AI Can Help You Find Your Company's Biggest Legal Risk
AI transforms legal risk management by surfacing hidden signals from external data sources, enabling proactive identification and mitigation of exposure before litigation begins.Summary
Gaby Prechner, VP Product & Tech at Darrow, argues that AI is essential for managing the expanding surface area of legal risk that exists outside an organization's walls. The article explains that legal risk often manifests through signals in regulatory filings, public records, and market activity long before a lawsuit is filed. By leveraging a structured knowledge base of legal exposure, AI enables corporate legal teams, insurers, and law firms to detect these emerging risks proactively. The author draws a parallel to cybersecurity, emphasizing the need to monitor threats beyond the perimeter. She highlights that AI can identify massive undetected exposures, such as $400 billion in employer-sponsored benefit plan liabilities. To effectively use AI for risk management, organizations must shift from a reactive mindset to a proactive one, continuously scanning for signals. This approach benefits insurers, plan sponsors, regulators, and law firms by providing better inputs and visibility. The article concludes by outlining three steps for organizations to proactively address legal exposure: developing a consistent practice of looking outside the organization, creating an always-on process for evaluating areas of exposure, and sharing a common taxonomy for discussing legal risks.
(Source：Forbes)
