In-House Legal Teams Double GenAI Use and Press Law Firms on Pricing
Generative AI use among U.S. in-house legal teams has more than doubled in a year, from 23 percent to 52 percent, according to a survey by Everlaw and the Association of Corporate Counsel (ACC). Many of those teams now want outside law firms to pass on the resulting efficiencies through new pricing.
- U.S. in-house GenAI adoption for legal work rose to 52 percent from 23 percent, per the Everlaw and ACC survey of 657 legal professionals.
- Company bans on GenAI fell to 9 percent from nearly 30 percent a year earlier.
- 64 percent expect to rely less on law firms, with drafting, contracts and legal research the top areas to move in-house.
- Nearly six in 10 lack visibility into law firms' GenAI use and report no savings passed on.
- 61 percent are ready to push for new delivery and pricing models.
Adoption climbs as bans fade
The survey, titled Generative AI's Growing Strategic Value for Corporate Law Departments, covers 657 chief legal officers, general counsels and legal operations professionals in the U.S., Europe, Australia and Asia. Everlaw says corporate legal departments are no longer debating whether to use GenAI, but where it will have the greatest impact.
Among U.S. in-house teams, GenAI adoption for legal work reached 52 percent, up from 23 percent last year. The share with no plans to use it fell to 2 percent. Company bans were cited by just 9 percent of respondents, down from nearly 30 percent a year earlier.
Optimism has grown too. Half of U.S. respondents (50 percent, up from 45 percent) expect the impact on legal work to be significant, and 20 percent expect it to be transformative, up from 11 percent. One third now report measurable cost savings, compared with one quarter last year.
More work stays in-house
Nearly two-thirds of respondents (64 percent) expect to rely less on law firms because of GenAI. Large majorities see the biggest opportunity to bring drafting (78 percent), contracts (71 percent) and legal research (62 percent) in-house. About a third see room to handle litigation and M&A matters internally, at 29 percent each.
Asked where they expect the biggest savings on work currently done by outside counsel over the next three years, 82 percent named contract drafting and negotiation. Nearly half also expect savings in higher-value, repeatable work, including regulatory and compliance tasks, general counsel tasks, litigation and M&A.
A disconnect with outside counsel
The survey points to a gap between clients and their law firms. Nearly six in 10 respondents say they lack visibility into GenAI use on their matters, and the same share report seeing no savings passed on. Four in five neither require nor encourage law firms to use the technology. When the subject comes up, it is usually informal and undocumented, rather than written into outside counsel guidelines or RFPs.
Only 24 percent of respondents are satisfied with how outside counsel use GenAI to deliver value. While 63 percent say it is too early for cost reductions to appear, nearly 60 percent note that law firms have not begun adjusting pricing models for AI efficiencies.
Pressure on the billable hour
In-house leaders appear ready to change that. A significant majority, 61 percent, are prepared to push for new delivery and pricing models, and 49 percent believe client demand will be the main driver. Many point to value-based billing and alternative fee arrangements.
Everlaw argues that firms which link GenAI-enabled efficiency to fair, transparent pricing will set themselves apart as modern, client-first partners. The company also says GenAI is becoming a catalyst for a more strategic in-house legal function, one that could reshape pricing expectations and give legal leaders more leverage in negotiations.
