Ohio Land Title Association – Title Agent Practice Exam

A contract of adhesion is characterized by being offered on a "take it or leave it" basis, meaning that the insured must accept the entire contract along with all its terms and conditions as presented by the insurer, without the opportunity for negotiation. This type of contract is typically used in insurance agreements, where the insurer drafts the contract and the insured has little power to alter its provisions. The insured is expected to accept the terms in their entirety, which is why it's essential for them to thoroughly review and understand the contract before acceptance.

In contrast, a mutual contract would involve a negotiation process where both parties have a say in the terms. A void contract is one that is not legally enforceable from the moment it is created, while an express contract clearly states the terms and conditions by which both parties are agreeing but does not necessarily bind the insured to accept those terms without negotiation. Understanding the nature of contracts helps clarify which type requires full acceptance of all terms without alteration.