How to review a SaaS subscription agreement

A subscription agreement gives a customer the right to use a hosted software service for a term, usually with automatic renewal. The customer never receives a copy of the software, so the agreement is mostly about access, service levels, data and money. This checklist covers what to check and how to review the agreement in Word with LexDraft's SaaS MSA playbook. It is about software subscriptions; a securities subscription agreement for buying shares or units is a different document, which LexDraft reviews as a general review with no dedicated playbook.

Last checked: 17 October 2026. The law changes; check the current position before relying on this page.

Clause checklist

• Subscription scope. Users, seats, usage metrics and affiliates. Check how overages are measured and billed, and whether usage limits can change mid-term.
• Order forms. Most subscription agreements are a framework with order forms for each purchase. Check the order of precedence and whether order forms can override the main terms.
• Term and auto-renewal. Renewal length, the notice deadline for non-renewal, and price changes at renewal. Some states regulate automatic renewal even between businesses. New York General Obligations Law section 5-903, for example, makes an automatic renewal clause in certain contracts for service, maintenance or repair to or for real or personal property unenforceable against the customer unless the provider sends a written reminder 15 to 30 days before the non-renewal notice deadline. Consumer subscriptions face stricter state laws, such as California's Automatic Renewal Law (Business and Professions Code section 17600 and following).
• Fees and increases. Annual price increase caps, payment terms, taxes and suspension for non-payment.
• Service levels. Uptime commitment, how it is measured, exclusions for maintenance, service credits and whether credits are the exclusive remedy.
• Customer data. Ownership, the provider's permitted uses (including any use to train AI models), data location, return and deletion at the end of the term.
• Security and privacy. Security standards, audit reports, breach notice timing and a DPA where personal data is processed. See our DPA review guide.
• Warranties. The service will perform materially as documented, plus a remedy if it does not. Watch for disclaimers that empty the warranty.
• IP indemnity. The provider should defend claims that the service infringes third-party IP. See our indemnification clause guide.
• Limitation of liability. General cap, exclusions for consequential damages, and separate caps for data breaches. See our limitation of liability guide.
• Changes to the service and terms. Can the provider change features or update its terms by posting a new version? Customers usually ask that changes do not materially reduce functionality during the term.
• Exit. Data export in a usable format, transition help, and what happens to prepaid fees if the provider terminates.

A subscription agreement review workflow in Word

LexDraft is a Word add-in from Microsoft AppSource. It opens as a side panel in Word 365 (Windows and Mac), Word 2021 and Word on the web, so the agreement never leaves the tool you already draft in.

1. Open the agreement in Word and open LexDraft in the side panel.
2. Pick the governing law. Select the state named in the governing law clause so LexDraft looks for state-specific red flags.
3. Run the review. Run the review with the SaaS MSA playbook, which is built for cloud service agreements. Then use the checklist on this page for points such as renewal notice deadlines in the order form.
4. Triage by severity. Findings are graded Critical, High, Medium or Low, and LexDraft flags standard terms that are missing.
5. Run the quick checks. The defined-term and cross-reference checks are rule-based and run without AI.
6. Accept or reject each redline. Accepted changes land as native Word tracked changes.
7. Verify and sign off. You check every output before it goes to the client or the other side.

Common mistakes

• Missing the non-renewal notice deadline because it sits in the order form, not the main terms.
• An order form that silently overrides the negotiated liability cap.
• Using "Service", "Platform" and "Software" for the same thing. The defined-term check catches this.

This guide is general information, not legal advice. LexDraft does not give legal advice; qualified counsel must review every draft. Spotted something out of date? Email support@lexdraft.ai and we will fix it.