suggestions for improvement.
Operational costs are reduced:
It automates the drafting and review process, reducing manual labor and allowing professionals to focus on more strategic tasks, saving time and resources.
Access to insights is improved:
AI systems are trained using extensive contract data to identify trends, common clauses, and effective negotiation tactics, allowing legal teams to make better decisions and negotiate more effectively.
Best AI Contract Generators
AI contract generators are changing the way we create and manage documents. They offer personalized, legally sound contracts via artificial intelligence. These tools streamline workflows, ensuring accuracy and compliance, and are crucial for businesses seeking efficiency and scalability in their legal processes.
AI Smart Contract Generator For Professional Services
Cone:
Even though Cone doesn't offer AI capabilities, it automates contract and proposal management making you and your client happier.
In a single, seamless environment, Cone can be used to create and manage proposals and contracts. With Cone, you can send out proposals, contracts, or agreements to multiple signatories for secure signatures. Perfectly optimized for any device, it allows your clients to easily open, review, and sign while you monitor activity in real time.
Top Features:
- Send proposals, and automate invoicing, billing, and payment collections in one platform.
- Automates contract renewal processes by initiating reminders, auto-generating proposals, and capturing signatures well before the due date.
- Create stunning proposals with a flexible editing tool.
- Secure e-signature collection optimized for any device.
- Streamline the invoicing process and manage Account Receivables with automation.
- Offer clients a dedicated space for interactions, improving collaboration and service delivery.
Pros
- Combines multiple tools into one unified platform, reducing tool fatigue.
- Automates repetitive tasks, saving significant time and potentially reducing software costs.
Cons
- New users may need time to learn and utilize all available features effectively.
Best For
- Service-based businesses can use it to streamline the proposal-to-payment process.
Pricing
- Ideal for solo users, starts at £8/mo billed annually.
- Tailored for growing businesses, starting at £32/mo for 5 users billed annually.
- Additional users can be added for £4 or £3 per user, depending on the plan.
OpenLaw
The OpenLaw project under ConsenSys utilizes blockchain technology to create, execute, and manage legal agreements efficiently. A smart contract based on Ethereum blockchain technology is integrated into traditional legal contracts to facilitate the automated and secure execution of agreements.
Pros
- Contracts are secure and immutable with Blockchain integration.
- Streamlines execution with smart contracts.
- Facilitates convenient integration for developers.
- A user-friendly markup language simplifies the creation of smart contracts.
Cons
- A basic understanding of blockchain technology is required by users.
- A blockchain that is primarily based on Ethereum may limit its ability to be used with other technologies.
- There is a learning curve and uncertainty surrounding legal recognition in various jurisdictions with all blockchain-based legal technologies.
Best For
- Smart contract functionalities looking to integrate into legal agreements.
- Applications around open-source legal technologies seeking to build.
- Interested in exploring the intersection of legal contracts and blockchain.
Pricing
- Its core offerings are available without direct cost. However, specific implementations, especially those requiring custom development or integration, may incur costs depending on the scope of the project.
Free AI Contract Generator
LawDepot
LawDepot offers free legal forms, documents, and contracts that users can customize and print or download within minutes. In addition to real estate and finance, it also handles business and family law.
Top Features
- Contains a wide range of legal documents covering real estate, financial agreements, business contracts, and family planning.
- A simple set of questions allows users to customize legal documents.
- Generates customized legal documents in 5-10 minutes.
- It is free to print or download many documents, allowing users to save time.
Pros
- Easy-to-use interface with a guided document creation process.
- Free access to legal documents.
- It is suitable for both personal and business legal needs.
Cons
- Personalized legal advice cannot be provided through this service.
- More specialized documents or extended use may necessitate a subscription.
Best For
- Seeking accessible, no-cost solutions for basic legal document creation.
- Users looking to manage common legal tasks like renting property, lending money, or planning family matters.
Pricing
- Offers many legal documents at no cost.
- Advanced features and specialized documents may require purchasing a subscription. Pricing details for these services are best obtained directly from LawDepot, as they may vary based on the specific needs and offerings at the time.
Rocket Lawyer
Rocket Lawyer provides legal services via the Internet, making them more accessible and affordable for businesses, families, and individuals. More than 20 million users use it to create legal documents, obtain attorney advice, and manage legal issues confidently.
Top Features:
- Users can customize, share, and create an unlimited number of legal documents to suit their needs.
- This feature allows for quick and secure electronic signing of documents.
- Provides access to real lawyers for legal questions with responses in as fast as one business day.
- Offers protection for your contracts, ensuring you can enforce your agreements if needed.
- Members enjoy up to half off on services like business registration, tax preparation, trademark filing, and more, through Rocket Legal+™ membership.
- Priority support from trained specialists, aiming to save users time.
- Ensures data security through SOC-2 Type-1 compliance and adherence to GDPR regulations, maintaining privacy and integrity of information.
Pros
- Offers a wide range of legal documents and services, from making documents to tax filing and starting a business.
- Allows for endless modifications and copies of legal documents.
- This enables documents to be signed electronically and securely.
- Provides fast access to real lawyers and legal advice within one business day.
Cons
- After the 7-day free trial, membership fees apply.
- The broad range of services might overwhelm users only needing simple legal assistance.
- The most significant savings and benefits are locked behind the membership model.
Best For
- Legal documents, advice, and services for small to medium-sized businesses.
- Those in need of quick, legally sound documents and advice without the high cost of traditional legal consultations.
- Provides legal advice and incorporation services for entrepreneurs starting businesses.
Pricing
- $19.99/month, $239.88 billed annually.
- Members can save up to $2,500 per year on various legal services, including business registration, tax preparation, and attorney services.
- Discounts on professional services, including tax preparation, attorney services, and business registration.
- Users can try services for free for seven days before committing.
AI Legal Contract Generator:
LegalZoom
LegalZoom is a comprehensive legal services platform offering access to a wide array of legal documents, attorney advice, and services designed to support both personal and business legal needs. LegalZoom caters to entrepreneurs, families, and individuals across the country by making legal help accessible and affordable.
Top Features
- The firm offers everything from business formation to estate planning to intellectual property protection.
- Provides users with access to independent attorneys without charging an hourly fee.
- Easy-to-use tools enable users to create their own legal documents.
- Transparent pricing without hourly charges or surprises.
Pros
- Services cover a broad spectrum of legal needs.
- Flat-rate fees make it cost-effective compared to traditional legal services.
- The online platform allows for legal document creation and consultations from home.
- Provides access to a vetted network of attorneys for guidance.
Cons
- Cannot provide the same level of personalized legal advice as a dedicated attorney.
- Users may need to navigate legal complexities on their own when using self-service options.
Best For
- Owners of small businesses looking for legal advice and documents to start or manage their businesses.
- A person who needs estate planning documents, such as a will or a power of attorney.
- A trademark or copyright application can be filed by entrepreneurs and creators seeking IP protection.
Pricing
- A legal plan membership includes ongoing access to select legal services and consultations.
- Depending on the complexity of the service, users can purchase one-time services or documents.
Contractbook
With Contractbook, you can centralize, manage, and streamline the entire contract lifecycle for Small and Medium-sized Businesses (SMBs). Businesses have the tools to make informed decisions quickly by creating, signing, and storing contracts using a unified platform.
Top Features
- Easy access and management of all contracts with centralized contract management.
- Automates the extraction of key information from contracts, reducing manual data entry.
- Offers a comprehensive view of contracts, facilitating quick decision-making.
- Ensures critical dates are not missed.
- Streamlines the creation of new contracts with customizable templates.
- Accommodates businesses of any size without additional costs.
- Connects seamlessly with over 3000 tools for enhanced workflow automation.
Pros
- Saves significant time on contract management tasks.
- Provides clear insights into contract statuses and obligations.
- Suits businesses of all sizes with its unlimited offering.
- Prioritizes the security of contract data with robust measures.
Cons
- The wide range of features may require time to fully master.
- Specific pricing details require contacting for a quote, which may delay budget planning.
Best For
- Looking for a comprehensive contract management solution to handle growing contract volumes.
- It is crucial for teams across different departments to streamline their contract processes.
- Companies aim to reduce manual work and make data-driven decisions.
Pricing
- Targeted at mid-sized businesses for complete contract management; contact for a quote.
- For growing businesses needing advanced features like unlimited workflows and integrations; contact for a quote.
- Custom solutions for businesses with complex needs; contact for a quote.
How AI Contract Generators Work?
These AI contract generators work by analyzing a huge database of historical contracts to understand the structure and nuances of legal documents. Here's how it works:
Understanding Requirements:
The user inputs specific details about their contract needs, such as contract type, involved parties, terms, and special clauses.
Data Analysis and Generation:
Leveraging the input data, the AI sifts through its extensive library of past contracts to identify relevant structures and clauses.
Drafting the Document:
It then generates a draft contract that matches the user’s requirements, incorporating industry standards, legal stipulations, and custom terms.
Customization and Review:
Users can review and customize this draft, making adjustments to ensure the contract precisely fits their needs.
Beyond Drafting:
SpotDraft, for example, offers additional features that enhance its overall utility, such as collaborative editing, comprehensive contract review, and detailed contract analysis.
How to Choose the Right AI Contract Generator Software?
Choosing the right AI contract generator software involves assessing several key factors to ensure the tool meets your business needs effectively. Here are some steps and considerations to guide your decision:
Identify Your Needs
- You may need something simple for standard agreements, but if you are working on complex contracts, you will need something more sophisticated.
- You may need more robust automated features if your business has a high volume of contracts.
Evaluate Key Features
- Choose a template that suits your industry and type of contract from a wide selection of customizable templates.
- The platform should be user-friendly, with an intuitive interface that requires little training.
- A high-quality AI feature can offer better insights, risk analysis, and clause recommendations.
- Check if it integrates seamlessly with other tools you use, such as CRM, cloud storage, and email services.
- Take into account whether the software facilitates easy collaboration among team members and external parties.
- Ensure the software complies with relevant regulations and offers robust data protection measures.
Assess the Software’s Flexibility
- The software should grow with your business, accommodating increasing contract volumes and complexity without performance issues.
- It should allow for the addition of custom clauses and adjustments to templates to fully meet your specific needs.
Consider Legal Accuracy and Support
- Maintain legal soundness by ensuring templates and generated contracts are compliant with current laws and regulations.
- Look for platforms that provide legal advice, customer support, and resources to help you navigate complex legal agreements.
Analyze Pricing and ROI
- Understand the pricing model (subscription, per-document, etc.) and assess whether it aligns with your budget.
- Consider the software's potential to save time and reduce errors, thereby lowering costs and possibly preventing expensive legal disputes.
Read Reviews and Get Demos
- Look for reviews and testimonials from current and past users to gauge satisfaction levels and common issues.
- You can usually test the functionality of the software by downloading a free demo or trial period provided by the provider. Use these opportunities to ensure the software meets your needs.
Check for Updates and Improvements
- Ensure that your provider is continually adding new features and improving its software.
Frequently Asked Questions:
What Types Of Contracts Can AI Generators Create?
An AI contract generator can produce a wide variety of contracts, depending on the business requirements. For example, employment agreements cover a wide range of employment relationships, non-disclosure agreements protect sensitive information, service agreements cover professional services, lease agreements cover property and equipment, sales contracts cover goods and services, partnership agreements cover business collaborations, license agreements cover intellectual property, and terms of service apply to online platforms and websites
How Do I Ensure The Contracts Generated Are Legally Binding?
The contracts generated by AI must comply with relevant laws and regulations in order to be legally binding. Aside from its programming and database, the AI incorporates changes in the law through periodic updates and reviews.
The contract should be reviewed by a lawyer to ensure it meets all legal requirements and is tailored to the needs of all parties. Ensure the enforceability of the contract by following the legal standards for signing and other formalities.
Can AI Contract Generators Accommodate Specific Legal Requirements Of Different Jurisdictions?
It can be challenging for AI contract generators to accommodate the legal requirements of different jurisdictions. Many of these tools can be customized and are updated regularly to reflect legal changes in jurisdictions.
A few AI contract generators also offer localization features, which adjust contract terms and clauses according to the legal environment of the jurisdiction. In cases where a company operates in multiple regions, legal experts from those regions may be necessary to ensure the contracts meet local legal requirements.
Are There Any Ongoing Costs Associated With Using An AI Contract Generator?
Subscription fees or pay-per-use fees are typically associated with AI contract generators' ongoing costs. Monthly or annual subscriptions may be required to access the tool and its features. In businesses with less frequent contract generation needs, pay-per-use options can be beneficial.
It is also possible to incur additional costs if additional services are provided, such as contract customization and legal reviews. If you're selecting an AI contract generator, it's important to consider these ongoing expenses to ensure they fit within your budget and meet your business needs. The subscription price may also reflect the importance of regular updates and maintenance for the tool's performance and compliance capabilities.
Conclusion
This blog explores various AI contract generators, discussing their features, pros, and cons. However, Cone stands out from the rest. In a single platform, it handles everything from proposals to payments for SMBs. Its intuitive proposal software and practice management tools not only save users at least $100 per month per user, translating into significant annual savings, but also simplify complex tasks.
The one-stop solution helps users streamline their workflows, allowing them to reduce manual work and focus on business growth. Cone is the perfect choice for businesses who want to manage their business more efficiently and effectively.