Traffic Light Risk Analysis
Generate traffic light (green/yellow/red) risk assessments for contract provisions, enabling 50-70% faster stakeholder communication.
50-70% faster stakeholder communication
Consistent risk categorization
Contract Intelligence & Analytics
The Problem
- ✗Lengthy memos for business stakeholders
- ✗Difficulty prioritizing issues
- ✗Communication gaps with non-lawyers
- ✗Time spent explaining risk levels
- ✗Inconsistent risk characterization
How Claude Helps
Analyzes each provision against standards, assigns risk rating (green/yellow/red), provides brief rationale, generates visual-ready output, and summarizes overall risk.
Step-by-Step Workflow
Upload contract
Upload contract for risk assessment
Define risk standards
Define risk standards or use existing playbook
Run traffic light analysis
Run traffic light analysis against defined standards
Review ratings and rationale
Review ratings and rationale for each provision
Share with stakeholders
Share visual risk assessment with stakeholders
Example Prompt
Generate a traffic light risk assessment for this vendor agreement: RISK CATEGORIES: GREEN (Acceptable) - Matches our standard requirements - Common market terms - No negotiation needed YELLOW (Attention) - Deviates from standard but acceptable - May want to negotiate - Requires business decision RED (Risk) - Significantly unfavorable - Should negotiate before signing - Potential deal issue ASSESS THESE PROVISIONS: 1. Liability cap 2. Indemnification 3. Termination rights 4. Data security 5. IP ownership 6. Confidentiality 7. Assignment 8. Governing law FOR EACH: | Provision | Rating | Issue | Recommendation | SUMMARY: - Overall risk rating - Key issues requiring attention - Negotiation priorities - Recommendation (sign/negotiate/reject) Format for business stakeholder review.
Frequently Asked Questions
How do I calibrate risk ratings?
Define your standards explicitly. "Green means it matches our playbook. Yellow means deviation we've accepted before. Red means we've never accepted this."
Can I customize the categories?
Yes. Use whatever rating system works for your organization (numbers, letters, colors, etc.).
How do I handle provisions with mixed ratings?
Assign based on the most significant risk element and explain the nuance in the rationale.