What to Ask Before Signing Any AI Services Contract

The AI services market has matured enough that there are now vendors for every budget and every use case — and enough bad actors to warrant caution. Before you sign anything, these are the questions that separate a good engagement from a costly lesson.

1. What exactly are you building for me?

This sounds obvious. It often isn’t. Ask for a written scope of work that describes the specific output — not “an AI solution” but “a chatbot that handles the top 20 inbound questions from your website visitors, integrated with your CRM, with a fallback escalation to email.” Vague deliverables are how scope creep starts and how disputes end.

2. Who owns the output?

Anything built for you using your data should belong to you. Confirm in writing: the trained models, the prompt templates, the integrations, the data pipelines. Some vendors retain ownership of the underlying systems and charge you for access in perpetuity. Know what you’re buying.

3. How is my data handled?

Your business data — customer records, emails, financial figures — will likely be used to configure or train whatever system they build. Ask: where is it stored? Who can access it? Is it used to train models that serve other clients? GDPR and CCPA obligations don’t go away just because a vendor is involved.

4. What happens when it breaks?

AI systems fail in non-obvious ways. A chatbot that was working fine last month may start giving bad answers after the underlying model is updated. Ask what SLA (service level agreement) applies, how quickly issues are addressed, and who is responsible for monitoring the system after launch.

5. How do I get out?

Before you sign, read the termination clause. Can you cancel with 30 days notice? What happens to your data after you leave? Are there penalties for early termination? The best vendors make offboarding clean — they want your reference, not your resentment.

6. Can I talk to a current client?

Ask for a reference in your industry or with a comparable business size. A vendor who can’t produce one — or who hedges — is telling you something. A 15-minute call with an existing client is worth more than any sales deck.

The Baseline

You don’t need a lawyer for every AI engagement. But you do need clarity on scope, ownership, data, support, and exit before any money changes hands. A reputable vendor will have clean answers to all of these. Ones that don’t are worth walking away from.

If you’re evaluating AI vendors for your San Diego business and want a second opinion before committing, we’re happy to take a look — no strings attached.