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DraftingTechnology Law / CorporateIntermediate

SaaS Terms of Service Drafting Prompt

Drafting Terms of Service for a SaaS company. Essential for protecting IP, limiting liability, defining acceptable use, and setting customer expectations.

📋 Prompt — Copy & Use
You are a technology attorney drafting Terms of Service (ToS) for a SaaS product. Create comprehensive terms for:

**Company/Product:** [Company name and SaaS product description]
**Customer Type:** [B2B (businesses) / B2C (consumers) / Both]
**Pricing Model:** [Subscription / Usage-based / Freemium]
**Data Handling:** [Do you process customer data? What types?]
**AI Features:** [Does the product use AI/ML? Does it train on customer data?]
**Geographic Market:** [US only / EU (GDPR) / Global]
**Industry:** [General / Healthcare / Financial Services / Legal — regulated industries need extra provisions]
**Specific Concerns:** [IP ownership, API terms, reseller rights, white-labeling, etc.]

Draft Terms of Service covering:

1. **Acceptance and Updates** — How users agree; how you update the terms
2. **Account Registration** — Account requirements, user responsibilities
3. **License Grant** — What rights you grant customers to use the software
4. **Acceptable Use Policy** — What customers may and may not do
5. **Subscription and Payment** — Pricing, billing, auto-renewal, refund policy
6. **Intellectual Property** — Who owns what (your IP, customer data, feedback, AI-generated outputs)
7. **Data Processing** — How you handle customer data; reference to Privacy Policy and DPA
8. **AI Provisions** — Training data use, output accuracy disclaimers, prohibited use of AI features
9. **Disclaimer of Warranties** — AS IS disclaimer
10. **Limitation of Liability** — Cap on damages
11. **Indemnification** — Mutual or one-way
12. **Term and Termination** — Subscription term, cancellation, effect of termination
13. **Dispute Resolution** — Arbitration clause (or courts if B2B), governing law
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✓ Best Practices

  • ✓B2C terms need consumer-friendly language and may need to comply with state consumer protection laws
  • ✓AI provisions are critical — clearly state whether you train models on customer data
  • ✓Limitation of liability cap should typically match the fees paid in the prior 12 months
  • ✓GDPR requires a separate Data Processing Agreement (DPA) for EU customers
  • ✓Auto-renewal disclosure must comply with applicable state automatic renewal laws (California, New York)

⚠ Limitations

  • ⚠Terms of service enforceability varies by jurisdiction — clickwrap vs. browsewrap matters
  • ⚠Consumer-facing terms face heightened scrutiny — unconscionable terms may be void
  • ⚠Regulated industries (healthcare, financial services) require additional compliance provisions

Expected Output

Complete SaaS Terms of Service with all standard sections. Typically 3,000–6,000 words.

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Important: AI-generated legal content requires review by a licensed attorney before reliance. Verify all cited cases and legal authority independently. Nothing on this page constitutes legal advice.