In 2024, legal AI moved from curiosity to necessity, setting the stage for widespread implementation in 2025. 

Almost every sizable law firm has already hired a Head of AI. Recognising that generative AI is here to stay and will have a significant impact on their business, they’re actively exploring and procuring legal AI solutions. Falling behind in adoption could make them less competitive and they don’t want to miss the wave. More and more law firms and legal teams are realising they need to embrace AI to gain efficiency and boost their competitive edge. They’re spent 2024 figuring out how to do it, and in 2025, it’s going to happen.

Who’s using legal AI at the moment?

Highly regulated sectors have led the adoption of legal AI, with the most interest coming from law firms, accountancy firms, banks, and insurers. These industries face significant compliance demands and higher risks, driving their need for efficient legal solutions. Larger organisations in these sectors benefit most, as even modest efficiency gains scale dramatically. A 20% time saving across a team of 100 legal professionals is a significant operational improvement.

In practice, time savings often exceed 50% for tasks like contract review or rapid drafting. One client, Agristo, reduced contract review times from two hours to just 15 minutes using LEGALFLY. These efficiencies free up resources, enabling legal teams to handle more work internally and reducing reliance on costly external counsel, which often consumes over 50% of legal budgets.

For corporations, the financial impact is substantial. Many legal teams are small and overstretched, with high turnover rates and limited capacity. AI helps streamline workflows, cut costs, and improve decision-making processes. By speeding up legal reviews and drafting (our customers report 50% faster drafting and 2.5x quicker contract reviews) legal teams become more proactive and integrated into the business. This reduces risk, enhances collaboration, and positions legal as a central, responsive part of the organisation.

What will we see in 2025?

Experimentation to adoption

Legal departments across industries are recognising that the benefits of AI are too great to ignore. This year, many teams experimented with AI solutions to identify their most pressing use cases. By 2025, we expect these experiments to translate into full-scale adoption, backed by defined budgets and clear objectives.

Regulated industries such as banking, insurance, and accountancy are leading this adoption curve. The high stakes of compliance and the pressure to reduce costs make these sectors particularly receptive to legal AI. 

A focus on AI designed for legal work

Most legal teams have now experimented with ChatGPT, and a significant portion have tried Microsoft Copilot as well. For non-legal use cases, like summarising documents or drafting emails, these tools tend to perform well. However, when it comes to legal work, their limitations become evident very quickly.

The biggest risk with these generalist models is hallucination. Both ChatGPT and Microsoft Copilot often generate responses that sound polished and convincing but aren’t grounded in precedent or reliable sources. This issue has led to high-profile errors, such as the case in New York where lawyers submitted fabricated case law generated by ChatGPT. The lawyers faced severe consequences, including sanctions. This kind of error highlights the dangers of relying on models not specifically designed for legal applications.

Another major concern is privacy. Data processed through Microsoft Copilot or ChatGPT is accessible to Microsoft or OpenAI, which means confidential client information can be exposed without consent. This is a serious problem, especially in the legal industry, where data privacy is paramount. At LEGALFLY, we address this issue by anonymising all data before processing it, ensuring client confidentiality is maintained.

Lastly, tools like ChatGPT and Copilot are conversational in nature, making them suitable for answering basic questions but insufficient for automating complex legal tasks like contract review or drafting. By contrast, LEGALFLY is designed to handle these workflows comprehensively, offering much greater value for legal teams.

The rise of agentic AI

The challenge for legal departments in adopting AI lies in the individuality of their processes and policies. A one-size-fits-all approach or reliance on standard playbooks won’t cut it. Instead, the solution lies in creating custom AI agents for fully bespoke workflows for each organisation. These agents allow teams to set their own rules, define tailored processes, and establish unique information repositories. 

This addresses the nuances of individual organisations and unlocks a wealth of potential use cases. For instance, in the insurance and banking industries, AI can analyse repositories of historic loan decisions, identifying patterns in similar characteristics and tracking how those loans performed. Such tailored applications streamline decision-making, enhance accuracy, and improve outcomes.

At the same time, the legal industry has already embraced tools to streamline tasks like case analysis, contract review, and compliance checks. Generative AI has taken this a step further, enabling large language models to be trained on litigation files and other legal records. This has paved the way for creating highly customised solutions to address specific legal needs.

For us, this led to the development of an AI workspace designed for collaborative legal tasks. Within this workspace, we’ve created specialised legal agents, each tailored to distinct use cases. We currently offer over a dozen agents that handle tasks such as contract review, drafting, due diligence, providing legal advice, anonymisation, translation, document comparison, legal research, and compliance checks. These agents form a comprehensive and adaptable toolkit for modern legal challenges.

Looking ahead, the evolution of foundational AI models will further expand the capabilities of these agents. As new models emerge, our clients will benefit from even more specialised solutions, unlocking advanced capabilities and delivering results faster.  

End-to-end automation of legal workflows

This year, we’ll see even deeper automation of legal workflows. AI Agents won’t just respond to specific queries, but will handle entire processes autonomously. For example, an agent could identify an incoming email containing a contract, apply the appropriate playbook, perform a risk review, redraft the document as needed, and send it to the general counsel for confirmation. Once approved, the agent could automatically forward the finalised document to the counterpart. 

This level of workflow automation will transform the way legal teams operate, allowing them to focus on strategic tasks while routine processes are managed by AI.

Doubling down on security and privacy

Security and privacy are non-negotiable for enterprise clients. Tools like on-premise deployment and anonymisation features are key to securing client trust. We’re the only legal AI anonymising data before processing documents, and confidential information stays securely in your control. LEGALFLY complies with the highest industry standards, including GDPR, ISO27001, and SOC2 certifications.

Legal AI providers that fail to meet these standards will likely find themselves excluded from serious procurement discussions. On the flip side, those that excel at safeguarding data will gain the trust required to build long-term relationships.

So, to recap: In 2024, legal AI transitioned from a curiosity to an essential tool for modernising legal operations. As organisations across regulated industries embraced the potential of AI, they laid the groundwork for broader adoption in 2025. This year will bring deeper automation, enhanced data reliability, and a sharper focus on security and privacy. As foundational models evolve and agentic capabilities expand, the legal industry will see a significant transformation, where AI not only supports but actively drives smarter, faster, and more reliable legal work.