Third-Party AI Data Agreements

This question verifies whether your vendor has formal contracts with their AI providers (like OpenAI, Google, or AWS) that specifically protect your data. It's asking: 'If you're sending our data to an AI service, do you have a legal agreement ensuring they won't misuse it?' These agreements should cover data protection, usage limitations, and what happens to your information once the AI processes it.

Without proper AI agreements, your data enters a legal gray zone where protection isn't guaranteed. This gap can lead to your confidential data training public AI models, inability to meet audit requirements, or breaches without recourse. Strong third-party agreements ensure accountability throughout the AI supply chain, protect you from liability if the AI provider mishandles data, and provide legal remedies if something goes wrong. This is especially crucial for regulated industries where you're responsible for your vendors' vendors.

Many assume standard terms of service are sufficient, but consumer-grade AI services often claim broad rights to user data. Another pitfall is accepting generic 'we have agreements' responses without confirming these specifically address AI data processing, retention, and your right to audit or delete data from AI systems.